Learn how to solve a finance case study and make a recommendation – the type frequently given in technical finance interviews. We build a financial model to analyze key metrics. Free template included!
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One of the quickest and most common ways to evaluate candidates for analyst roles is to give them a finance case study during an interview. Case studies force us to both crunch the numbers quantitatively to demonstrate our knowledge but also think about the big picture and make recommendations – they are a lot of fun!
For these reasons, they are common in technical finance interviews, university projects, MBA programs, etc.
In this video, I help you solve a finance interview case study for a software platform that is considering a revenue share partnership with another company – this is the type of case study would be common at a FAANG or big tech company.
All case studies start the same way – they present you with a set of facts during some pivotal moment at a company where they are trying to decide whether they want to do some new thing (be it internally, or externally).
Regardless of the specifics – all case studies in finance are effectively asking you to do the same thing – build a simple income statement, differentiate COGS vs. OPEX expenses, calculate the depreciation for a CAPEX investment, and evaluate cash vs. accrual accounting payback period.
At the end, you are expected to synthesize your analysis into an open-ended recommendation about what the company should do.
Now that you understand the basic format of finance case studies, let’s walk through this example where I help you develop a framework of ideas to analyze situations with.
1:04 finance case study model setup (all case studies are basically asking the same info)
3:55 building the income statement & analyzing margins
10:50 calculating depreciation schedule for CAPEX
16:15 cash flow analysis & payback period vs. p&l
18:12 key quantitative metrics for making a case study recommendation
21:10 key qualitative metrics for making a case study recommendation
24:36 my finance case study recommendation
By the end of this video, you will understand how to approach finance case studies, crunch the numbers, and make recommendations in your future interviews – I guarantee it!
If you have questions – please leave a comment below and I’ll try to help. Cheers!
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