How to get a job in Venture Capital
Ever since started I working in VC, I often get messages from people that want to break into the industry. Usually, they are something like: "can I buy you coffee to pick your brain on VC? I think I would be a great investor". This is probably the weakest way to pitch an existing investor.
I absolutely love my job and have found my calling in life; if you are trying to decide if VC could be a fit for you, read on.
Venture Capital = Selling Money To the Best and Brightest
The first thing to understand about VC is that it is a sales profession. In my day to day, I find myself selling three things: fund returns to Limited Partners, value to founders (access to money, talent, business development), and career opportunities to potential recruits.
If you don’t have experience in sales, BD or recruiting, an engineering background can also be extremely useful if you want to break into VC.
However, there are no prerequisites to becoming a VC except for resourcefulness. Strive to cultivate a "Gary Vaynerchuk type of hustle". You can start by building something that adds more value than you can capture. Examples: i) a newsletter ii )a Slack group that has a proprietary component iii) Python a crawler for sourcing deals.
Next Steps: First Impressions Count
Being a good Venture Capital investor requires you to have access to capital. You must also see as many opportunities as possible and rapidly make the right the decisions on who to partner with. If you can do these 3 things well, you will succeed.
Anyone can become a VC. Your previous job has little importance since Venture Capital follows an apprenticeship model. The most precious asset in the industry is your ability to be resourceful with velocity.
You only have one chance to make a first impression. VC is a reputation-driven business. Which means every detail ahead of an interview or potential interaction counts. Your emails, your ability to add value to the person on the other side and, most importantly, what is unique and authentic about yourself.
Prove that you can do it before someone asks you
The beautiful part of getting a job in VC is that it's uber-competitive to get in, but there is nothing that disbars one from doing parts of the day-to-day of a VC, even if you don't have a fund or a job in the field.
If you want a job in Venture, you should be regularly sending deals to MDs at the funds you aspire to work with. Taylor deal-flow their way.
Before my first VC interview for an associate position, I talked to over 40 CEOs and presented 2 fully written memos for the partnership. One company ended up being funded by LightSpeed Venture Partners, the other was funded by FundersClub, the firm I ended up working for prior to starting ONEVC.
I was disappointed with HBS and GSB students that would approach me and wanted to grab coffee immediately to chat about Venture. Nobody has time for that. Steve Blank has a helpful post on how to get meetings with people busier than you. You should follow his recommendation.
Do the work before someone asks you to. Surprise and enlight.
3 — Diligence Goes Both Ways
Breaking into the industry is very hard. Since there won't be a lot of chances, It's important that you reflect on the type of fund you want to be a part of. Cultural fit should be a compulsory item on your search for what fund to join.
I called every former employee of FundersClub and hunted founders that did not have a good experience with them to make sure I was ok with their issues. Nobody is perfect in life.
4 — Founder Empathy
At the early stage is this is probably your best currency as an investor. The best CEOs will always have funding resources to take them to the next level. All the best deals I have, the founders picked me, not the opposite. You want to be the first phone call for when something good and when something bad happens. Empathy is an important currency.
5 — Get people to vouch for you, before and after your interview
The best possible recommendation you can get are from existing portfolio companies, the second best type is from people that the fund you are applying for has turned down in the past. Additionally, other employees of the company/fund can also help. Get them all. Have them send their emails to the GP or hiring manager right after the in-person interviews. Timing on references is crucial. You want them to come in before the manager goes out to request them.
6 — Optimize for access not compensation in the early days
During my first job in VC, I got to source and close deals with more freedom than traditional firms. I recall asking a friend of mine that works in one of the most reputable firms in the business:
me: how do you make partner at firm x?
friend: probably when someone else dies, quits or if we raise a much larger fund
me: (gasp)
I've heard from others that if you want to get rich fast, become a founder. Venture is the "get rich slow" path and I tend to agree. Once you are in and have proven results, the next step is to have access to carry.
As we build our team at ONEVC, anyone we hire will be on a path towards becoming a partner. Otherwise, the entire endeavor is pointless.
7 — Venture is about service and humility
Founders are probably some of the most demanding types of clients that you will ever have. The best ones are all in their business and you should always be available to serve them. Being in Venture can easily consume most of your life. Every weekend I'll have 2–3 calls that are related with work. I love it, so it's not a problem. But I think it will only work for you if you are truly passionate about making a difference for founders. We are in the service business.
8 — Have mentors help you get the job along the way
I would not have gotten this job without the help of some incredible mentors that were supportive both from the tactical and spiritual level. They shared with me the difficulties of the profession and provided me on-point advice on next steps and even helped me with my email responses to the FundersClub team. Some of them were kind enough to provide me with a positive recommendation.
Special thanks to:
Mike Hennessey, Ben Hadley, Anderson Thees, Lee Jacobs, Ty Walrod, Elton Miranda, Gabriel Senra and Ethan Appleby for your help and support.
Additional excellent readings on How to Get a Job in Venture Capital:
Why Being a VC Sucks by Charlie O’Donnell, from BBV
Want to work in VC, here is how by Mark Suster from Upfront Ventures
