Student Venture Capital Programs

By Niraj Pant

An increasing number of venture capital firms are going past their traditional avenues for finding companies and looking at a new source: students. Specifically, they’re hiring students to work part-time on sourcing companies that they find interesting.

Many tech investors are struck by FOMO, and are starting to become more aware that young adults are among the first to adopt new popular apps and create/identify new social media trends. No one wants to miss out on the next Facebook or Snapchat (both of which were started on college campuses!). Therefore, investors are putting more confidence into students as scouts for their VC program. While venture capital scouts aren’t a new concept (Sequoia Capital is famous for hiring scouts to invest in companies on their behalf), many new opportunities are being opened up for college students to get involved in venture capital.

Participants in these programs don’t usually get carry, but are often incentivized by compensation and/or networking opportunities with some of the smartest students in tech, as well as partners at their respective firms.

Rough Draft Ventures (RDV) and Dorm Room Fund (DRF) are some of the earliest venture capital firms focused on students investing in companies. Student partners are organized by chapters in Boston (RDV & DRF), Philadelphia, San Francisco, and New York (DRF), and have real input in funding decisions. These funds are usually backed by larger funds (First Round Capital for DRF and General Catalyst for RDV), and receive mentorship/resources from their parent VC firm, as well as deal flow that they find interesting. They often invest in companies that are founded on campus or have student/recent graduate founders.

The results from past investments have looked extremely strong, considering the limited time these firms have been around. Students seem to be picking the right companies to invest in, shown by the $100m+ dollars in follow-on capital raised by portfolio companies from large venture firms such as Google Ventures, Union Square Ventures, and Spark Capital.

Smaller firms, such as Alsop-Louie Partners, have also been hiring student partners for the past few years. However, instead of having a separate student-focused fund, they hire campus associates to help them stay connected to new ideas on campus and bring in interesting companies. StrictlyVC had a great interview with Stewart Alsop about the program.

Larger VC firms, such as Sequoia and KPCB, have seen the value in bringing on students, and recently created student ambassador programs. These programs are run year-by-year until the campus ambassador at a school graduates, who is then replaced with a new ambassador on each campus.

Here’s a list of venture capital firms with student programs I’ve come across (shoot me a message on twitter if there are any missing!):

• Sequoia: Campus Ambassadors Program
• KPCB: Campus Catalysts
• Greylock X
• Binary Capital: External Council*
• The Mochary Group
• Pejman Mar Ventures
• Chicago Ventures
• Lightbank
• Alsop-Louie Partners
• Accel Partners
• Lowercase Capital

Student-focused funds

The following funds are primarily student-focused, rather than a program at a larger firm.

• Free Ventures: Although not a traditional VC firm, Free Ventures is an accelerator for student startups, and very similar to an early Y Combinator.
• The House Fund: Run by a UC Berkeley alum, The House Fund is a $6m seed-stage fund focused on investing into companies with student founders. They will invest angel-sized checks, and syndicate the rest of the deal.
• Contrary Capital: A university-focused fund, with student partners at every major school.
• A-Level Capital: Student-run fund at Johns Hopkins University. Students work in a variety of roles, from associates all the way up to partners, and usually invest in companies created on campus.
• Dorm Room Fund: Described above
• Rough Draft Ventures: Described above

Venture capital role placement

These types of programs not only help with learning more about venture capital, but often help place students into exciting startups, large tech companies, and venture roles.

Dorm Room Fund recently published a list of their student partners from the last graduating class and where they were headed full-time. While most startups when to working at startups or large companies in a variety of roles, about 20% of partners went into venture roles, a relatively high number considering most analyst/associate roles at VC firms are unadvertised.

Written by Niraj Pant (email). Thanks to Jay Bensal, Ali Afridi, and Wiley Jones for assisting in developing early iterations of this piece. Ali Afridi wrote a complementary post on how to get involved with VC while still in college. *Disclosure I work on Binary Capital’s External Council.

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