By Tom Garland, MBA 15
- The company’s free cash flow has been negative since 1994, owing to poor sales and a highly capital-intensive industry
- Significant declines in ROIC
- Opaque ownership and incentive structure
By Tom Garland, MBA 15
By Nick Wobbrock, Chad Reed, Leigh Madeira, and Zach Knight, all Full-time MBA 15
The Win: First place in the Morgan Stanley Sustainable Investing Challenge, at Morgan Stanley’s London Headquarters on April 17.
The Team: (left to right) Nick Wobbrock, Chad Reed, Leigh Madeira, and Zach Knight, all full-time MBA 15
The Field: The challenge began with 380 students, on 127 teams, from 78 graduate schools, based in 20 countries. The final round included 10 teams from 10 top graduate business schools.
The Pitch: Our team, Blue Forest Conservation Notes, pitched a financial structure that would allow investors to help California and the Western U.S. alleviate historic droughts and catastrophic forest fires, all while earning competitive returns. Blue Forest Conservation Notes utilizes pay-for-success contracts to monetize the shared benefits of proactive forest management among water and electric utilities, as well as the US Forest Service. We defended our investment thesis in front of a panel of industry leaders, including both impact-focused investors and more traditional institutional asset managers.
The Clincher: The judges cited the timeliness of the problem, and our team’s convincingly innovative financial structure, which they believed would bring investors and stakeholders together to take a step forward in solving California’s two most pressing environmental issues.
Big Impact in Boulder
The Win: First place in the Leeds Net Impact Case Competition in Boulder, Feb. 20-21
The Team: Akshay Yadav, Jessica Holland, Carl Olson, and My-Thuan Tran, all MBA 16
The Field: Twenty-five teams of four graduate students each, competing to solve real-world sustainability business cases
The Pitch: Our team was asked to plan the optimal coastal restoration infrastructure for a city that is facing a growing threat of erosion and severe flooding due to climate change. Our approach was to minimize costs and risks and develop a diverse capital expenditure plan to ensure long-term protection. Our solution was a three-pronged approach of green infrastructure funded by water protection taxes; earthen berms funded by FEMA grants; and wetlands protection funded by wetlands mitigation banking.
The Clincher: One thing our team kept top of mind was the Haas defining principle “question the status quo.” The solution we came up with was not a conventional way of financing similar projects, according to our research. However, we knew we needed to take a bold approach for a bold solution. We worked to mitigate the risks in our proposal, and we prepared for the tough Q&A session.
The Win: First place in the Fink Center Stock Pitch Competition at UCLA on Feb. 20
The Team: Miran Ahmad, MBA 15; Carl Choi, MBA 16; Scott Furumoto, MBA 15; and Zane Keller, MBA 15, all of the Haas Investment Club
The Field: MBA students from 10 other business schools across the country
The Pitch: Our team, “Get Shorty”, pitched a short recommendation on insurance company Assurant in the first round. Living up to iour name, we also decided to short Chinese e-commerce company Alibaba in the final round. We defended our investment thesis in front of a panel of judges, from hedge fund managers to equity research analysts.
The Clincher: While our team fielded difficult questions during the Q&A, one judge later remarked that what helped the us stand out was our ability to defend its thesis confidently but without sounding defensive.
Veteran team member Zane Keller believes that the difference came down to the team’s decision to take a controversial short position on final round stock Alibaba. “After thoroughly reviewing the macroeconomic assumptions and the underlying fundamental growth projections required to justify its lofty stock price, we knew it would be difficult to make a long recommendation.”
The Win: 2nd Place in the Rotman International Trading Competition, the largest trading competition in the world, in Toronto, Feb. 20
The Team: Master of Financial Engineering students Simon He, Yi Lu, Tanya Gupta, Tong Lu, Wontai Cho and Maoqi Wang, all MFE 15. MFE Lab Manager Charles McCutchen helped prepare the team.
The Field: More than 50 teams from universities around the world, including MIT, Columbia, NYU, Princeton, the London School of Economics, and 1st-place winner LUISS Guido Carli/University of Rome.
The complex acquisition of a promising tech startup was the subject of a negotiation competition that paired MBA students with Berkeley Law students last week.
Jamaur Bronner, MBA 16, and Jared Ginsburg, JD 17, prevailed in the Emma and Joseph H. Halloum Business Competition at Boalt Hall Nov. 6. They represented the fictional company Simtech, which had patented a technology that could charge mobile devices through movement and was being acquired by Microsoft.
The other finalist team, Moe Poonja, FTMBA 16, and Jasmin Varjavan, JD 16, represented Microsoft. The finalists were selected from among 12 teams after the first of three rounds of negotiations.
“This was an incredible experience. I spent three days competing against well-prepared peers and evaluating a very relevant and multi-faceted technology case,” Bronner said. “The opportunity to connect with and learn from fellow Haas classmates and Boalt law students was invaluable. Negotiation is a key business skill that can potentially define and propel one’s career.”
