Valentine’s Day consumer spending will look different this year, according to an expert from Rice’s Jones Graduate School of Business.

“Lower consumer confidence and uncertainty about the overall economy will shape Valentine’s Day spending trends — not the other way around,” wrote Constance Porter, assistant clinical professor of marketing at the Jones School, for WalletHub.

Over the past couple of years, Americans who felt good about the economy and their personal finances fueled strong spending on Valentine’s Day gifts, according to data published by the National Retail Federation. But this year, Porter believes, the pandemic will dampen Valentine’s Day spending.

“Performative gifting,” acts of generosity intended to impress both the recipient and observers, will be harder due to lockdowns and travel and restaurant limitations, according to Porter.

Instead, she suggests more people will opt for alternative ways to celebrate at home — such as cooking a restaurant-style meal or taking online courses for at-home spa treatments. It’s the “physical labor of love” that will make these experiences special, Porter said.
 

“The entire effort feels more fulfilling because our special someone put forth an extra effort,” she wrote.

Indeed, she says even single people may be inclined to find a special way to celebrate the day at home. A National Retail Federation survey found that 35% of respondents age 18-25 said “treating yourself” when asked about their Valentine’s Day plans.

“Given the isolation for some folks during the pandemic, Valentine’s Day is the perfect opportunity to boost mental health and wellness with some budget-friendly self-love activity at home,” Porter wrote. “It is never a bad time to do something special for yourself, like cook a favorite meal or order your favorite flowers. Valentine’s Day is the perfect excuse for self-indulgent behavior.”

Owl Have You Know

Jonathan McAdams ’01 joins Christine Dobbyn to talk about his career journey and working in finance. Along the way, Jonathan describes his experience in high-net worth and hedge funds and comments on the stock market during the pandemic.

Subscribe to Owl Have You Know on Apple Podcasts, Spotify, Youtube or wherever you find your favorite podcasts.

Rice Graduates Excel on CPA Exam

With an average pass rate around 50%, the four-section CPA Exam is known to be a challenge. In 2019, though, 91% of Rice graduates who took sections of the CPA Exam passed on their first attempt. According to a report recently issued by the National Association of State Boards of Public Accountancy (NASBA), that gave Rice the second-highest pass rate among first-time test takers in the nation!

That 2019 performance was no fluke. In 2018, Rice also ranked second among all universities in the country.

What makes Rice’s CPA Exam rate even more impressive is that the majority of these Rice test-takers hadn’t majored in accounting or business as undergraduates. Instead, Rice Master of Accounting students hail from majors as diverse as economics, environmental science, French, kinesiology, piano performance, political science, psychology and sport management.

One Exam, Four Separate Sections

While the name “CPA Exam” implies an exam that you’d take in a single sitting, it’s actually comprised of four separate sections that are taken individually. Most test-takers schedule each section weeks apart from one another so they can devote the needed time studying for each section.

While test-takers can re-take any section that they fail, you must pass all four exam sections within an 18-month window to pass the CPA Exam. Obviously, the best-case scenario is to pass all four sections on the first attempt.

Rice MAcc graduates typically sit for all four exam sections during the four months after completing their degree. The 91% of Rice test-takers who passed all four sections on their first try in 2019 completed the entire exam before or shortly after they started their full-time job. That allowed them to fully focus on their new career without having to study for the CPA Exam after work and over weekends.

Elijah Watt Sells Winners

Rice graduates also have demonstrated their success on the CPA Exam with their record of winning the Elijah Watt Sells Award. For three consecutive years, one of our MAcc graduates has won this prestigious award by earning one the nation’s very highest scores on the exam. 

You can learn more about the Elijah Watt Sells Award and our previous winners here: Top CPA Exam Score Winner -- Third Year in a Row!

Are you interested in getting qualified to sit for the CPA Exam? Click here for more information about our admissions process. To find out whether the Rice MAcc is a good fit for you, reach out to us today!

