So this piece of advice is one specifically from the venture capitalists I spoke with and it’s pretty straightforward:
DON’T GO WORK FOR A VENTURE CAPITAL FIRM RIGHT OUT OF SCHOOL.
Sounds kinda harsh – but remember, this isn’t my advice, it’s advice from VCs. Every single GP or MD I spoke with said this- some kindly, others more bluntly, but the same points. The first reason isn’t a philosophical one, but several of the others are:
- There are no entry-level jobs in VC right now. I participated in a three-day “VC Bootcamp” that Darden put on over winter break, where a group of Darden students met with Virginia and D.C. venture capitalists, entrepreneurs, and angels (huge thanks to Cooley Godward for office space and John May and Tim Meyers for setting this up with the EVC Darden Club and the Batten Institute- amazing experience). A lot of VCs talked about trouble with investment exits right now, and how the pipeline they have that is doing well are sucking up their cash, leaving them without money to make a lot of new investments. That’s compounded by the fact that they don’t want to cut loose companies that are doing well, but IPOs aren’t an option and M&A isn’t blowing up either. So they’re not hiring- they’re keeping expenses.
- What have you done so far? If you went and worked for a VC for 5 years out of school, why would I hire you into a top position in a portfolio company? Or a non-entry position in a big company? What have you done and where is your experience? If you’re like most MBAs in school now, you have a smattering of experience that got you into school (yup, that’s my resume), but these first few jobs are going to be very important. So do something with that time- don’t start entry-level at a VC. Go out and work in an industry or function and gain some expertise. The reasoning behind that leads to the next point:
- You won’t work your way up to partner. This is something each and every one of them was very clear about. While sometimes…sometimes….they said that associates or even VPs might have the long shot (after many many years) to become partner after working their way up, it’s more likely the firm will look for someone outside the firm who brings experience or connections they don’t already have. This isn’t a law firm where you follow a set path to partner- if a VC is adding a partner they have to split profit with, they want someone who has experience and connections and brings something new to the table. You can’t build that ‘something new’ working for them. And while you would get some good skills working for a VC, let’s be honest- the really fun stuff isn’t the entry-level stuff.
- Go get punched in the face. No one actually said it in those words, but that’s an expression we used when I was in sales. If you were dreading how tough a day could be, or how bad sales had been, you called up your toughest client first thing in the morning and got punched in the face with their “NO!”. It got your blood up, it made you fighting mad, and you quit being afraid and just went for it. Same thing here- go out there and fail while you can. Learn some lessons, find a mentor, get some expertise.
Those are the four pieces of advice VCs gave when I said I wanted to work in VC. It was a little hard to hear some of them, as working towards a VC job was something I had been thinking a great deal about, but when I started to really listen to what they were saying, it started to make sense. And more importantly, I felt a bit freed from what had become a very focused and constricting job search. I started looking round and realizing how many cool things were on the other side of the fence- the start-up and entrepreneur side, which is how I got to thinking about VC anyway. Perhaps their advice will be as useful to someone else- tomorrow I’ll hit up what the entrepreneurs said!