“How do I break into venture capital?”
Besides asking me how my name is pronounced, this is by far the question I receive the most from Elpha members, strangers from social media, or more recently, my fellow MBA classmates.
Not too long ago, I was asking the same question.
I kicked off my career working at the United Nations. But when I found myself wanting to have more direct, on-the-ground impact, I moved into the world of startups.
My first startup experience was launching a sanitation social enterprise in Cameroon. Later, I ran an edtech startup in New York and started fundraising for it. I failed miserably at that attempt, which made me want to really understand the world of fundraising. Eventually, I came across venture capital.
I got my first role in VC at a New York-based tech accelerator and seed VC, where I built a new division and continued to hone my operational skills. Three years later, I applied to the Wharton School – where I am now – to start an MBA. And all of this led me to Moxxie Ventures where I am currently an early-stage investor. 👩🏾💻
Along the way, I’ve learned that there is no one-size-fits-all approach to getting into venture capital. But, there are some steps you can take to stand out in this niche industry:
This guide is neither intended to be a description of what the VC industry is* nor a prescriptive document.
*We assume that readers will have a basic understanding of venture capital as an asset class. If that’s not your case, refer to the additional resources section (below) for a primer.
The reality is that many people want to get into venture capital – there are more candidates than there are jobs! Given the fierce competition, any candidate serious about venture investing will have to find creative ways to stand out, access promising companies, and connect with the right firms based on their individual profiles.
1. Get clear on the type of investing you want to do
Not all VC firms were created equal! They can be generalists or sector-specific, early or late-stage. Some firms will look for operations/platform candidates while others will hire strictly investor roles. You need to understand where you fit. Understand your values, your non-negotiables and explore the firms that fit your criteria.
In my case, I am a Black African immigrant woman. I deeply care about representation and diversity at all levels (beyond race and gender), and I value firms that have those values embedded, not just as a PR stunt.
Early-stage investing vs. Growth-stage/Private Equity investing
Early-stage investing is what I do and what I have always loved doing. Early-stage investors typically write the first check for a company. Sometimes companies are pre-product, pre-launch, or have already gained early traction and are thinking about their first raise.
Since there is limited quantitative data on these types of companies to predict their trajectory and success, most of the assessment is qualitative. The main criteria I use to evaluate deals are:
founding team + experience
market opportunity + competitive landscape (clear winners already present or players equally distributed)
product + technology
Growth-stage and Private Equity investors are more numbers-driven. They invest at a later stage of the business expecting more financial metrics and quantitative information on companies by the time they invest, and their focus is primarily on evaluating companies’ projected financial performance.
Investment vs Platform roles at venture capital firms
Investment: Most people who say they want to break into VC refer to investing roles. Starting out, the role traditionally consists in conducting due diligence pre-investment, analyzing market trends, producing industry reports, and sometimes doing quarterly reporting with portfolio companies for LP reporting.
Platform/Operations: As venture capital firms establish themselves, they seek to add value to their founders. To do that, most have developed a platform, which constitutes a competitive advantage as founders look for value-add investors. Platform encapsulates everything that happens post-investment. It varies from firm to firm and typically covers: putting together an advisory or mentor network for founders, creating content on social/website to showcase portfolio companies’ successes, organizing internal or external events, supporting founders’ needs (hiring, branding, etc).
2. Understand the mind of a venture capitalist
Before diving deep into a venture job search, you must understand how the mind of a venture capitalist works.
Most VCs’ first priority is to return their funds. Put bluntly, if a fund is unsuccessful, the opportunity to raise subsequent capital from Limited Partners (LPs) in order to invest in breakaway companies is slim. As a result, VCs need to be very diligent as they evaluate investments. The same goes for talent. If you are interested in a role at a VC firm, you have to show that you can be an asset to the team, signaling that you will contribute to the success of the fund (ie. return the fund). You’ll need to position yourself as an asset or value-add to a VC firm. Applying the BASE Framework is how you do that.
3. Apply the BASE Framework
Start by developing your BASE: Brand + Assumption + Story + Experience.
Jeff Bezos once famously said “your brand is what other people say about you when you’re not in the room.” What do you want others to remember about you? In what context do you want your name to come up?
When you have answers to these questions, start building your online presence. You can leverage your social media by either posting on Twitter, TikTok, Instagram, or simply interacting with the audience (via comments, retweets, and resharing). This is also a great way to expand your network – with COVID-19, virtual interactions have been more than normalized. You can write blog posts, create a newsletter (Medium or Substack have made writing online a lot easier), or, if you feel ready, nominate yourself to be a guest speaker at smaller gatherings and eventually, big conferences.
