Author: Pamela Tom

Team from Africa Wins Global Social Venture Competition with Anti-Malaria Soap

| by Pamela Tom

One of the most dangerous animals in the world is one that often goes unnoticed—the mosquito. 

About half of the world population is at risk of contracting malaria, reports the World Health Organization. Of the 219 million people affected in 2010, there were 660,000 deaths, 90 percent of which occurred in Africa, where malaria is the leading cause of death.  Faso Soap—an organization from Burkina Faso, a small landlocked country in Africa, that is addressing the problem through an effective, easily adoptable mosquito-repelling soap—won this year's Global Social Venture Competition (GSVC) $25,000 Grand Prize.

Faso Soap is the brainchild of Moctar Dembélé and Gérard Niyondiko, two students from 2iE Foundation, an international higher-education and training institute. Using natural ingredients found locally in Burkina Faso, the team can produce its soap inexpensively while creating local jobs and reducing the medical expenses and loss of income associated with malaria.

“Malaria is a huge problem not only in our country, but in all of Africa,” Dembélé said in the team’s project presentation. “We wanted a simple solution. Everyone uses soap in Africa, even in the poorest communities. Faso Soap doesn’t require any change of behavior.”

The win marks the first time a student team from Africa has won the GSVC Grand Prize. The team—which also won the Blum Center for Developing Economies $1,500 People’s Choice Award—was among the nearly 650 competitors from 37 countries that entered the GSVC this year, including 19 Haas-affiliated teams, nine of which were chosen to compete in the U.S.-Western Regional Finals.

A total of 18 finalists gathered at Haas April 11 and 12 to compete for $50,000 in prizes at the Global Finals. The GSVC, started in 1999 by Berkeley MBA students, helps aspiring entrepreneurs create businesses that have a positive social impact. The competition is hosted by the Lester Center for Entreperneurship with the support about 25 MBA students. The first prize is sponsored by the Dow Chemical Co. 

The other 2013 winners were:

  • Carbon Roots International (Second Place, $15,000), a Haiti-based team that will produce “green charcoal” and a carbon-negative soil fertilizer from agricultural waste—products that will reduce deforestation via a low-cost alternative (non-wood) cooking fuel and help small-plot farmers achieve higher crop yields.
  • PulpWorks Inc. (Third Place, $7,500), a U.S. team that addresses the worldwide plastics pollution problem via a biodegradable, compostable, pulp-and-paper alternative to toxic plastic packaging.
  • Jorsey Ashbel Farms (Center for Responsible Business Quick Pitch Award, $1,000), a Nigerian team that produces innovative livestock feed, low-cost protein foods and has developed an effective distribution system to combat the problem of protein-energy malnutrition, which affects millions of disadvantaged children and women.

More information about the winning teams can be found on the GSVC Facebook page and will soon be posted at gsvc.org.

GSVC Winners: Gérard Niyondiko and Moctar Dembélé, of Faso Soap, the first student team from Africa to ever win the Grand Prize.

Berkeley MBA Students Meet Oracle of Omaha

| by Pamela Tom

A group of 20 Berkeley MBA students flew to Omaha, Neb., April 11 to meet with legendary investor Warren Buffett, CEO and primary shareholder of Berkshire Hathaway.

Students kicked off the visit with a tour of the Nebraska Furniture Mart, the largest home furnishings store in North America, which was bought by Berkshire Hathaway in 1983. After the tour, students met with Buffett for a two-hour Q&A session followed by lunch at one of his favorite restaurants, Piccolo Pete’s, an Italian steak house.

The group later toured other Berkshire Hathaway companies, including jewelry retailer Borsheims and the party supplies retailer Oriental Trading Company, where students were introduced to the company CEOs.

“It was a once in a lifetime experience,” says Bryan Wong, MBA 14, co-president of the Haas Investment Club and a Haas Investment Management Fellow. “The opportunity to meet Warren Buffett and for him to spend three to four hours with students is unbelievably precious.”

Wong described Buffett as “incredibly humble and down the earth.”

Aside from meeting Buffett, the highlight of the trip for Joanne Xu, MBA 14, was hearing from the people who run his companies. She said she left with a better understanding of why people work so hard to support Buffett. “People are very loyal to him, and he puts a lot of trust in them,” says Xu, a student in the Evening & Weekend Berkeley MBA Program.

During the Q&A, students took turns asking Buffett about business, investing, and life—everything from what he expected his philanthropic legacy would be to his succession plan to his take on socially responsible investing.

Buffett predicted there will be more bubbles and more buy opportunities in our lifetimes, and said the trick is knowing whether a company has lost its edge permanently or is in temporary crisis, says Bill Rindfuss, executive director for strategic programs in the Haas Finance Group, who accompanied the students.

“It was like getting a physics lesson from Albert Einstein,” Rindfuss says.


Berkshire Hathaway CEO Warren Buffett meets with Berkeley MBA students.

(See below for full group photo.)

Haas Awards Honor Four Outstanding Staff

| by Pamela Tom

Haas staff were celebrated at a spirited luncheon April 14, marking a year in which the school launched the new Berkeley MBA for Executives Program, became a university leader for Operational Excellence initiatives, and set records in Annual Fund giving and Executive Education revenues.

Dean Rich Lyons also honored four staff members with Outstanding Staff Awards linked to the school's four Defining Principles (pictured left to right): Anthony "Joe" Magliaro; Fani Garagouni; Pat DeMasters; and Sojourner Blair (not pictured).

Beyond Yourself: Anthony, "Joe" Magliaro, Interim Supervisor, Senior Financial Services Analyst

Magliaro has navigated many organizational challenges, including the successful transition of payables from the Berkeley Financial System (BFS) to BearBuy. He designed and led the BearBuy training efforts for both the Business Services Office as well as the financial support staff of the many Haas program offices.

"His unfailingly positive attitude and communication and diplomacy skills have greatly assisted Haas when addressing customer service issues with other departments as well as the central campus offices," said Lyons upon presenting the award at the Bancroft Hotel. "He tactfully but effectively argues positions that are often contrary to procedural norms and his devotion to ethics and professionalism has been a model for team members."

Question the Status Quo: Pat DeMasters, Director, Part-time MBA & Alumni Career Management

DeMasters was hired in 2006 to improve career services for a then-underserved group of students and has since developed numerous programs to meet the unique needs of the part-time MBA and alumni populations.

"With very constrained resources she developed a robust set of offerings by questioning assumptions at every turn," said Lyons. "She is highly student-centric and works toward a ‘yes,’ even when it means removing some obstacles." DeMasters was also hailed for empowering her staff to think outside of the box to deliver services using technology and other resources, which has resulted in an array of virtual services.

