Corporate Finance: A Necessary Evil
Date: January 15, 2016 | Posted By: USDBLS
Some of us came to law school as the next carefully orchestrated step in a detailed life plan. The rest of us wound up in law school because we graduated with semi-useless degrees like philosophy, political science, humanities, or sociology and we simply didn’t know what else to do. I am in the latter group, and like many of my colleagues I have three primary goals: create a career I can be proud of, make enough money to pay off my student loans and eat, and continue avoiding math in all its forms for as long as possible. Unfortunately, this last hope was shattered when I became interested in studying business law. As it turns out, a basic understanding of finance is, if not necessary, than at least quite helpful.
As my interest in commercial transactions and corporate law blossomed, so too did my realization that I must face my age-old nemesis: math. So, in the fall of 2015 I enrolled in Corporate Finance. Like many of my classmates, I anticipated a primarily concept driven discussion of corporate finance strategies and motivations. Needless to say, I was a bit disheartened when I realized I was actually expected to solve for variables, read graphs, and find something called a log. Despite Professor Barry’s spirited teaching style and reassuring catchphrase of “easy peasy,” I spent the duration of the class trying to recall basic high school algebra and feeling like a was about twenty steps behind the rest of the class. Soon, however, my other classes began considering things like the time value of money, corporate capital structure, and stock options. Amazingly, these concepts made sense in the context of Corporations and Bankruptcy class discussions because I had already examined these topics in excruciating detail in Corporate Finance
To wrap up, I will share three things I wish I had known before the first day of class. First, there will be a few engineering undergrads in your class who have taken the course to boost their GPAs—ignore them, the rest of the class is just as confused as you. Second, if you haven’t taken statistics (like for example, you chose to take a foreign language instead) you should Google some basic concepts and ponder them before the class begins. Third, this is a math class and you must be prepared to understand and perform basic mathematical operations. Although I spent the vast majority of the class wading through a quagmire of long forgotten algebra and statistics, I believe this class provided a foundational understanding of what drives the business world, legal or otherwise.
In sum, take Corporate Finance, but be prepared.
Author: Lauren Titchbourne, 2L Juris Doctor candidate at the University of San Diego School of Law.