The Top 10 Financial Modeling Career for you!

 The skill of financial modeling is fast becoming one of the more popular and in-demand skills in the industry. Those who have acquired this skill will often find themselves having an upper hand over the rest of their peers. Owing to the steadily increasing generation of digital data, companies and organizations are keen to employ professionals and specialists that can organize the data generated, create assumptions regarding the same, analyze and forecast what it is that the company should do in the future, and therefore provide insights and recommendations to improve functioning and output.

Traditionally, the analysis associated with financial modeling was considered in careers pertaining to investment banking, however, it has seeped into various other careers of the finance industry and is considered to be a fundamental skill in these as well. 

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Listed below is our compilation of the Top 10 careers in Finance that consider financial modeling a baseline skill: 

1. Investment Banking

Undergoing one of the many finance certification courses available online in India can lead to a stable foundation for a career in investment banking. Investment banking is considered to be the original career of financial modeling. Investment bankers are required to regularly build models on Excel for advisory mandates, capital raising, and for the valuation of companies for mergers and acquisitions (M&A). 

2. Equity Research 

Equity research associates and analysts are required to spend a large portion of their time on Excel, building different financial models and analysing the company’s performance as well as researching a specific industry. This work, information and data is compiled into a structured report that is sent to the clients of a bank. This report is used to identify potential for investment in public security. By participating in finance certification courses that are suitable to your requirements, you could develop the assets required to build a stable career. 

3. Financial Planning and Analysis (FP&A) 

All large companies contain a department that is referred to as Financial Planning and Analysis and is responsible for generating forecasts on the company’s performance, drawing comparisons with the forecasts and generated results as well as monitoring of the cash flow in the business. Analysts are required to perform complex analysis and financial modeling, ensuring that the company can plan ahead and is well-funded for the same. Researching and participating in online finance courses in India can enable development in this career. 

4. Corporate Development 

Large public companies contain corporate development groups that are responsible for raising the capital of the company, divestitures, mergers and acquisitions. Choosing and completing one of the many finance certification courses available can allow employees of these groups to work closely with investment bankers and ensure execution of transactions. Professionals in corporate development are required to have remarkable skills in financial modeling as they are likely to build models regularly from scratch. 

5. Private Equity 

Private equity is responsible for acquiring and holding onto the business for a long period of time. Professionals in this career build a spreadsheet that enables a leveraged buyout. These are crucial for the successful completion of the transaction and requires capital structure modeling of a complex nature. This is one of the less common jobs in the industry but makes good use of the skill of financial modeling. 

6. Venture Capital 

Venture Capital firms are required to make investments in the early stages of companies with the potential for high growth. Therefore, financial models are used to draw up estimates on the value of the businesses being considered. While financial modeling isn’t used all the time, owing to the early state nature of the company, there are many instances along the way where they are used. The financial modeling in this career places primary focus on the rate at which a company loses cash in a short duration of time - referred to as burn rate. 

7. Commercial Banking 

The professionals who participate in investment banking require excellent skills in Excel to analyse a company’s capacity to service any debt and satisfy the credit metrics and covenants of the lender. This is a job however, that is not very complex and certification in financial modeling can prove to be an asset. 

8. Real Estate Development 

Real estate developers are required to build extremely detailed models that illustrate the profitability of any project in real estate development. Therefore, a typical cash flow analysis is built and the internal rate of return (IRR) of a project is calculated. Therefore, a solid foundation in financial modeling would be an asset in this career. 

9. Mezzanine Finance 

Mezzanine lenders are lenders that provide a certain sum which ranks between equity and debt in a business's capital stack. They are required to take more risks than traditional lenders, but they often assume risk that is lesser than that of equity investors. To be able to assess different deals and opportunities, they work on building valuation models that take into consideration the debt and equity features of the investment that they are considering. 

10. Start-Ups 

Entrepreneurs that are beginning with their organizations would require operating models that can accurately predict the company’s revenue generation, cash flow and expenses in the future. Startups usually burn through their capital in the early years of its conception, making it important to ensure that the company has enough to continue survival until the next financial round begins. 

Keeping in mind these many different careers in the industry of Finance, it goes without saying that specialization in financial modeling would provide a firm foundation for the building of a career in this field.