Confidence without Attitude: Sojourner Blair, Assistant Director, Undergraduate Admissions

Blair’s accomplishments this year included coordinating twice as many part-time readers, implementing a new admissions interview component with alumni, and managing a long-term project to move to a paperless admissions process. She also piloted online technologies, such as advising webinars, to reach a wider audience of prospective students and developed a new admissions evaluation tool to record and analyze real-time reader scores (without a budget).

"It’s not just what she gets done, but how she gets things done," said Lyons. "She confidently leads teams and works in collaboration. Her colleagues describe her as being confident without attitude."

Students Always: Fani Garagouni, Assistant to Jennifer Chizuk, Senior Assistant Dean and COO, and Alice Kubler, Assistant Dean, Budget and Operations

Garagouni consistently takes advantage of learning and development opportunities at Haas and Cal, improving not only her own skills, but her unit and the school in the process. She was responsible for the successful transition to a new Café operator.

"Her learning and development mindset serves as an inspiration to us all to approach work with openness and curiosity," said Lyons. "She seeks support and knowledge from her co-workers, but does not shy away from leading efforts."

 Said Garagouni, "When you work with Jennifer Chizuk and Alice Kubler, you’d better be a Student Always! Every day I learn lessons beyond what I could have imagined. Haas is an amazing environment."

Joe Magliaro, Fani Garagouni, Pat DeMasters

Undergrads Take First in Georgetown Stock Pitch Competition

| by Pamela Tom


Winners: Charles Sun, BS 13 (EECS), president of the Berkeley Investment Group (BIG); Jeff Totten, BS 13, executive adviser of BIG; Franklin Yin, BA 16 (Math), BIG equity research officer; and Jordan Tipton, BS 16, BIG equity research officer.

A deep drill-down into the natural gas industry helped a Berkeley Investment Group team with two Haas undergrads take first place Saturday in the Georgetown Stock Pitch Competition.

The winning team, which took home $2,000, consisted of Jeff Totten, BS 13; Jordan Tipton, BS 16; Charles Sun, BS 13 (Elect. Engineer. & Computer Sci.); and Franklin Yin, BA 16 (Math). Their pitch for GasLog—an international owner, operator, and manager of ships that carry liquefied natural gas—beat out teams from such schools as Wharton, Darden, and Georgetown's own McDonough School.

In the first round, the Berkeley Investment Group team defeated Darden and George Mason University in a 10-minute pitch followed by 10-minutes of Q&A with judges. In the final round, which was judged by representatives from Sands Capital and Credit Suisse, the team defeated Georgetown, Miami University, and James Madison University.

“Our experience as officers at Berkeley Investment Group thoroughly prepared us for the competition, both in terms of researching and developing a compelling investment thesis and in terms of presenting it," says Tipton, a first-year Haas student and one of the club's equity research officers.

The Berkeley Investment Group is the largest investment club at UC Berkeley with more 400 members, 20 officers, and a portfolio of more than $70,000 of real investments. The Haas-sponsored club hosts weekly educational meetings, manages a real mutual fund, teaches the Introduction to Wall Street Decal course, and consults for investment managers.

The winning team began exploring the natural gas industry in December after reading a Wall Street Journal article on the projected increase in natural gas exports from the United States. After investigating supply, demand, and export numbers, students concluded that the liquefied natural gas shipping industry will benefit most from the natural gas boom.

"This brought us to GasLog, which we believe is the best public pure-play on the industry," explains Yin, a first-year mathematics major and another equity research officer. "A lot of work went into this thesis so we were happy with the result.”

The first place finish was the third in a row at national competitions for the Berkeley Investment Group. Previous victories include the group’s Diamond Foods pitch at the 2012 Georgetown Competition and its Express Scripts pitch at the 2012 Michigan Interactive Investments Conference.

"We like competing with students from the top business schools," says Totten, executive adviser to the Berkeley Investment Group. "But the highlight of the Georgetown and Michigan conferences is meeting students with similar professional interests."

Corporate Accounting Earnings Data Relevant for Determining Value of the Aggregate Stock Market

| by Pamela Tom

While teaching a course on financial information analysis, Asst. Prof. Panos Patatoukas observed that capital market participants and policy makers are increasingly turning to accounting earnings data from corporate financial reports for hints regarding the prospects of the aggregate stock market. This observation indicated that, at the aggregate level, accounting earnings data could be relevant for gauging the value of the entire stock market.

Patatoukas, Haas Accounting Group, became so intrigued that he decided to undertake an in-depth investigation of the information that decision makers interested in stock market valuation could extract from accounting earnings data aggregated across publicly traded firms in the U.S.

Patatoukas’ study, “Detecting News in Aggregate Accounting Earnings: Implications for Stock Market Valuation” is published in The Review of Accounting Studies (March 2013).

Patatoukas’ study develops a theoretical framework for understanding the relation between aggregate accounting earnings and stock market valuation. Patatoukas shows that this relation is complicated by the fact that stock market prices are very sensitive to even small revisions in investors’ expectations about discount rates. His study provides strong empirical evidence that this is the case.

Using a comprehensive sample of U.S. publicly traded firms from 1981 to 2009, Patatoukas shows that aggregate accounting earnings are tied to news about both expected future cash flows and discount rates. A comprehensive investigation of the link to discount rates reveals that aggregate accounting earnings are tied to news about the real riskless rate, expected inflation, and the expected equity risk premium (i.e., the expected excess return of the stock market over the nominal riskless rate). In fact, over the sample period studied, cash flow news and discount rate news in aggregate accounting earnings move together and have opposite impacts on the value of the aggregate stock market. An increase in expected future cash flows is positive for valuation, while an increase in discount rates is negative for valuation. Importantly, however, prices capture the net impact of cash flow news and discount rate news and so the stock market appears to be insensitive to aggregate accounting earnings.

“My findings illuminate the importance of separating cash flow news from discount rate news when evaluating the information content of aggregate accounting earnings for the stock market valuation,” says Patatoukas.  “Although the stock market appears to be insensitive to aggregate accounting earnings that does not mean that accounting earnings data are not informative. In fact, aggregate accounting earnings are very relevant for determining the value of aggregate stock market!”

Patatoukas’ theory and evidence has the potential to change how capital market participants and policy makers use accounting data from corporate financial reports when making inferences at the aggregate stock market level. “Maybe it is not a pure speculation to expect that future research will uncover even more evidence on the relevance of aggregate accounting data for stock market valuation,” says Patatoukas.

