So, you’re a young business professional with dreams of working in venture capital. You’re intrigued by the mysterious and sophisticated world of startup investing. The high stakes, the fast-paced environment, the opportunity to discover the next Uber, or Google — you want in. You consider yourself an intelligent human. You know one way to learn about and break into the industry, is to start with a junior-level position. And work your way up. So getting a job as a Venture Capital Associate is your chosen starting point.
Maybe you’ve already done some research. Perhaps you’ve even identified some funds you want to work at. Only, you don’t know a ton about what VC firms are looking for or much about what a Venture Capital Associate does in general.
And that my friend, is where we come in. By the end of this post, you should have a foundational understanding of:
- The typical job functions of a VC Associate
- What experience VCs may look for when hiring
- How to get noticed by VC firms
Let’s dive in.
Main Job Functions of a Venture Capital Associate
To really understand the position and what it takes to get hired, you need to know what a VC Associate actually does. Makes sense right?
While it depends on the size and experience of the firm, since VC Associates are near the bottom of the totem pole they do the grunt work in two main areas: sourcing new deals and supporting existing deals.
Sourcing New Deals
These folks are on the front lines of finding and screening deals. This could mean anything from cold calling a list of target companies and asking them if they’d be interested in speaking about a potential investment, to attending networking events where entrepreneurs may be in attendance.
Because of the nature of this work, VC Associates are expected to have a sales-like mentality. So if you’re not a big fan of cold calling, cold emailing, or “networking” this may not be your favorite part of the job.
But for those of you who get energy from making new connections, this could be an amazing opportunity to build a top tier network in the startup world, while proving your worth to the VC firm.
As we mentioned, this also depends on the size of the firm. Some firms may not expect Associates to be involved in deal sourcing at all (these are typically larger, more established firms that already have a strong inbound deal flow, and strong relationships in the startup ecosystem).
Supporting Existing Deals
Venture Capital Associates, like many financial analysts, also help support all aspects of a deal, from due diligence to modeling and execution.
With due diligence, they produce the initial analytics that leads a firm to pursue or reject a deal. Sometimes VC associates may also:
- Meet with portfolio company management teams
- Research companies via the Internet as well as private databases like Crunchbase and AngelList (if applicable)
- Perform market sizing and analysis
- Conduct reference phone calls with current and potential customers and partners
- Conduct reference calls with people who have worked closely with the company’s management team in the past and with former employees of the company
- Model expected financial returns based on various investment terms and valuations
This is your opportunity to learn about the nuts and bolts of venture capital finance, and really take a deep dive into the deal-making process.
Depending on the size of the firm however, you may be involved in other things, too. Sometimes VC associates get to support portfolio companies, observe Board meetings, and even contribute to the fundraising process.
What do VC firms Look For in Venture Capital Associates?
Okay, you know what a typical VC Associate does and what their day to day might look like. Now we need to talk about what kind of background a VC firm might look for when looking for their next Associate. But of course, it’s not that simple. It never is in the world of venture capital.
So to answer this, we’ll break Associates down into two categories: pre-MBA, and post MBA.
Pre-MBA VC Associates
These are typically folks under the age of 25, with management consulting, investment banking, or tech company experience. These VC Associates are expected to understand markets and industries, as well as perform analysis to determine market size and opportunity.
What’s also important to mention here is that these are usually non-partner track roles. This means after a few years you might be expected to leave and join a portfolio in an operating role, or attend business school.
Post-MBA VC Associates
At this level, firms are typically looking for someone who worked in one of the above sectors for a few years and then went on to attend business school. Unfortunately, however, pedigree, prestige, and brand name can still matter a lot. So it’s pretty common for VCs to look for candidates from top universities and business schools.
Post-MBA VCs tend to work at a firm for a few years and then hit an inflection point. If they get promoted to principal, it could mean the firm considers them future partner material.
