Someone Asked for Advice About Getting Into VC. What’s Missing? Did I Hit the Right Notes?

Kanyi Maqubela, a Partner at Collaborative Fund, tweeted a photo of an email he was working that offers his perspective of how to become a VC.

As you can see, it’s a bit small, so I figured I’d write it out in a blog post. I haven’t changed any words or formatting. These are Kanyi’s views and insights, not mine. If you like his thoughts, reach out to him on Twitter.

From Kanyi Maqubela:

OK, how to become a VC. Please forgive the stream of consciousness here; figure this is the most efficient way to communicate the concepts / POV here.

1. junior VC is only sometimes a pipeline to a career in VC. Some firms promote, most don’t
2. junior VC is usually deal-sourcing and sometimes diligence, while GP (general partner) is picking, board directing, and fundraising
3. LPs hate first-time GPs, so you’ll probably want to join a fund if you want to get investing experience
4. angel investors with multiple 100M+ exits get hired by funds as GPs
5. highly successful entrepreneurs (100M+ exit) get hired by funds as GPs
6. very well-connected senior executives at growth startups get hired by funds as GPs (sometimes)
7. only thing harder than joining a firm is leaving one, so GPs are very selective about adding to their partnerships
8. if you want to be an angel investor, invest the amount of money you’d be comfortable lighting on fire
9. no set path to VC. the GOAT investors have been journalist, career VC, entrepreneur, athlete, banker, lawyer before
10. prepare for long feedback loops
11. most of your time will be spent helping companies that aren’t working die gracefully or saying not to ideas you don’t really like
12. leas meritocratic industry ever. a firm’s success is driven by its prior success. intense network and bandwagon effects
13. some of it is about taste, some of it is about intellect, but a surprising amount is about who you know
14. a GP, however, is only as good as their last great deal. vast majority of GPs haven’t seen a carry check
15. you’ll be taxed on gains before you earn them, so make sure you’ve got some money leftover. GPs invest (a lot!!!) in their funds, too.
16. takes a long time to build a great reputation. takes a short time to spoilt it. protect it.
17. takes about 6–7 years to know if you’re any good at it (that is, if you have created the right conditions for luck)
18. every relationship becomes transactional. everyone you know either wants investment, or knows someone who does
19. when you’re first raising, *nobody* wants to invest. when you have momentum, *everyone* does.
20. lots of internal inconsistencies. you have to be very high conviction about companies you know are going out of business.
21. success tends to accrue to those investors with strong points of view. just have to be more right than wrong.
22. feel the power law in your bones to understand the odd entropic nature of VC.
23. if you have demonstrated an element of resource magnetism, that can make you a good candidate for VC.

Now that you’ve read all of those gems of advice, make sure to share your thoughts with Kanyi on Twitter. Do you agree? Did he miss anything?

Thanks for reading and please recommend this post so others in your network can learn from these lessons of getting into the venture industry.