See full paper.

While teaching a course on financial information analysis, Asst. Prof. Panos Patatoukas observed that capital market participants and policy makers are increasingly turning to accounting earnings data from corporate financial reports for hints regarding the prospects of the aggregate stock market. This observation indicated that, at the aggregate level, accounting earnings data could be relevant for gauging the value of the entire stock market.

Watch YouTube Documentary on Sight-Impaired Alum’s Polar Trek

| by Pamela Tom

At the end of 2011, Alan Lock and Andrew Jensen, both MBA 11, trekked 570 miles over 28 days from the Antarctic Shoreline to the South Pole. For Lock, the Polar Vision trek—now captured in a new YouTube documentary—was the culmination of a journey that began when he suddenly lost most of his eyesight to macular degeneration at the age of 23 while serving aboard a British submarine.

Forced to leave the Royal Navy, Lock continued to follow his passions, exploring the ends of the world while testing his own physical limits. These passions led him through blistering heat over a seven-day, 151-mile run through the Sahara Desert, across the pavement-pounding punishment of over ten marathons, and finally, through rough and stormy seas, where Lock set a world record as the first visually impaired person to row across the Atlantic Ocean.

After the row, Lock attended Haas, where he worked with a practicum at the Boalt School of Law to form a 501c3 called Polar Vision. With the support of his family, friends, classmates, and professors, Lock partnered with classmate Andrew Jensen and Richard Smith, a friend who earned his MBA at Tuck, and spent two years planning, training, and fundraising before setting a second world record by reaching the South Pole upon the 100th anniversary of its discovery by mankind.

By completing this expedition in unforgiving winds and temperatures that often fell below -40 degrees Fahrenheit, Lock became the 312th person in the last 100 years to ski from the Antarctic coastline to the Pole. By comparison, there were more than 500 summits of Mt. Everest in 2010 alone.

The Polar Vision documentary, shot mainly on hand-held cameras by expedition members, shows how Lock, a person with little previous cold weather experience and no skiing ability at all, overcame his own limits to achieve this lifelong goal. It also illustrates how the problem-solving skills the team acquired in their MBA programs, military service, and management consulting roles allowed them to quickly form a team in a high-risk environment.

Released only on YouTube at PolarVisionChannel, the Polar Vision page will continue to add bonus content about the trek during the month of April.

Lecturer Daniel Mulhern Receives Teaching Award from Students

| by Pamela Tom

After joining the UC Berkeley faculty only two years ago, Haas Lecturer Daniel Mulhern has been awarded the seventh annual ASUC Golden Apple Award for Outstanding Teaching.

The Golden Apple Award allows students to nominate and vote for their favorite professors on campus. Mulhern, who teaches courses on leadership in the Haas School and the UC Berkeley School of Law, said he was grateful to receive the honor.

“I really love my students, and I love ideas. When students want to learn and grow, I’m in heaven every day,” Mulhern said. “I’m learning as much as I’m teaching, every day I walk into the classroom.”

In the fall of 2012, Mulhern taught Leadership: Purpose, Authority and Empowerment, an undergraduate business administration course examining topics in organizational behavior and industrial relations, as well as Holistic Leadership, a public policy course that examines current problems and issues in the field of public policy.

“I don’t think there’s any other professor that deserves it more,” said UC Berkeley senior Kunal Agarwal, one of Mulhern’s students. “He spends time just trying to make a personal connection with every single student in the class. He takes the aspirations students have and makes them a priority for himself.”

Mulhern’s initial response to learning he had won the award was “abiding disbelief.” For him, the fact that his students nominated and mobilized to vote for him was “very, very gratifying.”

According to Academic Affairs Vice President Natalie Gavello, this year, the votes were close. However, Mulhern “stood out in the quality of the votes, in addition to having more votes than any other professor,” she said in an email.

Prior to his time at UC Berkeley, Mulhern authored two books on leadership. He is currently the president of Dan Mulhern Inc. and Granholm Mulhern Associates, a successful leadership firm.

Mulhern has been asked to deliver his “ideal last lecture” in late March, in accordance with the guidelines and selection criterion of the award. He will also be presented a cash grant to aid him in continuing to create a positive intellectual community for Berkeley students.

The award started almost 10 years ago when an ASUC senator wanted to honor an outstanding professor.

This article by Mia Shaw originally ran in the Daily Californian.

Study Finds Successful Entrepreneurs Share a Common History of Getting in Trouble as Teenagers

| by Pamela Tom

Watch Prof. Ross Levine discuss his research. 

Independence. Creativity. Money. Those are the benefits associated with successful entrepreneurs such as Steve Jobs and Mark Zuckerberg. But is being an entrepreneur really more lucrative than working for a salary? And who is best cut out to succeed? A new study by Professor Ross Levine of the Haas Economic Analysis and Policy Group answers both of these questions.

Levine and co-author Yona Rubinstein of the London School of Economics and Political Science found that entrepreneurs earn on average 50 percent more than their salaried counterparts who are working in the same industry and have the same education, contrary to a large body of research finding that entrepreneurship does not pay. Levine explains that many previous studies broadly define entrepreneurship, including people who are self-employed such as an accountant or a plumber. In this study, an entrepreneur is defined as a person who undertakes a novel, risk-taking activity. Levine says think Michael Bloomberg or Bill Gates.

Furthermore, they found that successful entrepreneurs possess distinct traits identifiable back when they were teenagers. These traits turn out to be accurate predictors of entrepreneurial success. Some of the not-so-surprising traits include having a high IQ, coming from a stable family, having parents who earn a higher than average income, and having exceptionally high self-esteem and confidence. However, some other common traits are often associated with juvenile delinquency.

“Our data revealed that many successful entrepreneurs exhibited aggressive behavior and got in trouble as teenagers. This is the person who wasn’t afraid to break the rules, take things by force, or even be involved in minor drugs,” says Levine, the Willis H. Booth Chair in Banking and Finance.

The researchers combed data from the National Longitudinal Survey of Youth (NLSY79), a representative sample of 12,686 young men and women who were 14 to 22 years old when they were first surveyed in 1979. The interviews have continued ever since.

“What we find is that a particular constellation of traits turns out to be a strong predictor of who is going to become an entrepreneur later in life and whether that person is going to be a high-earner when he or she launches a business,” says Levine.

In terms of earnings, the study found that successful entrepreneurs displaying these traits typically started their careers as top high earning salaried workers, and when they branched out on their own and successfully established their companies, they tended to enjoy a boost in earnings of 70 percent more than they received as salaried workers.

