Breaking into Venture Capital — How to get a job in VC

After 3 years at Flipkart and a failed stint at entrepreneurship, I wanted to try Venture Capital.

Venture Capital is a very closed and sought-after industry, Most people told me that I may not be able to get in.

Breaking into VC was hard — I applied to a lot of funds, got rejected by most, and ended up closing two offers.

Here is a primer on how to break into VC ??

1. Understand the basics of Venture Capital & Venture Investing

• Familiarize yourself with the venture capital (VC) asset class, limited partners (LPs), the VC fund cycle, the history of venture capital, the Power Law, and the distinctions between venture capital and private equity (PE)
• Explore risk and return across different asset classes and the economics of a VC fund
• Read books such as Venture Deals, Power Law, Secrets of Sand Hill Road and more

2. Understand the Structure of a VC Fund

LPs -> GPs -> Principals -> Associates -> Analysts

(For the Investment Team)

There may also be roles in platform services, marketing, and Entrepreneur-in-Residence (EIR), although these positions are less common.

With 2–4 years of experience, you are likely to target roles such as Analyst, Associate, Platform, and Marketing.

3. The VC Analyst/Associate Role

A VC analyst typically -

• Scouts founders and sources companies to build a pipeline
• Networks and interacts daily with new founders, maintaining a comprehensive database
• Contributes to the development of sector/domain theses
• Analyzes deals and prepares investment memos.
• Assists principals and partners in conducting due diligence.
• Supports partners with miscellaneous tasks.
• Attends networking events

Skills required

• great communication skills
• pro networking skills
• should be able to write with a great articulation
• understand and make sense out of data
• ability to take on ambiguous problems
• think with breadth and depth (depends on the kind of the fund)

4. Types of VC Funds

VC funds can be sector-specific (SaaS, Deep Tech, Consumer, Impact etc), stage-specific (early stage, growth stage etc) or generally a function of both

Bigger funds generally invest across domains and stages and often have different teams for the same.

5. Tier 1 VC Funds vs Others

Based on their reputation and history, certain funds are often thought of as Tier-1 VC funds.

These funds generally hire for specific roles and pay better whereas smaller funds may offer broader exposure owing to small team sizes.

Your VC experience will be very different based on the size and culture of the fund.

6. Fund Hiring Patterns

Every VC fund has a set process which works for them. Based on that, they may hire with great specificity.

For instance, a few funds prefer candidates from top tier engineering colleges or commerce colleges with a consulting background, because it works for them. Some funds may not have set profiles that they look for.

Best to check a fund’s People Page to assess whether your profile fits their ideal profile or not.

7. Your Motivation to Join VC

By now, you should have a clearer understanding of the industry.

This is a good time to reflect on your motivation for wanting to join VC

Many people are drawn to VC for the wrong reasons and consequently fail to succeed.

For instance — If your goal is to start your own company, pursuing a career in VC might not be the most effective stepping stone; however, working at an early-stage startup can be highly beneficial.

Most VC Analyst/Associate programs expect you to either pursue an MBA or join a portfolio company after a few years. While this may not apply to smaller funds, having clear future plans and a strong motivation for entering VC can be very advantageous.

8. Figuring out your Niche

Based on all the research, you should be able to figure out a few funds where you may have a shot. This will really help you with the next steps, randomly applying everywhere may not yield results

9. Before Applying for Jobs

• Understand the asset class well enough
• Find your sectors of interest or sector/stages where you can add the most value at
• Read a lot of Investment theses and try to write one on a sector/company of your choice
• Read blogs & reports from various funds and partners
• Chart out the VC landscape in your sectors and/or geography of interest
• Start building a network in the ecosystem

10. VC Job Postings

VC suffers from a disproportionately high demand-supply mismatch because of which not all the openings may be available in public or Linkedin

• Keep a check on their fund twitter handle as well as that of the Partners
• Keep a check on their website
• a very few openings maybe present on Linkedin as well
• Job boards such as workin.vc
• Newsletters such as Shoulder of Giants by @AkulJindal2
• @nic_detommaso does a weekly thread on VC openings across the globe
• VCs often hire from their network, best to find out ways to break into that network (founders, fellow Analysts & Associates, Expeirenced Operators etc)

11. How to Land an Interview

A warm intro from a founder or someone within their network works the best but you can also apply via openings on Twitter, applying via application forms and cold emails/dms.

12. Preparing for an Interview

Different funds have different processes, but they will try to evaluate you on the core skills required for the job and whether you culturally fit into the fund or not.

• Research the fund’s history and investing style
• Research the fund’s portfolio (Companies that you like, dislike, or potential investments for the fund)
• Prepare deep dives into a couple of sectors
• Write a sector thesis
• Write an investment thesis
• Speak to existing team members, if the fund is big enough
• Prepare behavioural questions
• Get the Why do you want to do VC right

Good luck breaking into VC, I wish you all the luck!