VCs are in the business of learning, so the more you express opinions or show expertise on the topics you care about, the better. Have a well-thought rationale on a set of specific topics backed by facts and personal experiences. Don’t be shy about going into those coffee chats, informational interviews, or casual discussions with VCs with bold predictions about the future of your space of interest. The more personality, the better. Think of yourself as a thought-leader in a particular space. Remember, your goal is to stand out!
For example, my assumption has been that I predicted an increase in VC funding in African startups, and while most of those companies are in the fintech / payments space, I have a firm conviction that fintech will serve as a foundation for other industries such as logistics, digital health, or manufacturing.
Know your story! That's your background, where you are from, your values, those key moments that have led you to where and who you are. For example, I was born in Cameroon to a family that really valued education. But, half of my family didn't have access to education so I became really passionate about access to opportunities.
There’s no shortcut to this, especially in the VC world. This industry relies heavily on people skills and connecting with others so have your story polished and ready to be pitched.
Although you might feel like a move into VC is a pivot that puts you back at square one, don’t dismiss your previous experiences – be it as a product manager at a series B startup, a digital marketing executive or an investment banker. Make sure to leverage your past experiences to form your Assumption.
According to Katie Stanton , Founder, and GP at Moxxie Ventures, it is crucial to start acquiring experience as an operator “to really understand how products are built, scaled and sold.” Read more in her Elpha Office Hours .
The BASE Framework will help you to be visible not only to firms but also to founders.
4. Spend 85% of your time talking to founders
As you embark on your job search, you should be spending 85% of your time with founders. Your value proposition to a VC firm depends on how much you know about the ecosystem, including the number of companies you have in your pipeline. Venture firms will care about the type of reach you have.
In the words of Eric Ries, “get out of the building” and start reaching out to firms to offer your help. That can be in the form of an introduction to a potential customer or simply bouncing off ideas.
AngelList, Crunchbase, and F6S are great, easy-to-use platforms to source companies. Twitter and LinkedIn are excellent places to build connections. Elpha has also provided a great place to connect with women founders with traction and budding entrepreneurs.
5. Hone the skills needed to be a successful VC investor
I hear a lot of people say they don’t have the “right” background to work at a VC firm or they don’t have financial experience. I couldn’t disagree more! For anyone interested in early-stage investing, there is no right or wrong background. At this stage, firms value well-rounded individuals with a diversity of experiences who can come in and evaluate deals from their unique perspectives.
For anyone looking for opportunities in later/growth-stage investing, a background in investment banking, private equity, or any experience in corporate finance where technical and financial modeling skills are honed will most certainly help.
However, there are certain soft skills that can help any candidate stand out.
People skills: VC is very relationship-driven. It’s a lot of networking because it’s important to know what deals are happening and where you want to have an allocation (pre-pandemic, I used to attend founders/GPs events at least 3x a week in New York).
Genuine interest in startups and in helping founders: you will be spending all your waking hours talking about and to founders. If you aren’t excited about them, you will probably not enjoy the work.
Energy: While you don’t need to become an Energizer bunny, there is never a dull moment in the life of a VC. You’ll need to understand how to respond and roll with the punches when a deal falls through, or when a portfolio company enters crisis mode. This industry is a marathon, not a sprint (a skill that I personally had to develop over the course of my career)! Success (in this case, a liquidity event) will not happen overnight.
Kindness: Don’t be mean, this is a big, yet small, industry. Founders communicate among themselves so if you build a reputation for yourself, it will be public knowledge.
6. Be an asset by providing value to VCs you want to work with
Once you’ve narrowed down the firms that are interesting to you, determine how you can add value.
Adding value can mean many things. You can start with:
1. Sending deals (this is why you should spend 85% of your time getting to know founders and the remaining 15% matching them with the VCs that are a fit).
2. Sharing articles or content you’ve recently read you think would be interesting to them (especially if they fit into your Assumption and Brand story). Not only does this signal your genuine interest in the firm and enthusiasm for the industry, but it also shows that you are keeping up with the latest trends.
Remember, if you want to be the first in line writing the check for a promising company, you need to be able to imagine the future.
“Many great folks have joined VC firms without prior VC experience. But, they likely have to bring some skills/experience that will be helpful to the VC firm in some way. It's a small industry that doesn't generally make the time or offer the resources to train people. So it's good to think about what a candidate has to offer that will benefit the firm. Is it sector or functional expertise, or relationships, insights, or something else? Firms generally need help with sourcing new opportunities, in doing diligence, and helping founders post-investment - so if you can figure out how to be valuable in one of those ways, that's the best shot.”
We hope this guide helps you get clear on whether a career in VC is for you and how to approach a job hunt in venture capital. ⭐️
A few additional resources:
VC primers for the uninitiated (my personal favorites):