Breaking Into Venture Capital

Venture Capital is a huge proponent of innovation in the world. The monetary backing of new businesses leads to new ideas, products, and solutions that forever change the world we live in. If you’re thinking about starting a career in venture capital, this is the page for you.

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What Skills You Should Have

Qualitative Skills

  • A founder or investor network → participating in meetups & local tech events
  • Sourcing and on call experience with founders → joining fellowship programs such as Dorm Room Fund, GenZScouts and more
  • Writing Skills → practice writing investment memos from companies you meet
  • A great brand (more to this here) → build up your brand through twitter, launch a podcast, write about startups and more

Quantitive Skills

  • Basic financial literacy → Reading financial statements & basic modeling experience
  • Understanding key terms in the venture space and metrics → CAC, LTV, Run Rate etc

Experiences/School Backgrounds

  • 50% of all VCs have either gotten their degrees from Harvard or Stanford
  • Early Stage VCs love either former founder or operator experience
  • PE/IB employees have historically been great fits at late stage funds
  • A select few VCs that also have been hired for their community building skills or vast networks

Where Should You Work?

Early stage or late stage, emerging fund or established fund. The all you need to know to choose the right fund for you.

Early Stage Fund: Early stage venture funds typically focus on companies that are in the early stages of their development, such as pre-seed and seed stage startups. Early stage venture funds typically invest smaller amounts of capital than later stage venture funds, and they often focus on businesses that are in industries with high growth potential. Early stage funds invest in companies based on their business model and their team, rather than their financials. The best skills to have as an early stage VC is having a great network, operating experience and being able to help founders scale. Many early stage VC profiles come from product, founder, operating and accelerator backgrounds. Well known early stage VC funds include A16z, Sequoia, and First Round Capital.

Late Stage Fund: Late stage venture funds generally focus on companies that are further along in their development, such as those that are in the growth or expansion stage. Late stage venture funds typically invest larger amounts of capital than early stage venture funds, and they often focus on companies that are in industries with more mature growth potential. Late stage funds analyze companies based on financials, revenue and traction. Much of the talent pipeline comes from Investment Banking and Private Equity as the skills needed is financial modeling heavy. Well known late stage VC funds include Tiger Global, IVP & Insight Partners.

Emerging Funds: If you are interested in working at a small fund and being able to see the full picture of what running a fund is like, then you may want to consider an emerging venture fund. These funds can offer a wide approach in what you can do (Fundraising, Sourcing, Due Diligence, Fund Ops) and you may have the opportunity to help shape the direction of the fund. However, these types of funds can also be more risky as many emerging funds lack the traction or institution capital more established ones have.

Established Funds: For those wanting to be at a more hierarchical organization that has name brand recognition, established partners and more, then an established fund may be a better option for you. These funds tend to have a longer track record of multiple funds and have institutional capital backing them. However, you will tend to focus on one side of the picture and less involved in fund operations or working with LPs.

Finding a Job/Internship in Venture

Top Venture Capital Job Boards

Mainly for students and recent grads who want to learn more about the industry before an internship or full time role, venture scouting &/or fellowship opportunities are a great way to them to initially break in, learn more about the space, and meet like minded people with the same goals as them.

In venture fellowships, fellows will learn the basics of venture capital & have opportunities to scout. Examples of things they learn include:

  • How startups are built
  • How to evaluate startups
  • How to work with startups
  • How to develop and execute on an investment thesis
  • How to source and lead investments
  • How to work with entrepreneurs post-investment
Dorm Room Fund
Rough Draft Ventures
Harlem Capital
Lightspeed Scouts
Ripple Ventures
Ground Up Ventures
Pear Fellows
List of More VC Fellowships

How to Ace the Interview

  • Most VC firms have more than one round of interviews: both for internship + full time roles
  • Most do a 30 minute phone call with an analyst/associate to gauge applicant
  • If things go well, move on to interviews with the principal/ partners
  • If you ace that, you’ll get an offer

Common Interview Questions

  • A list of the most common questions they ask
    • Why Venture Capital?
    • Tell me about your experiences and how they pertain to VC?
    • What is your favorite sector and what is some interesting things happening in that space?
    • What is a company that is in our portfolio that you like and why?
    • What is a company that is not in our portfolio but should be?
    • What makes you suited for this role?
    • Q’s on what are SAFEs and how to calculate post-money valuation

How to Answer Interview Questions

  • Why Venture Capital?
    • Talk about your passions for the industry and why startups in general
    • DO NOT Say you’re in VC because it’s easier than IB or for the money
  • What is your favorite sector and what is some interesting things happening in that space?
    • Research beforehand on some articles in spaces you are interested in and be able to talk on it
  • What is a company that is in our portfolio that you like and why?
    • Research a VC firm’s portfolio and pick 1-2 companies you really like and be able to answer why
  • What is a company that is not in our portfolio but should be?
    • Be able to speak to 1-2 companies that fits the VC firm’s thesis and be able to talk about why they should invest
  • What makes you suited for this role?
    • Build up your network of investors + founders to stand out