I was on a jog as I thought about my meetings this coming week. It’s the start of a new academic year and I have close to a dozen calls with first year MBA students on getting into VC from an MBA program. All of these calls revolve around a simple question:
“How do you break into VC?”
I share the same things on each call and finally decided to put it all in writing so anyone can have access to it. These steps worked for me; they may or may not work for you. There’s an element of randomness to VC recruiting. I acknowledge there was a degree of luck for me (I define luck as circumstances that are beyond my control).
My promise: I will be specific and blunt.
Briefly, my bio to provide some context:
· Aerospace engineer at Boeing for 5 years
· Pre-MBA Analyst at a US-China VC fund for 6 months
· Matriculated at Columbia Business School
· MBA Associate at an early-stage industrial tech VC fund for 8 months
· Summer Associate at a $1 billion mobility tech VC fund for 4 months (and counting)
Opinions are my own and not the views of my employer.
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Learn Everything Early
VCs get their pick of the litter so they can expect their hires to hit the ground running with little training. As a result, education and knowing the job is very important. If you’re an MBA student thinking you’ll learn all this at school, you’re mistaken. You learn venture by doing venture. So, I learned all the basics before b-school.
1. Learn corporate finance and financial accounting early.
I have an engineering background so I didn’t know how to read a 10K or value a company. To learn this, I audited a corporate finance and financial accounting class on Udemy (Coursera works too) before I started b-school. This made the first semester core classes much easier and allowed me to focus on recruiting.
2. Learn the basic consulting frameworks early.
Market sizing, competitive landscaping, unit economics, market entry, etc — these are all frameworks you’ll use every time you evaluate a company. I read Victor Cheng’s book, Case Interview Secrets and I did 20+ mock case interviews with my brother (if you don’t find this fun, you may want to reconsider VC).
3. Pick a sector and be an expert in it.
As an aerospace engineer, I had this one covered. Though I didn’t focus solely on aerospace because it’s not a big focus in venture. I branded myself as an industrial technology expert. I read and read and read a lot to be an expert in industrial tech and leveraged my Boeing background. For non-engineers, pick a sector and get reallyyyyy good at it.
4. Learn the language of Venture Capital.
Read Venture Deals, it’s kind of like the bible of venture capital. Once you’re done reading it, get use to talking about venture with classmates equally committed to venture. If you can speak the lingo, you will become a far more compelling of a candidate.
You got the basics down. Time to meet VCs and get considered for an internship. I call this section “smart networking” because there are a lot of ways to waste your time.
1. Easy Points: Networking On-Campus
B-school almost force feeds you networking opportunities. Be smart and filter out the low value stuff. Here are a few specifics that worked for me.
1a. Branding, be the “VC” person
If you say “I’m interested in VC and X and Y”, you’re one of hundreds. But if you’re solely focused on VC, you’re the exception. I was pleasantly surprised when a few of my MBA classmates offered to make introductions to people they knew (yes, I have amazing MBA classmates and I’m sure you do too). These were my first VC meetings.
1b. Ask for intros to founders or VCs
One classmate introduced me to an entrepreneur who introduced me to his friend who works in VC. Another classmate introduced me to a principal and GP and two different funds. I’m still in touch with all four, we share deals with one another, and they’ve introduced me to other people in the ecosystem.
2. Hustling: Networking Off-Campus
MBA programs are great at attracting firms to come recruit on campus. You go to an info session, panel, networking event, coffee chat and you’re one of many MBAs trying to get face time. Becomes a little hard to be memorable. But if you’re the only MBA in the crowd, then maybe you become a bit more interesting.
2a. Demo Days
Being in New York, I went to ERA and Tech Stars demo day. The tickets are either cheap or if they cost a lot, maybe you know someone who can get you in. Then begin the uncomfortable networking. Your first goal is to find interesting startups and founders. Why? You can write an investment memo and show it to a GP. Your second goal is to meet a VC, talk shop, and share a startup or two that may interest them. That’s how you become memorable. Not asking them for a job, but by providing them deal flow.
There is no shortage of entrepreneur meet ups. Go to these to learn about what entrepreneurs are discussing and learn about their startups. Yes, it’s uncomfortable to go to these events alone. I recommend going with a friend but be active in networking with others, not just chilling with your friend.
2c. New Fund Launches
When a new fund launches or a fund raises a fresh round of capital, that’s the best time to reach out because they have money to bring people on. I like Strictly VC and Fortune Term Sheet for my daily shot gun of tech/venture news. In fact, that’s partially how I landed at Alliance Ventures. In January 2018, I read news of their fund launch. I emailed the MD and met with him in February.
***Write 3 Investment Memos***
Very few of you will do this because it takes a lot of work, yet it is probably the most important piece to getting into VC. You want a job in venture, prove that you can do the job by writing a few investment memos. Pick startups that fall within your domain expertise.
If you email a VC looking for a job with a cover letter, again, you’re 1 of many. But if you attach a 2–3 pager of a startup that’s within their investment thesis, well, the conversation becomes a lot more interesting. When you meet with a VC, you can spend the time talking about startups that you like. Trust me, this will impress them far more than simply asking questions about the job.
For notes on how to write an investment memo, I recommend checking out Earnest Sweat’s blog. He’s an investment manager at Prologis VC. In addition to the memo, prepare a 5–8 slide presentation too.
Fly to the Bay Area (I did it 4 times)
This section is specifically for MBAs not in the Bay Area but want to do VC in the Bay Area. You just have to fly out to the Bay Area. Otherwise your chances are slim against the Berkeley Haas and Stanford GSB MBAs. Maybe others were successful without flying out but I flew out 4 times (each trip summarized below). Looking back, two trips would’ve been enough.
· 1st trip in November: Admittedly, this one was a bit of a fail. I was in SF for 3 days and had 3 meetings. It was a little discouraging but such is recruiting. Had to keep at it.
· 2nd trip in January: This was part of a CBS trek I helped organize for 15 classmates. We met 16 funds in 4 days. It was a big success and I made many connections that facilitated my next trip.
· 3rd trip in February: I planned this independently. Through a series of cold emails and warm intros, I got 10 meetings over 3 days. Of those 10 meetings, 8 of them were essentially interviews.
· 4th trip in March: I planned this independently as well. This trip was to decide which Bay Area offer I would take. I still met with 5 funds over 2 days but the primary purpose was to decide between two funds.
I didn’t hedge
At CBS, we call it “parallel path” — an alternate recruiting path to run concurrently with your primary recruiting goal. It’s sage advice considering only 1–2% of MBAs get VC offers. Even people pursuing consulting need to parallel path because a large percentage of consulting applicants don’t get offers (just not enough positions).
I didn’t parallel path. I didn’t hedge. I went all in with VC. As did many others who were successful. But please don’t take this as advice; it’s simply what I did. I promised you I would be specific and blunt. But to be fair, you learn about startups throughout the VC recruiting process. If I didn’t have an internship locked up by April, I might’ve explored startups more seriously.
One piece of career advice for all those seeking guidance from others: If someone takes the time to give you advice, the least you can do is let him/her know what happens in your pursuit.
If you have any question, feel free to ask in the comments section as I’m sure others have the same questions. I may edit parts of this blog as other ideas come to mind. I wish you all the best in the VC recruiting process. It’s very challenging and yes, the odds are highly unfavorable. But it’s also so fun. It’s your job to think about what technology will look like in the future and work with amazing founders’ who are making that future happen.