Why did you choose Rice Business?

Rice Business is a family of people who are intentional about showing up with empathy and lending their expertise beyond the classroom to ensure that you have a meaningful MBA experience. It was evident from the moment I stepped on campus that this was a space where I could genuinely learn, connect and thrive. Our dean, Peter Rodriguez, would say we are a community striving to strike the perfect balance between IQ and EQ.

What are you most proud of from your time at Rice Business?

In a time when the world seems caught in the grips of racial divide, I am immensely proud that Rice Business has doubled down on its commitment to attract talented students of color. The Consortium for Graduate Study in Management is a non-profit that supports top business schools in building a pipeline of brilliant business leaders from underrepresented backgrounds. Rice Business has invested so intensively in this mission that the number of Consortium fellows has more than doubled over the last two years. As Rice-Consortium chapter president, I've had the honor of leading the school's largest cohort to date. I am inspired daily by our family of fellows, and I am assured that the future of business is in the hands of bright, capable, resilient leaders.

How has your Rice Business experience supported your entrepreneurial or career accomplishments?

Over the summer, I interned with Google in their Googler Experience, Transformation and Strategy space. On my very first day, I was given the green light to help tackle a complex and ambiguous problem that impacted several of the organization’s key stakeholders for years. I was assigned the most amazing team of managers and co-leads to work with at Google and each day they affirmed the value of the work I brought to the table; work that I was uniquely empowered to do because of my Rice education. The mix of strategy and entrepreneurship courses I took in my first year made navigating the ambiguity of a complex space feel natural. Post-graduation I’ll be joining that amazing team at Google full time. I’m elated that a passionate educator can earn an MBA and use the marriage of those skillsets to one day make an impact in tech. The Rice MBA experience has supported me in connecting the dots between my past and my future, and it’s played such an integral role in my personal and professional transformation.

Have you faced racial judgments in a professional setting? If so, what advice do you have for anyone experiencing something similar?

Of course! People always come to the table with pre-conceived notions of who you are and what you bring to the table. I used to feel pressured to prove to certain groups that I belonged in the spaces that I had access to. I’ve since learned that the proof is in the pudding. If you’re there, it’s because you deserve to be. Knowing that gives you the power to take up space without apology and demand decency from the people you interact with on a daily basis.

What suggestions do you have to work with allies within the workplace or at school?

Align with those who support your convictions but also reserve space for those who will respectfully expand your perspective. The key to allyship is advocacy. Cultivate a community that normalizes speaking up on behalf of one-another. The most challenging and rewarding thing about change, is that it can only be accomplished together.

Based on research by Yan "Anthea" Zhang (Rice Business) and Salim Chahine (American University of Beirut)

Key takeaways:

• Venture capitalists have a huge stake in ensuring the firms they fund are run efficiently.
• VCs also tend to have more IPO experience than your average entrepreneur.
• VCs who can closely monitor a startup may tolerate CEOs with less experience.
• But when a VC firm can’t watch a startup closely, it’s more likely to change unseasoned leadership.

Consider the 21st century’s most storied CEOs: Steve Jobs, Bill Gates, Jeff Bezos. All have one thing in common – not only did they run their companies, they founded them. 

Each of these corporate leaders, in other words, had to deal with venture capital firms to find critical resources for their firm’s success. And it didn’t always end well. Jobs was famously fired when Apple’s board replaced him with the former CEO of a soft drink company – a disaster from which Apple took years to recover. 

Even if changing CEOs doesn’t always work out, however, it often does. And when VCs invest heavily in a company, they are proactive in making their investment pay off. Uber founder Travis Kalanick, for example, who cofounded the ride-sharing app Uber, was pressured to step down in 2017 after the company was rocked by scandals that included reported sexual harassment. 