See full paper.

Independence. Creativity. Money. Those are the benefits associated with successful entrepreneurs such as Steve Jobs and Mark Zuckerberg. But is being an entrepreneur really more lucrative than working for a salary? And who is best cut out to succeed? A new study by Professor Ross Levine of the Haas Economic Analysis and Policy Group answers both of these questions.

 

Morgan Stanley Exec Named Senior Associate Director of Financial Engineering Program

| by Pamela Tom

Stefanie Montevirgen will join the Master of Financial Engineering (MFE) Program March 4 as senior associate director, bringing deep recruiting experience from Morgan Stanley to the post.

Montevirgen will work alongside Executive Director Linda Kreitzman to place financial engineering students in internships and full-time positions.

As director of MFE/PhD campus recruiting at Morgan Stanley, Montevirgen was responsible for recruiting and hiring students for the Morgan Stanley Strats & Modeling Quantitative Finance Program. In her role, she developed a Women’s Quantitative Finance Mentorship Program to attract PhD’s with a quantitative discipline into finance and partnered with managing directors globally to design effective university recruiting strategies. She is particularly experienced interviewing students for investment banking positions.

Montevirgen began her career at Take Two Interactive Software as a junior human resources generalist. She graduated from Columbia University with a master’s in organizational psychology after completing a bachelor’s degree in psychology at UC Irvine.

Financial Engineering Students Win Competition with Basel III Models

| by Pamela Tom

A diverse team of Berkeley-Haas Master of Financial Engineering (MFE) students from three countries and six professions bested 31 competitors to win the annual International Association of Financial Engineers competition.

The winning team, announced Feb. 7 in New York, consisted of Alfred Haohan Yuan (team captain), Lisa Yanfei Li, Allen Yan Wang, Yi Zhang, Shivesh Gupta, and Arnab Chakrabarti, all MFE 13. The team won $1,000 and an invitation to present its solution at a New York event of the International Association of Financial Engineers, the nonprofit professional society that sponsored the competition.

Berkeley-Haas MFE students have been the victors of the competition for each of the two years since its launch. This year the competition asked students to model the impact of Basel III regulations on the level of capital held by banks and suggest regulatory improvements. Basel III is the global regulatory framework governing how much leverage banks can employ, what level of equity capital banks need to support their leveraged portfolios, and the liquidity of their portfolio assets.

Students also had to apply their methodology to the 2007 subprime and 2010 Euro debt crises and detail how their improved regulation scheme would help to stabilize global financial system.

The Berkeley MFE team spent four weeks on its model while working in full-time internships in New York and San Francisco, relying on weekend conference calls to coordinate efforts. The students attributed their success to their MFE classes and their variety of backgrounds.

"This paper really was a combination of everything we learned in the MFE Program," says Haohan, who won the 2012 Morgan Stanley Prize for Excellence two months ago. "We were able to apply what we learned from several classes." Those classes included Optimization in Finance, Fixed Income, Financial Risk Management, Empirical Methods, and Credit Risk.

The students also brought diverse academic backgrounds to the team, including statistics, economics, electronic engineering, finance, mathematics, and computer science. "The wide variety helped us think about the same problem from different directions," says Gupta.

Responsible Business Think Tank Names Prof. David Vogel a Top Thought Leader

| by Pamela Tom

Trust Across America, an organization dedicated to improving and supporting responsible business practices by U.S. companies, has named Professor David Vogel one of 2013’s Top 100 Thought Leaders in Trustworthy Business Behavior.

The author of 15 books, Vogel has been at the forefront of research on corporate social responsibility (CSR) throughout his academic career. He became a faculty member in Berkeley’s business school in 1973. He holds the Soloman P. Lee Chair in Business Ethics and serves as editor of California Management Review, the Haas School’s management research journal.

Other thought leaders on the Trust Across America list include Virgin CEO and founder Richard Branson, Starbucks CEO Howard Schultz, New York Times columnist and Pulitzer Prize winner Thomas Friedman, and faculty from Harvard, Georgetown, Kellogg, and Darden.

In his most recent book, The Politics of Precaution (Princeton University Press, April 2012), Vogel examined case studies and risk regulation in U.S. and European companies and found regulations–once more stringent in America–have become less comprehensive and innovative than those in Europe.

Vogel’s first book, Lobbying the Corporation: Citizen Challenges to Business Authority (1978),　examined the impact of shareholder activism and consumer boycotts on redefining the social role and responsibilities of business during the civil rights, anti-war, and anti-apartheid movements.

Vogel says while sweatshop abuses have been replaced with environmental and sustainability issues, he is pleased that CSR has become a permanent part of management practice and has been institutionalized in corporations.

Vogel considers his 2005 book,　The Market for Virtue: The Potential and Limitations of Corporate Social Responsibility,　to be his most important scholarly contribution to the study of business-society relations. In this book, Vogel presents a balanced, well-researched assessment of CSR’s accomplishments and limitations in improving labor conditions, human rights, and environmental conditions in the global economy.　The Market for Virtue　won the best book award from the Social Issues Division of the Academy of Management in 2008.

"I have tried to strike a balance between seeing the potential of CSR and also its structural limitations in terms of the constraints that markets impose on companies to behave responsibly," says Vogel. "This is a controversial point. People who focus on CSR strongly believe in the business benefits of CSR, and that the more responsible firms are, the more profitable they will be. Unfortunately, there is little evidence that more responsible firms are more profitable. But what is encouraging is that neither are they less profitable."

Trust Across America provides information, standards, and data to encourage people to transform the way organizations do business. 2013 marks its third annual Top Thought Leaders list.

"The honorees are inspiring organizations to look more closely at their higher purpose…to create greater value for, and trust from, all of their stakeholders. They understand that trust is an asset that can leverage real business gains," says Barbara Kimmel, Trust Across America’s co-founder.

Read Trust Across America's 2013 Top 100 Thought Leaders in Trustworthy Business Behavior

Skydeck Wins Catalyst Award

| by Pamela Tom

Skydeck, the UC Berkeley startup accelerator in downtown Berkeley, won the Catalyst Award at the first-ever East Bay Innovation Awards celebration Jan. 31 in Oakland.

Skydeck was recognized for its commitment to supporting startups as a partnership that involves the city of Berkeley and the university. Skydeck was created a year ago as a collaboration of the Haas School, the College of Engineering, and the UC Berkeley Vice Chancellor of Research Office to develop an entrepreneurial ecosystem for the university community, including Lawrence Berkeley National Lab.

