The interview wasn’t going all that badly until he asked: “How would you compare and decide between multiple internal investment opportunities?”  In retrospect, it’s not that hard of a question, but at the moment I was a bit taken-a-back.  Wait a minute – don’t you want to hear about the time I took feedback well?  Or the time I tackled an analytical challenge? 

I blathered for a few minutes about evaluating risks & revenue before hitting on the answer.  I think he was looking for something about probability-weighted discounted free cash flows, but it took us a while to arrive there.  There’s the wake-up call.  Thankfully, that’s the only one this week… I have five more days to prepare for HBS’ “Dedicated Interview Period”, the first week of February where they cancel all the classes and let students wade through day-long interviews.  Can’t wait!!!

1. Consulting: 4 of 8
2. Tech: 1 of 7
3. Biotech: 3 of 4
4. Finance: 1 of 4
5. Industry: 0 of 2 

All told, that gives me a hit rate of 9 of 25 (or 36%).  In my target industries (ie, the top three groups above where I thought there was a reasonable chance of an invitations), it’s even a little better: 8 of 19 (or 42%).  I’m pretty excited about this… from the little I’ve heard from my colleagues, this was a difficult year for interview invitations.  Many people walked away with only 1 or 2 when they were expecting far more. 

I was a little shocked that I failed so miserably in the technology area!  While I don’t have any direct industry experience, I do have some functional expertise and (at least, I thought), a pretty “why I’m interested and would be amazing” cover letter.  I think those jobs just must be incredibly oversubscribed at HBS.  It  sounds like a lot of the “career consultants” (the kids who plan on going back to consulting) applied to these jobs.  Spending the summer in San Francisco working for Google is fairly attractive regardless of where you’d ultimately like to end up! 

Anyway, it’s going to be a busy two weeks prepping for interviews!  Wish me luck!

As part of a continuing effort to rebrand myself as a healthcare acolyte, I went to the club-led Healthcare Conference this past weekend.  While I haven’t mentioned them much here, conferences are a continual part of the HBS experience.  There are probably conferences on at least 80% of the weekends here (examples: the VC/PE conference, the Middle East conference, the Entrepreneurship conference, the Women’s Association conference — they’re everywhere!)  They’re usually pretty amazing, too — HBS can leverage the name & student body to bring in some major heavy-hitters.

I’ve found that I’m usually exhausted of business stuff by the weekend, so I rarely take advantage of these events.  I mean, seriously, who wants to spend all day Saturday in a conference when they’re in class / reading cases for 9+/hr day every weekday?  Alas, job searches require sacrifice, so I stayed most of the day:

1. Keynote with the CEO of Intuitive Surgical
2. Personalized Medicine with a Pres. of Genzyme & a VP of Medco
3. Biotech/Pharma with Directors of Genentech & Merck
4. … among others.

Personalized Medicine Panel

Pharma / Biotech Panel

Of course, the real point of conferences is networking. I think this is lost on many people.  Sure, the panels will be interesting and all, but it’s really about meeting the people next to you, walking around during the breaks, and talking over lunch / cocktails.  I didn’t pursue it all that aggressively (I was mainly there to have something to chat about during interviews), but it’s surprising to me how many people just sit there and take copious notes.  It’s not like the panelists are going to say anything that you can’t find on-line!  That said, here are a few of my informational takeaways:

1. Robotic-assisted surgery is an amazing technology!  There was a short video clip of a doctor peeling a grape with precision robotics… very cool.  The market thinks so, too: Intuitive already has a 70% share of complex prostate surgery and has seens almost 300% CAGR!  I wish I had invested in this…
2. More $ were spent last year on diagnostics than on the last 20yrs combined.  Most of the Personalized Medicine panelists see diagnostics (coupled with pharma-solutions) to be the new key to the marketplace.
3. The pharma panel was particularly interesting.  Three huge questions: Why is pharma still vertically integrated when almost every other industry has disaggregated? (answer: 20yr product life cycle… or maybe they’re finally experimenting with specialization…?)
4. What’s big pharma going to do when all drugs fall off patent by 2012? (answer: acquire biotechs with full pipeline…?)
5. What’s going to happen in the face of an even more difficult pricing environment: excess sales & manufacturing capacity, int’l price caps? (answer: consolidation…?)

After a quick examination of my rapidly declining investment account, I decided to go with the $150 week-long Boston Healthcare IXP (instead of the $5-$10k total expenditures required for some of the more exciting Treks and IXPs).  It wasn’t quite the same as standing on The Great Wall while opining about Chinese trade barriers, but it did have a few interesting moments:

• The “History of Surgery” from the Pres. of the Int’l Transplantation Soc. along with a slew of other Harvard Med. Professors.
• A discussion on Medical Errors with a Chief of Surgery at BWH with an afternoon of touring the BWH Simulation facility.
• A lecture / case with Michael Porter of “Five Forces” fame and recent co-author of Redefining Healthcare.
• Pharma Research from a director at Novartis with an afternoon of touring the R&D facility.
• Regulation with the former Commissioner of the FDA and the former Administrator of Medicare.
• Venture Capital w/ 4 Healthcare VC Partners!

So, a lot of impressive speakers.  HBS really has the power to draw in some amazing people when it comes to these sort of things.  All-in-all, I think I learned a lot, but it does make me realize how much I love the case method.  It’s much more difficult to pay attention for 90-minutes when it’s just one guy talking, no matter how interesting he is.  Unless he’s flashing graphics-rich powerpoint slides 4x/minute in a multimedia presentation, it’s just too easy to let your mind wander.  My top 5 takeaways from the IXP:

1. Healthcare is complex.  Delivery is complex.  Diseases are complex.  There are few elegant or simple mechanisms here, and it’s definitely a quagmire.
2. Hostility towards business, profits, and competition is unusually high, from almost ALL of the players.  Huge (and highly explanatory) implications here.
3. Untapped potential for economies of scale are HUGE!  Metrics clearly show that specialized centers with high volume have far better outcomes, but still, even the leading centers only serve <1% of the US market.
4. Risk tolerance is virtually nil, and has been declining for years.  Many of the key discoveries which have saved many lives wouldn’t have taken place in today’s environment.
5. Average industry profitability for Pharma. is 10-15% and has been declining rapidly over the years (as is inevitable as industries mature).  It takes 12-15 yrs from patent to market & the FDA success rate is only 11%.

As a side note, it was also interesting to hear the panel of VCs talk about the challenge of presenting the VC-industry in a good light.  As their “10 year results” window moves past the biotech boom in 1999, their returns are going to be negative!  Shocking and disappointing… so much for becoming a VC!