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by nknealk
2159 days ago
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I just finished an MBA in June. A few thoughts outside of what’s been mentioned here already: If your company is publicly traded, learn about the variety of SEC filings that most C-level executives are responsible for. In particular, learn how to parse the footnotes of 10K/S1 filings — an income statement might be 1-2 pages but the footnotes are often 30+ pages. The interesting choices a company makes are often in the footnotes. For example, the related party transaction for WeWork’s “We” trademark that everyone was up in arms about appears on page 199 of the filing. Finance is about cashflows. GAAP accounting is about subjectively spreading costs across periods. The two are often at odds. Learning to navigate both and knowing which your audience cares about is critical. You often need years of context about a business to be able to make contributions on this front. |
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1. Understanding the domain language and key processes of all the business units that you didn’t already, which is by the way all of them. The heightened ability to engage in their own domain terms with everyone in a standard company is a social and cognitive upgrade.
2. Finding actionable insights (sometimes dramatically so) within your customers, partners, and competitors financial statements.
3. Recognising your own decision biases. (Whether you bother correcting for them is another matter)
Interestingly I feel the most under-rated of these is #1, to the extent that many of us in tech carry the mistaken assumption that we already know all the machinery of firms, having learned it “on the job” or by deriving the existence of tax accounting from first principles. Unless you’ve been a general manager or founder already this is almost certainly a self-delusion. I can say it was for me, I am a mathematics major who appended the MBA twenty years later and despite directing many successful enterprise-scale projects and lurking around Day 1 startups for aeons still had scales removed from my eyes.
Never under-rate the value of understanding other people better; there is no diminishing return, quite the opposite, it is compounding.