Currently, Skydeck is providing office space, mentoring, and workshops to 17 teams from UC Berkeley.

The East Bay Economic Development Alliance presented the first annual East Bay Innovation Awards to recognize cutting-edge businesses and organizations that are making the East Bay one of the nation's preeminent regions of innovation. Winners were selected by independent industry professionals after a public nomination process.

Learn more about Skydeck

Watch a video about one Skydeck startup, Dreambox

Watch a video about the East Bay Innovation Awards

Investor Beware: Stock Analysts’ Rounded Forecasts Are More Inaccurate and Upwardly Biased

| by Pamela Tom

In an era when a stock can take a beating if earnings fall a penny short of analysts’ predictions, what factors influence whether forecasters seek precision to the penny or round off — and how should their choice affect investors?

Berkeley-Haas Accounting Professor Patricia Dechow found that rounded forecasts are not only significantly more inaccurate than those that strive for penny-precision but also significantly more upwardly biased. The sharpest differences in both respects occur in companies with annual earnings per share of less than $10.

Dechow is the Donald H. and Ruth F. Seiler Professor in Public Accounting and a member of the Haas Accounting Group. The study, “Analysts’ Motives for Rounding EPS Forecasts,” co-authored by Haifeng You of the Hong Kong University of Science and Technology, was recently published in the American Accounting Association’s Accounting Review.

Dechow’s research shows rounded estimates for firms with earnings per share of less than a dollar (amounting to about 26 percent of the sample) are on average about 70 percent more inaccurate than unrounded ones and almost 125 percent more upwardly biased. For companies with annual earnings per share between $1 and $10 (accounting for about 61 percent of the study’s total sample), rounded estimates are on average about 40 percent more inaccurate and 68 percent more upwardly biased than those that are unrounded.

The study also finds that the market takes rounding into account in its response to analysts’ forecasts. Investors responded less to earnings surprises when forecasts were rounded than when they were not. Investors also anticipated the upward bias of rounded forecasts, though not fully.

Previous research has found that analysts who rounded tended to work for small brokerage firms, to have relatively poor prior records of accuracy, to update their forecasts only infrequently, to have long forecast horizons, and to follow an above-average number of firms from multiple industries. Dechow’s research confirms these findings and  corroborates the counterintuitive earlier discovery that experienced analysts tend to round more often than less seasoned colleagues, perhaps “because they are compensated less for accuracy as their tenure with the firm increases.”

“Analyst incentives impact the likelihood of rounding,” Dechow explains in her article. “.Analysts can choose to be less informed about a particular stock and this choice affects how certain they feel about their forecasts, and, as a consequence, their decision to round…Analysts have limited time and so will rationally focus their forecasting efforts on firms for which the benefits of doing so are the highest.”

And what firms yield the most benefits? The study identifies these:

Firms with relatively small earnings per-share

About 34 percent of forecasts are rounded when annual earnings per share (EPS) is $1 or less, in contrast to 49 percent when it is from $1 to $10 and 60 percent when it is from $10 to $100. According to the authors, “As the level of EPS increases (1) the economic importance of the penny digit declines and so is less relevant to investors, and (2) the precision of the analyst’s information is not as likely to hold to the penny.”

Firms with high stock-trading volume

As the authors explain, a high-volume stock “offers greater opportunities for trades to pass through the brokerage division.” Analysts who provide more informative research are likely to generate more trading business, and this can benefit the analyst…In contrast, low trading volume offers fewer brokerage fee opportunities.”

Growth companies

Although assessing the prospects of growth firms “requires the analyst to exert effort and incur higher information-gathering costs to determine potential future opportunities…investors are also more interested in growth companies because of the greater potential gains, and this creates an increased demand for analyst guidance…Low-growth firms are likely to be less lucrative for the employers of analysts, and so we expect less forecasting effort.”

Companies that offer investment-banking business opportunities

Regulators have assumed that the potential to procure investment-banking business for their employers leads analysts to inflate the prospects of a stock. In addition, the study finds that it inspires the extra effort required of precise forecasts. In the words of the study, “Firms that are raising financing frequently select the investment bank that has a favorable analyst following the firm to underwrite the deal. Understanding this relation, an analyst who is covering a firm that is likely to need financing is likely to exert more effort in forecasting [and will be] less likely to round forecasts.”

Small companies or those with few business segments

The tendency to round increases with company size and complexity. In the words of the study, “larger firms are more complex than small firms, making them more difficult to analyze and value. In addition, if an analyst does provide an informative report, then this information is likely to be quickly dispelled among market participants and not necessarily captured by the analysts’ brokerage division.” As for number of segments, “companies with complicated business models require more effort to understand and therefore impose more costs on analysts…Controlling for firm size, firms with more business segments will have more rounded forecasts.”
What practical lessons can investors derive from the study? “Generally to be a little wary of rounded analyst forecasts,” Dechow says, “particularly for small companies or high-growth firms with heavily traded stocks (especially if they’re likely to want to raise money soon) or simply companies with low earnings per share. Those are all characteristics that should motivate precise forecasts. If they don’t, it could very well be a tip-off to hurried or cursory analysis.”

In an era when a stock can take a beating if earnings fall a penny short of analysts’ predictions, what factors influence whether forecasters seek precision to the penny or round off — and how should their choice affect investors? Accounting Professor Patricia Dechow found that rounded forecasts are not only significantly more inaccurate than those that strive for penny-precision but also significantly more upwardly biased. The sharpest differences in both respects occur in companies with annual earnings per share of less than $10.

Haas Professors Teece, Gârleanu, Morse Honored for Excellence in Research and Scholarly Service

| by Pamela Tom

Berkeley-Haas professors David Teece, Nicolae Gârleanu, and Adair Morse have been honored for their research achievements and excellence in their respective academic fields.

Prof. David Teece, the Thomas W. Tusher Professor in Global Business and faculty director of the Institute for Business Innovation, received the Royal Honour of Companion of the New Zealand Order of Merit.  Associate Prof. Nicolae Gârleanu , the Paul H. Stephens Chair in Applied Investment Analysis, is the winner of the Smith Breeden Prize from the Journal of Finance. Assistant Prof. Adair Morse, a visiting professor in the Haas Finance Group, is the recipient of the Journal of Finance’s Brattle Prize.

 

David Teece
Royal Honour

Teece received the Companion of the New Zealand Order of Merit for his services to New Zealand/United States relations. It is a Royal Honour and is made by the Governor General on behalf of Queen Elizabeth II.  The Order of Merit is awarded to those “who in any field of endeavor have rendered meritorious service to the Crown and nation or who have become distinguished by their eminence, talents, contributions or other merits.”

