Check out the English translation of Camil Driessen’s write up on the 2015 ModelOff Finals and Willem Gerritsen’s awesome result! For our friends from the Netherlands, you can find the original article in Dutch here.
Good in Excel? Join the World Championship!
Camil Driessen – December 5, 2015
With red hair, a furrowed brow of intense concentration and lightly bent towards the computer screen, Willem Gerritsen from Wijk bij Duurstede goes into battle. Together with an Irishman from Deutsche Bank, a Bank of America Merrill Lynch employee from Hong Kong, a New Zealander from PwC and 12 others.
“Four hours and ten minutes of hammering behind my PC”. This is how Gerritsen describes his battle in the finals of ModelOff: The Financial Modeling World Championship, held this week at Cardinal Place, Microsoft’s London headquarters. The preliminary rounds start with 4,000 contenders from more than 100 different countries, but only sixteen competitors remain in the finals to decide who is the best in the World at financial modeling.
The first version of Excel, the popular spreadsheet software, was marketed by Microsoft in 1985. Nowadays, it’s being used by more than 500 million people worldwide. In the world of finance, it is a crucial tool for private-equity firms, investment banks and consultants.
“Excel is the tool with which you justify paying so many billions of dollars for this takeover, and so many billions of dollars for that company,” according to Matt Porzio, vice president of software firm and ModelOff global sponsor Intralinks. “Many of our clients active in the M&A world live on Excel”.
A scientific correlation hasn’t yet been proven, but the rise of Excel mid-way through the 1980s coincided with an enormous rise in the worldwide value of mergers and acquisitions. This year’s total value is around $4.570 billion, almost as much as the record year of 2007. Porzio suspects that without Excel an amount like this would be unthinkable. “If you didn’t have Excel, you wouldn’t do deals like that, and you won’t get any financing for it. Takeovers are all being calculated through and through with financial models built in Excel”.
However, ModelOff is not just focused on praising Excel, but celebrating the “intellectual athletes”, says Australian co-founder Johann Odou. “The participants have a fantastic quality that is often not recognised by others. If we honour people who shoot a ball into a net, why not people who deliver an intellectual achievement?”
When Odou was working for a Melbourne-based investment bank in 2011, the idea for ModelOff came to them whilst sitting in a bar with a friend. A year later they organised the first edition with the help of – amongst others – Microsoft.
Nowadays, ModelOff has a broader range of sponsors including Intralinks, S&P Capital IQ, AMT Training and KPMG. And Odou has a company called PSCL, the Professional Services Champions League, which acts kind of like an International Olympic Committee for professionals in the financial and business world. It also organises World Championships for actuaries and data analysts. And next year in Hawaii there will be a 24-hour multidisciplinary intellectual championship based on the Ironman.
However, in London the contenders had much less time: just over four hours for four tasks. According to the Judging team, in this short period of time the competitors were able to make extremely good financial models, and find answers to complicated questions. For example, how a company can optimally allocate and depreciate machinery and what the chance is of selecting a certain combination of chips from a big pot.
“I really hope that clients won’t see this, as it will be hard to justify our rates,” jokes Judge Luca Blasi, who works as the head of Risk Valuation at Deutsche Bank.
And, as football players are really attached to their own football shoes, the sixteen finalists all took their own computers to London: HP, Lenovo, Toshiba, but an Apple was nowhere to be found.
“I even bought a monitor at PC World in Kensington this week,” says Gerritsen about his match day setup. The Excel consultant also brought his own keyboard and wireless mouse with him. Gerritsen found out about ModelOff one and a half years ago through Googling whether there was an Excel World Championships somewhere. He then participated in the two online preliminary rounds, and was promptly invited to the finals in New York. “Only then I didn’t bring a monitor, so I had to work on a screen that was far too small”.
So he could improve on that performance this year. There was definitely something at stake: the best three of the world will receive, besides the eternal fame, cash prizes of respectively 10,000, 5,000 and 3,000 British Pounds. The World Champion additionally receives the Golden Keyboard trophy. A keyboard with one crucial detail: the F1-key is missing. This key tends to make hardcore Excel users go completely nuts, as it triggers a help screen which takes a couple of seconds to click away.
The F1 key is next to the F2 key: one of the most important keys in Excel with which you edit formulas. The Excel experts frequently use the F2 key (and often accidentally miss it and end up with F1). “A lot of Excel users like me removed the F1 key from their keyboard,” says Porzio who handed out first prize.
After Gerritsen finished all the tasks, he was certain that he wouldn’t take the Golden Keyboard back to The Netherlands. Is a podium finish possible? A small chance, he says, “25% at max”. And after Alvin Woon of Bank of America wins the third prize (and 3,000 pounds), Gerritsen is pretty sure he’s going to end up winning nothing.
With a smile from ear to ear he’s at the podium one minute later, when his name comes out of the envelope and the 150 attendees in the room are cheering loudly. “Really unexpected”, a beaming Gerritsen says after a congratulatory kiss from his wife, Inge.
Australian Joseph Lau from Commonwealth Bank was crowned the overall winner. At 43 years, he is the oldest finalist and was full of praise for everyone present at the final. Lau joked that, “The final of the World Championships is good for our career and ModelOff shows we’re not freaks!”