In each round, the teams had to negotiate a purchase price, along with a number of other complex deal terms such as a no-shop provision, early termination fee, and CEO replacement, Poonja said. Among the judges were Saleforce’s senior corporate counsel, the CFO of RingCentral, the vice chairman of Activision Blizzard, a Trust Company of the West VP, and Haas Senior Lecturer Tim Dayonot.
The competition is held every fall to give Berkeley MBA and Law students an opportunity to join forces in tackling a real-world transaction under time pressure.
“One of the challenges in managing a business is that over time the team puts on blinders. It becomes easier to spend more time thinking of why we cannot do something, rather than why we can do something,” Brunetti said. “You go into ‘protect’ mode instead of being on offense. The energy of the Haas students could challenge our thinking and pre-dispositions.”
A comment from a doctor at a children’s cancer hospital in Bangladesh moved Rekha Iyer and her international team of MBA students to action.
The doctor said most of the families seeking care for their children make less than $2 per day. When they find out cancer treatments cost $10,000 to $15,000, they go home and cry “because they realize they can’t do anything for their child,” he said.
“As a parent, that doctor’s words really resonated with me,” Iyer says.
Iyer, MBA 15, is one of two Evening & Weekend Berkeley MBA students shortlisted in a Financial Times competition to develop business plans for the British nonprofit World Child Cancer (WCC).
Matt Volm, MBA 16, is also among the 40 students on seven finalist teams in the Financial Times MBA Challenge. The teams were tasked with coming up with recommendations for the long-term sustainability of WCC’s programs in developing countries.
WCC partners with hospitals and healthcare workers in Africa, Asia, and Central America to increase children’s access to drugs and treatment.
Challenge winners will be announced in October.
“I got involved to have an opportunity to evaluate a major healthcare issue at the global level for a great cause,” says Volm. “I knew my finance background would help, as a lot of times the hardest part about a problem is putting solid data around a potential solution.”
Volm’s team of seven includes students from Nigeria and Europe. Their project, Ripple, is focused on Ghana, where child cancer patients have limited access to drugs and treatment is prohibitively expensive.
Iyer’s team, Cut Out Cancer, developed a plan to use mobile technology to help the Bangladeshi hospital raise funds.
When Iyer came across the competition online, she saw it as an opportunity to test her skills and new career direction.
With a background in pharma and biotech, she plans to use her MBA to pursue a career in healthcare and social impact.
“The charity that we are partnering with brings my interests together,” she says. “It’s more and more important for an NGO to be run with the same discipline as a business.”
Each team must have representatives from the Americas, Asia, and Europe. Both Volm and Iyer said the experience of working with an international team has been rewarding—and also a logistical challenge.
“The international perspective that my team members bring is truly amazing and I’ve been able to learn so much from simply interacting with them,” Volm says. “The most difficult part has been coordinating schedules. Having team members in Africa and Europe can mean some pretty early morning conference calls.”
Berkeley MBA students working to increase minority representation and leadership at Haas and beyond have brought home the highest honor from the country’s largest and oldest business diversity organization.
The group also won $10,000 to build on their work for the Consortium for Graduate Study in Management.
Nikita Mitchell, Kory Vargas Caro, and Dan Wong, all MBA 15, accepted the T.E.A.M. (Together Everyone Achieves More) trophy earlier this month on behalf of Haas Consortium students. The three students served as liaisons to the organization this year.
“We were determined. For us, it was the way to prove to the Consortium that Haas is very serious about this work,” Mitchell says.
Established in 1966, the Consortium is an alliance of schools and corporate partners committed to reducing the under-representation of African-Americans, Hispanic Americans, and Native Americans in the ranks of upper management. It provides merit-based, full MBA-program fellowships to top candidates who have proven records of promoting inclusion in their schools, jobs, or personal lives.
Haas has been a longstanding member of the Consortium. There were 43 Consortium fellows in the Haas MBA program last year. Twenty-eight more will arrive this fall, bringing the total to 52.
The Haas group competed against 16 other b-schools for the hefty gold trophy.
To win, the group had to demonstrate their success in fundraising, community building, and fulfilling their duties as Consortium liaisons. They did much more: starting with a strategy meeting at the beginning of the school year to determine their goals and priorities as a group. Their activities included organizing school-wide social events; building a new leadership model for the group; organizing treks with other member schools; and taking an active role in the admissions process to increase the number of fellows who chose Haas.
In addition, the last two Consortium cohorts have stepped into more Haas leadership roles than ever—including Mitchell, who is the first African-American woman to serve as president of the MBA Association.
Mitchell said the race for the T.E.A.M. trophy is a different kind of competition.
“Everyone is happy for whoever wins, since we’re all working for a cause that we all believe in,” Mitchell says. “But at the end of the day, you want to prove that you are the school that is working the most passionately toward the Consortium’s mission.”