Teece holds multiple directorships of business and policy groups and is a leading scholar in the fields of corporate strategy and innovation.  A 2008 analysis by Thomson Scientific found him to be one of the top-10 most-cited scholars in economics and business from 1997 to 2007. He has been recognized by Accenture as one of the world’s top 50 business intellectuals. In addition, he is among the “A-List of Management Academics 2011,” an honorary group of 30 accomplished and distinguished U.S. business professors. He holds four honorary doctorates.

In 2001, Teece cofounded the Kea Global Network. The not-for-profit organization aims to increase trade by providing New Zealand businesses with greater access to international markets and U.S. companies’ greater access to the New Zealand and Australian markets.  Teece has assisted many startup companies in the United States and elsewhere. Teece also pioneered Mt. Beautiful Vineyards in North Canterbury, New Zealand.   In addition to his role at Berkeley-Haas, Teece is chairman of the Berkeley Research Group LLC (BRG), a global consulting firm that provides expert testimony, strategic advice, and data analytics to government and private businesses.

 

Nicolae Gârleanu
Smith Breeden Prize

Each year, the Journal of Finance recognizes three finance research papers (other than corporate finance) for excellence. Gârleanu’s winning paper, “Technological Growth and Asset Pricing,” is co-authored by Stavros Panageas of the University of Chicago’s Booth School of Business and Jianfeng Yu of the University of Minnesota’s Carlson School of Management.

The paper explores the phenomenon that financial-asset returns tend to predict such “real’’ quantities as GDP growth. The reason is that stock and bond prices react instantly to news of technological breakthroughs, such as the Internet, while implementation and achieving economies of scale in production can take many years.

“Given that such breakthroughs tend to happen only occasionally, technological cycles arise naturally. The breakthrough is made and, at some later time only, early adopters start implementing the technology, followed by more and more firms, until it permeates the entire economy,” says Gârleanu.  “Our paper models this phenomenon and carefully studies its implications for financial returns (such as stock prices and interest rates) and real quantities (e.g., GDP), and in particular the relation between the two throughout a cycle.”

Gârleanu is also the 2012 recipient of the Review for Financial Studies’ prestigious Barclays Global Investors Michael Brennan award for his paper, “Margin-Based Asset Pricing and Deviations from the Law of One Price,” co-authored by Lasse Pederson, NYU’s Stern School of Business.  The paper found that assets with virtually identical cash flows, such as corporate bonds insured with default swaps (CDS) and Treasury bonds, offered different returns during the financial crisis because lower margin assets present lower risk and require a lower capital contribution from investors.

 

Adair Morse
Brattle Prize

Morse’s paper on how to use psychology-induced methods to improve disclosure on consumer borrowing products earned her the prestigious, first place Brattle Prize. The prize is awarded annually by the Brattle Group, an economic and financial experts consultancy, for outstanding papers in the field of corporate finance published in the Journal of Finance.

Morse’s paper, “Information Disclosure, Cognitive Biases and Payday Borrowing,” was co-authored by Marianne Bertrand of the University of Chicago’s Booth School of Business. The authors assert that individuals who borrow quick cash from payday lenders may not use this service optimally because they may not fully understand the product or because they have biases about their own behavior, such as their ability to pay back a loan quickly.

The study showed that disclosing more information on the accumulation of fees over time from using  payday loans impacts borrowing decisions. Getting consumers to think about the broader implications of payday loans, in particular to adding up of costs over time, they found, reduced the amount of borrowing by about 11 percent in a four-month  window following exposure to the new information.

“I was elated to hear my name announced for the Brattle Prize. It is such a thrill to know that the best minds in finance voted to honor me for my research,” says Morse.

See more Berkeley-Haas research awards.

Prof. David Teece, the Thomas W. Tusher Professor in Global Business and faculty director of the Institute for Business Innovation, received the Royal Honour of Companion of the New Zealand Order of Merit.  Associate Prof. Nicolae Gârleanu , the Paul H. Stephens Chair in Applied Investment Analysis, is the winner of the Smith Breeden Prize from the Journal of Finance. Assistant Prof. Adair Morse, a visiting professor in the Haas Finance Group, is the recipient of the Journal of Finance’s Brattle Prize.

Finance Professor Ulrike Malmendier Receives 2013 Fischer Black Prize

| by Pamela Tom

Berkeley-Haas Finance Professor Ulrike Malmendier has been awarded the 2013 Fischer Black Prize from the American Finance Association, which honors the top finance scholar under the age of 40 years old.  The prize was announced to the public Jan. 7, 2013.

The prize was established in 2002 in honor of Fischer Black, who was a co-inventor, along with Myron Scholes, of the Nobel-prize winning Black-Scholes-Merton Options-Pricing Model. The prize is modeled after the Fields Medal in mathematics and the Clark Medal in economics.

Prof. Ulrike Malmendier
Prof. Ulrike Malmendier

Malmendier is the fifth recipient of the biennial prize. (No prize was awarded in 2005, when no candidate met the standards.) She holds a joint position as a professor of economics at UC Berkeley, which she joined in 2006, and has been at Haas since 2010.

“I’m thrilled and honored that the American Finance Association selected me for the award from a very select group of people,” says Malmendier.  “I can’t fully believe that this has actually happened yet.”

The American Finance Association’s award citation referred to Malmendier’s work in corporate finance, behavioral economics and finance, contract theory, and the history of the firm, particularly noting the originality and creativity of Malmendier’s research.

“The Fischer Black Prize is one of the most prestigious academic prizes—this is a great honor for an outstanding scholar,” says Berkeley-Haas Dean Rich Lyons. “We are delighted that the finance profession has recognized Malmendier’s accomplishments, and we’re proud that she’s a member of Berkeley-Haas.”

Malmendier feels particularly thankful for the recognition since her area of research, the intersection between economics and finance or behavioral corporate finance, is less mainstream.  Malmendier says, “I have always been interested in both economics and finance and in particular, why and how individuals make decisions—specifically how individuals make mistakes and systematically biased decisions. Some applications are in finance, but often my research questions are far from mainstream finance.”

One of Malmendier’s recent research papers, “Depression Babies: Do Macroeconomic Experiences Affect Risk-Taking?” published in the Quarterly Journal of Economics in 2011 with co-author Stefan Nagel of Stanford, is representative of the originality and creativity of  her research. The paper shows that groups of people who have experienced macro-economic shocks such as low market returns, for example, tend to take less risk later in their lives, and vice versa.