Though Kalanick’s flameout drew global attention, being swapped out is actually commonplace for CEOs of startups, according to Rice Business Professor Yan “Anthea” Zhang. In a new study coauthored with Salim Chahine of the American University of Beirut, Zhang examined data on 1,156 venture-capital-backed U.S. initial public offerings between 1995 and 2013. Out of this sample, they found that 472 firms, or 40.8 percent, changed CEOs between the first round of venture capital financing and the IPO.

Venture capitalists often have strong reasons for swapping a CEO out, Zhang notes. Guiding a company from its startup phase to the initial public offering requires a huge learning curve. Attention must be paid to human resources, efficiency, public relations – hurdles that can stymie even the most successful startup leaders. Just as in public companies, CEO deficiencies in these areas can harm a company’s IPO success and its stock value after the IPO.

A range of other factors, some subtle, lie behind VC decisions to change startup leadership, the researchers found. Distance between the startup and the venture capital firm’s headquarters is one such factor. If a New York VC firm funds a company in Nevada, monitoring the day-to-day work of the startup is more difficult and costly than if the venture capital firm is based in California.

A CEO directly appointed by a venture capitalist is more likely to be seen as the venture capital firm’s agent, allowing the VC firm to directly control the startup, the researchers write. Overall, VC firms unable to closely monitor the startups they funded were more likely to look for new leadership.

The CEO’s past experience, described by the researchers as “human capital,” is also pivotal. A CEO who has successfully led a prior IPO is much less likely to be replaced than one who hasn’t been through the experience, Zhang’s team found. Similarly, a CEO with finance/accounting experience, an MBA, or a graduate level degree is likely to be seen as more credible than one who lacks such experience or degree. 

Chaotic as it might seem to swap horses midstream, replacing a CEO for one with more experience and education correlates to a better valuation of the public offering, the researchers found. 

These findings are particularly timely now, in the era of COVID-19. As businesses turn to Zoom and other remote techniques, VCs may be questioning more than ever how well they can monitor their investments without frequent site visits and in-person meetings. Building a company has always been a heavy lift. When your funder can only measure your work through a screen, surviving as a startup CEO may be tougher than ever.

Zhang and Chahine (2020). “Change Gears Before Speeding Up: The Roles of Chief Executive Officer Human Capital and Venture Capitalist Monitoring in Chief Executive Officer Change Before Initial Public Offering,” Strategic Management Journal.

Owl Have You Know

Will Robertson ’05, Managing Member of Quintana Infrastructure and Development LLC, talks about investments ranging from energy and natural resources to data and infrastructure industries. Along the way, Will talks about philanthropy and why “if you’re not moving, you’re killing grass.”

Subscribe to Owl Have You Know on Apple Podcasts, Spotify, Youtube or wherever you find your favorite podcasts.

A year ago I was in your shoes — passionate about my career and eager to take the next step in my professional development. Becoming a Rice Business student had been a goal of mine since I moved to Houston, but I hadn’t made the leap to apply. Last year’s Women’s Preview Weekend, a series of women's leadership events, was just the nudge I needed to trust the process and submit my Rice MBA application.

It began with the Women in Leadership Conference (WILC), where I spent an inspiring day hearing from accomplished speakers, participating in meaningful breakout sessions, and networking with fellow attendees. (I enjoyed this experience so much that I joined the WILC Planning Committee to organize this year’s virtual event.)

I went home thinking, “Could this get any better?” and sure enough, day two delivered detailed information sessions regarding the application process and the student experience, faculty and student panels, and tours of both McNair Hall and the Rice campus. Best of all, I got to know other women just like me, with their own stories, experiences, interests, and desire to pursue something more.

Applying to Rice Business was the best decision I made in 2020. I can tell you now as a member of the Class of 2022 that the Women’s Preview Weekend was the turning point for me in realizing that I couldn’t wait another year to apply, join this community and begin making my mark at Rice. If you’re looking for a sign, this is it!

From one future female business leader to another, I encourage you to join us for Women’s Preview Weekend this February. YOU are ready!

Explore the Rice MBA