VC firms also tend to focus investments on a specific sector (i.e. biotechnology, telecommunication, consumer products). This means it’s not uncommon for them to pursue candidates with previous industry experience, but no prior finance or venture capital experience.
For example, a venture capital firm focused on healthcare may hire a biochemist that successfully started a pharmaceutical company.
How to Set Yourself up to Get Hired as a Venture Capital Associate
So now we’ve talked about job responsibilities, what VC firms may look for, and the difference between a pre-MBA and post MBA Associate. So if you’re still with us and still interested in a VC firm, let’s talk about some tips and tricks that can increase your chances of landing the actual job.
And for that, we’re going to give you five things you can do to increase your chances of getting hired as a Venture Capital Associate.
Become a sought-after person in a specific domain
Knowing a lot about the space in which one is planning to invest can be a key factor in securing a Venture Capital Associate position. And not only should you understand the space, you should also network within that space as well. So when the time comes, you can tap to find deal flow and open doors for portfolio companies for business development.
Also, do your homework, and go deep on some research on something erudite and technical, then start helping so many entrepreneurs in remarkable ways that a large network of people start introducing you to entrepreneurs starting companies in the domain of your expertise.
Become an online thought leader
On your journey to becoming an expert in a specific domain, write about your musings. This could be on a blog, on Medium or even LinkedIn. Then keep at it until people start to think you might be onto something.
Take notes on every company you meet, summarize them and make sense of them, and write them up in a coherent format. Draft up a brief or report on a space, even better if you do original research, and choose the most promising companies and write an investment memo on them. Document your thinking in compelling ways. Write articles on best practices in company building. Go to conferences and blog about the take-aways.
And when VCs start to contact you about your work, tell them you might be open to working with them.
Focus your job search on firms that have recently raised a new fund
In your typical early-stage fund, the ratio of capital invested per partner is around $50 million. So if you happen to notice that a firm is raising another fund that is $50 million more or greater than their last fund, it could mean they are looking to bring on some more staff.
To find these types of firms, you either go straight to the source (the firm itself), or ask people close to the firm if it’s raising a new fund or has plans in the near future.
Another good resource is newsletters and blogs. PE HUBS Venture Capital Journal is a solid one, and PitchBook’s The Daily Pitch is another good one to find out what firms are doing what, and which ones may be raising a fund.
Talk to All the VCs You Can by Conducting Informational Interviews
You might have heard of the informational interview thing before. Maybe you’ve even conducted one. It’s a popular strategy when trying to break into a company or industry..because it works. Not only is it a great way to pick the brains of current VCs, but it’s an amazing way to network and meet them as well.
Your goal should be to talk to as many VC’s as you can. And when you do, let your passion for the industry come through. Let them know how eager you are to learn more about the space.
The fact is, it’s downright hard to get a job with a VC. It admittedly involves a great deal of luck. And one way to get lucky, is to get in front of as many VCs as you can. You never know when they may decide to hire someone if they think there’s a good fit.
Build a VC Focused Resume
For the folks who don’t have the experience or background that can clearly be mapped to the job functions of a VC Associate, I’m mainly talking to you. If this is you, you need to work hard to add those experiences to your repertoire and build a more VC-focused resume.
You could do things like:
- Get a part-time job, or volunteer with a startup (if your schedule allows it of course)
- Learn to code and use those skills to build a mobile app or website
- Start a meetup group related to tech, or startups.
There you have it. Do these things and you greatly increase your likelihood of getting hired at a VC firm. But don’t be fooled, it might take some time, require a bit of a strategy, and happen through serendipity. Be prepared to play the long game here.
It can happen. The key is to get started.
One Last Piece of Advice
We’ll end with this. If you really want to get hired as a Venture Capital Associate, figure out what firm you want to join and then go act like an Associate connecting and by bringing VCs deals that fit within their theses.
You must prove you can bring outstanding value to the role, and to the firm.
Do this, and you’ll make a pretty darn good Venture Capital Associate.