“Malmendier’s results have been observed anecdotally, but she was able to show them econometrically, which is not easy to do,” says Haas Finance Professor Terry Odean, who holds the Rudd Family Foundation Chair and chairs the Finance Group at Berkeley-Haas.

Another research paper, “Paying Not to Go to the Gym,” published in the American Economic Review in 2006 and co-authored with Berkeley Economics Professor Stefano DellaVigna, shows that people with monthly gym memberships tend to use their membership far too infrequently to justify the monthly dues – paying per visit would be much cheaper. Regardless, they tend to stay enrolled rather than cancelling it. Odean says, “For a gym member to actually end their membership is to admit that they won’t exercise—that they give up.  From an economist point of view, this is interesting because it is expensive to maintain this membership and to get no value out of the membership.”

Andrew Rose, associate dean and faculty chair at Berkeley-Haas and professor of economic analysis and policy, is proud of Malmendier and the school’s entire finance faculty who have recently won numerous awards, “In addition to Ulrike Malmendier’s Fischer Black Prize, Professor Adair Morse has recently won the Brattle Prize for the best corporate finance paper published in the Journal of Finance, and Professor Nicolae Gârleanu has recently won the Smith Breeden Prize for the best finance research paper in the Journal of Finance in any area other than corporate finance.  We have much to celebrate with our outstanding finance faculty.”

Two Undergrad Alumni Named Most-admired CEOs by San Francisco Business Times

| by Pamela Tom

Two Haas undergraduate alumni—Joy Chen, BS 87, of Yes To, and Andy Kurtzig, BS 94, of Pearl.com—were among the 15 winners of the San Francisco Business Times 2012 Most-admired CEOs Award.

Chen, who won in the small business category, became CEO of Yes To in 2009 after serving as the vice president and general manager of Clorox’s Laundry Strategic Business Unit. Yes To markets a line of natural skin and hair care products made from organic fruits and vegetables under the Yes To Carrots, Cucumbers, Grapefruit, Blueberries, Tomatoes, and Baby Carrots brands.

The six-year-old company has 25 employees and annual sales of $50 million. Its products can be found in more than 25,000 stores in 25 countries. In her first two years as its leader, Yes To flipped from negative cash flow to positive, grew its top and bottom lines, and quadrupled its revenue. Yes To also operates a nonprofit organization, which awards grants to schools in the U.S. and Africa enabling them to plant gardens that will feed thousands of students.

Kurtzig, who was chosen as the rising star winner, created his first company Anser Corp., which produced calendar automation software for newspapers, while still a student at Haas.  In 2003, he founded JustAnswer.com, now Pearl.com, a company that offers interactive online professional advice to consumers—for a price—from more than 10,000 professionals, ranging from doctors and lawyers to mechanics and computer technicians. Pearl.com earned $85 million in revenue in 2011, recently closed a Series A funding round of $25 million, and currently has 150 full-time employees.

The Most-admired CEO winners were selected by a panel of industry judges in conjunction with the San Francisco Business Times and honored at an event at the Four Seasons Hotel San Francisco late last year.

Silicon Valley Business Journal Spotlights Alum at eBay

| by Pamela Tom

Chris Plasser, MBA 04, head of product at RedLaser, part of eBay mobile, made the "40 under 40" list compiled by the Silicon Valley Business Journal last month.

The list features "amazing people under the age of 40 impacting their industries and their communities." The honorees on the list were nominated by their peers and selected by a committee to represent the best of Silicon Valley.

Plasser, who hails from Austria, joined eBay to work at PayPal on new payment solutions, including mobile transactions. For the last year and a half, he has been overseeing a startup-like team of 19 employees, including product managers, designers, and engineers, on cutting-edge mobile shopping experiences. He has grown use of RedLaser from 13 million to 22 million users in one year.

Finance Professor Ulrike Malmendier Receives 2013 Fischer Black Prize

| by Pamela Tom

Berkeley-Haas Finance Professor Ulrike Malmendier has been awarded the 2013 Fischer Black Prize from the American Finance Association, which honors the top finance scholar under the age of 40 years old.  The prize was announced to the public Jan. 7, 2013.

The prize was established in 2002 in honor of Fischer Black, who was a co-inventor, along with Myron Scholes, of the Nobel-prize winning Black-Scholes-Merton Options-Pricing Model. The prize is modeled after the Fields Medal in mathematics and the Clark Medal in economics.

Malmendier is the fifth recipient of the biennial prize. (No prize was awarded in 2005, when no candidate met the standards.) She holds a joint position as a professor of economics at UC Berkeley, which she joined in 2006, and has been at Haas since 2010. 

“I’m thrilled and honored that the American Finance Association selected me for the award from a very select group of people,” says Malmendier.  “I can't fully believe that this has actually happened yet.”

The American Finance Association’s award citation referred to Malmendier’s work in corporate finance, behavioral economics and finance, contract theory, and the history of the firm, particularly noting the originality and creativity of Malmendier’s research.

“The Fischer Black Prize is one of the most prestigious academic prizes—this  is a great honor for an outstanding scholar,” says Berkeley-Haas Dean Rich Lyons. “We are delighted that the finance profession has recognized Malmendier’s accomplishments, and we’re proud that she’s a member of Berkeley-Haas.”

Malmendier feels particularly thankful for the recognition since her area of research, the intersection between economics and finance or behavioral corporate finance, is less mainstream.  Malmendier says, “I have always been interested in both economics and finance and in particular, why and how individuals make decisions—specifically how individuals make mistakes and systematically biased decisions. Some applications are in finance, but often my research questions are far from mainstream finance.”

One of Malmendier’s recent research papers, “Depression Babies: Do Macroeconomic Experiences Affect Risk-Taking?” published in the Quarterly Journal of Economics in 2011 with co-author Stefan Nagel of Stanford, is representative of the originality and creativity of  her research. The paper shows that groups of people who have experienced macro-economic shocks such as low market returns, for example, tend to take less risk later in their lives, and vice versa. "Malmendier’s results have been observed anecdotally, but she was able to show them econometrically, which is not easy to do, ” says Haas Finance Professor Terry Odean, who holds the Rudd Family Foundation Chair and chairs the Finance Group at Berkeley-Haas.

