Investment Banking Commercial Awareness Questions

Tell Me About a Recent News Story

How to master ‘commercial awareness’ interview questions with 3 simple hacks.

Develop a Habit of Listening to the News

E.g. Consistently reading a commercial awareness newsletter or listening to a podcast.

Newsletter & Podcast Examples:

  • Podcasts
  • FT News Briefing
  • Finimize
  • Newsletters
  • Techcrunch if tech interests you
  • Pitchbook – especially the weekend pitch
  • City AM (more concise than the Financial Times)

My personal routine would be listening to the Finimize and FT News Briefing podcasts each morning – sometimes making a note if I find a new trend that I want to investigate further. However, it is consistency that is key with the podcasts as they inform you about key events. One example is the downfall of Greensill which was a supply chain finance company … interestingly enough one that I applied to … yet because that story was not in my ‘portfolio’ of trends I was keeping an eye on, there was the risk of missing it had I not been listening to podcasts.

Newsletters are the real goldmine for interviews. If there was just one newsletter I had to choose from, it would be the weekend pitch by Pitchbook. The amount of detail, statistics, case-specific information and concise writing offered by Pitchbook makes it an invaluable resource for forming the foundation of any long-term trend you decide to build on.

Go deep on a few key trends rather than going shallow on everything. Your list might start with 3 and then grow towards covering more.

For example:

  • Regulation of tech-giants and Lina Khan as new antitrust chief in US
  • Consolidation of the food delivery market
  • M&A trends overview
  • Electrification of the automotive sector
  • ESG revolution
  • Decentralised finance and cryptocurrency/blockchain applications e.g. Cardano case study
  • E-sports market experiencing tailwind of growth
  • 5G Connectivity and Smart Cities
  • Internet of Things (IoT)/ Operational Technology (OT) security: representing a simultaneous threat to companies and opportunities for cy ber security start-ups

You might also want to read Ray Dalio’s book on The Changing World Order since it looks at the seismic shifts happening in the global economy in the context of recurring patterns that have been occuring for centuries and millenia.

A few quick notes:

I have included ESG Revolution deliberately here because although it is a very broad trend to follow, I was asked ‘tell me about ESG’ in an assessment centre with RBC. After receiving such a broad question, I now think it is paramount to have at least some initial breakdown of key updates in large global movements like ESG – even if it means focusing on one Environmental news story, one Social news update and one Governmental policy indicating the acceleration of ESG initiatives as a whole.  One of the toughest things about commercial awareness is having a healthy balance of breadth and depth i.e. being able to broadly discuss such a far-reaching topic and then go specific on aspects of that topic.

Similarly, I was asked about ‘M&A Trends’ several times across my interviews so this is more of a ‘compulsory’ general story to cover despite again it being so broad. The hack for M&A Trends is consulting reports, which is discussed in more detail below.

Alongside a summary of key developments of the trend, write up how this will impact your chosen division and include statistics to prove you are detail-oriented.

Once you choose a trend, make a Word doc summarising in your own words the key points from that trend. Then handwrite an A4 summary which you will sometimes need to update and I found this another indispensable resource to review ahead of any interview.

Harness Consulting Reports

Finally, search for free consulting reports on your trend of interest – this is commonly what analysts in the industry would go for. You will be surprised at how many free resources are available to search e.g. through Mckinsey, Bain, BCG, the Big 4 and many others. I found the Big 4 to provide excellent M&A trend reports, as well as tech reports, and that the other 3 provided some great deep dives into niches within particular sub-sectors. The consulting reports will help you cherry-pick statistics and case-specific information for your case studies.

Most importantly, enjoy the process as commercial awareness is something that goes well beyond the interview and that although can be the most difficult component, can also offer the most fulfilment as it continues to compound.

Tell Me About a Recent M&A Deal

How to answer “tell me about a recent merger & acquisition deal” with a simple hack:

Firstly, credits go to Patrick Gorton for telling me about this technique called the deal cookie-cutter method – finding others in a similar position to yourself when applying is something I cannot recommend enough. Whether that is to join an interview study group or arranging weekly mocks, it is these practices that will ensure you see the most development.

Here is what the deal cookie-cutter method consists of:

Brief Overview of the Deal

Keep this line concise.

If you are struggling to find a recent deal, you could go straight to the source and type in “[Bank Name] Press Release”, which should yield some useful search results.

Three Key Rationale Behind the Deal

For these points, you could stick to the press release, or use sites like MergerSight and the Financial Times for extra commentary on the deal.

Remember to include case-specific points and at least 1 statistic. There is the risk however of going too detail-oriented and although I recommend learning more than one statistic, prepare for a more condensed version during the interview and be open to giving more details if the interviewer probes you.

Example of where extra research might play a role: In a Perella Weinberg Partners 2nd round interview after I spoke about the PayPal acquisition of Honey, I was asked what I would advise to other payment providers/competitors following the acquisition. This question is where extra research can come in handy but most of the time, the interviewer is just looking to check the box that you can articulate concise, well-researched commercial awareness responses.

Why it Interests You

This section is where you can tie in your commercial awareness preparation and make a good response an exceptional one… which is key in such a competitive process.

For example, if looking at the Groupe PSA/FCA merger and you want to involve trends from the automotive sector, you could include details from McKinsey’s article titled “Mobility’s second great inflection point”.

I also recommend tying in the why it interests you to why you want to work at that particular firm e.g. the deal might show how the firm is at the forefront of facilitating the transition to a low-carbon economy through helping larger incumbents acquire innovative startups, or it might show the exciting exposure you would get as a summer analyst in such a complex unfolding trend.

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