Another research paper, “Paying Not to Go to the Gym,” published in the American Economic Review in 2006 and co-authored with Berkeley Economics Professor Stefano DellaVigna, shows that people with monthly gym memberships tend to use their membership far too infrequently to justify the monthly dues – paying per visit would be much cheaper. Regardless, they tend to stay enrolled rather than cancelling it.  The paper says, “For a gym member to actually end their membership is to admit that they won’t exercise—that they give up.  From an economist point of view, this is interesting because it is expensive to maintain this membership and to get no value out of the membership.”

Andrew Rose, associate dean and faculty chair at Berkeley-Haas and professor of economic analysis and policy, is proud of Malmendier and the school’s entire finance faculty who have recently won numerous awards, “In addition to Ulrike Malmendier’s Fischer Black Prize, Professor Adair Morse has recently won the Brattle Prize for the best corporate finance paper published in the Journal of Finance and Professor Nicolae Gârleanu has recently won the Smith Breeden Prize for the best finance research paper in the Journal of Finance in any area other than corporate finance.  We have much to celebrate with our outstanding finance faculty.”

Read More about Malmedier's Research in a UC Berkeley News Center Article

Innovation in Action: MBA Grad Brings Haas@Work to Life at Wells Fargo

| by Pamela Tom

When Amir Zelazny, MBA 09, applied to the Haas@Work Program for spring 2009, he was a second-year full-time Berkeley MBA student uncertain of his future in the thick of the recession. Little did he know that after graduation he would go on to work for his Haas@Work client, devoting the next three-and-a-half years to building the kernel of an idea from the program into a major new strategy for one of the nation’s biggest banks.

Zelazny, now an assistant vice president and product manager for Wells Fargo’s Retirement Solutions group, became a driving force behind the bank’s proprietary new retirement tool. The "My Retirement Plan" tool launched Dec. 14 as the first part of a new program to help Wells Fargo customers prepare and save for retirement. The tool aims to guide consumers with realistic plans for saving for their sunset years.

“This really underscores how the innovation process works, and how it can be used to make big changes in a big organization,” says Zelazny. “Our Haas@Work team of students brought fresh ideas to Wells Fargo. After graduation, I worked on a team at Wells Fargo that did additional research to enhance the calculator idea, and then we put in the work to develop and launch it—with lots of twists and turns along the way.”

Haas@Work has evolved from an extracurricular program to a semester-long course that satisfies MBA students' experiential learning requirement.   Each semester, the course is built around specific innovation opportunities and challenges faced by prominent partner companies. Teams of Haas students—along with faculty and advisers—then spend 16 weeks working with the companies, uncovering new insights about customers and the market, and developing, modeling, validating, and advancing new ideas and novel solutions. 

Zelazny was part of a student team asked to wrestle with multi-layered challenge for Wells Fargo: how could the bank help customers do a better job saving for retirement? After the initial program ended, he and economics PhD student Reza Shabani continued on with Wells Fargo as contractors, developing and testing an algorithm for a new retirement calculator that incorporates government data and takes customers' day-to-day situations into account. The calculator proved unique enough to take out a patent.

Zelazny was hired on by Jeff Street, Wells Fargo’s senior vice president for Retail Retirement, to shepherd it through a complex user-experience design process, which incorporated behavioral economics and development of multiple channels: online, phone, and bank branches.

“In the end, this innovation came about through a combination of tearing apart an initial idea to come up with the core math behind "My Retirement Plan," followed by literally thousands of decisions about how every element of the customer experience, channel integration, and technology would work,” Street says. “All to deliver an easy-to-use but highly powerful tool to help our customers better succeed in saving for retirement.”

Executive Director Dave Rochlin says the goal of Haas@Work is two-fold: Students hone their innovation skill set while partner companies get solid recommendations and fresh perspectives.

“In this case, Wells Fargo not only picked up some deep insight and thoughtful new approaches related to encouraging retirement planning, they also hired a talented Haas graduate to bring our processes inside their organization,” he says. “It's a big win for everyone."

Zelazny said the project “feels like the fruition of all the principles I learned at Haas, such as questioning the status quo and going beyond yourself.”

Amir Zelazny, MBA 09

Media Shines Spotlight on Two Companies with Haas Origins

| by Pamela Tom

Two Bay Area companies hatched and nurtured through the Berkeley MBA Program recently received some high-profile coverage: Indiegogo, an online crowdfunding platform, was showcased in a Financial Times article, and TubeMogul, a media buying platform for video advertising, was featured in an Advertising Age article on the company’s recent $20 million Series C round of funding.

Launched in 2008 by co-founders Danae Ringelmann and Eric Schell, both MBA 08, and Slava Rubin, Indiegogo began as a social marketplace for independent filmmakers to raise money. It has since become a global crowdfunding platform, “empowering anyone, anywhere, anytime, to raise funds for any idea.” This move beyond movies was fueled in part by $15 million raised in funding earlier this year from sources including Insight Ventures and Khosla Ventures. That was the largest amount ever raised by a crowdfunding company, the Financial Times noted.

 “There are so many ideas that go unborn every day because the people who have them don’t have the right connections,” Ringelmann told the Financial Times. “It’s not for lack of brilliance or heart or work ethic—they just don’t have a rich uncle or a connection to a bank.” She told Haas last February that Indiegogo has helped to level the playing field, including directing “a much higher percentage of capital to women entrepreneurs.”

Andre Marquis, executive director of the Lester Center for Entrepreneurship, told the Financial Times that many Berkeley MBA students and alumni use Indiegogo to fund their startups. He called Ringelmann “an especially inspiring figure to women entrepreneurs,” and said, “It’s great to have such a vibrant role model in Danae.”

Employing some 20 Haas or Cal alumni, TubeMogul, co-founded by Brett Wilson, John Hughes, and Mark Rotblat, all MBA 07, shifted from a service to help video publishers track viewer data to a video marketing company integrating real-time media buying, ad serving, targeting, optimization, and brand measurement. The service has been used by everyone from ad agencies to film studios and presidential candidates.

The founding trio met in a Haas entrepreneurship class and went on to spend a year working in the school’s startup incubator. "The Lester Center was just an awesome launch pad to help us create TubeMogul," Wilson has said. "Absolutely couldn't have done it without Haas."

Advertising Age highlighted TubeMogul’s recent round of funding, which was led by Northgate Capital and included previous investors Trinity Ventures and Foundation Capital. The Series C funding brought the total raised by TubeMogul to $35 million. Wilson told Advertising Age the company will use the funds to aggressively hire in engineering, sales, and marketing and to expand into more international markets. Wilson also reported that TubeMogul tripled revenue in 2012 to more than $50 million, split evenly between the ad-buying technology and video ad network businesses.