Careers

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Venture Capital uppers

1. You often get to be the one making decisions because you have money. .

2. Over the long term, you will certainly become rich because the job is well paying and you should eventually get "carry" or equity in the firm. .

3. Being "in the middle of it all" in some of the most interesting industries. .

4. You have access to the best minds -the people you work with are typically very smart and interesting.

5. Your job is to absorb and enjoy the positive creative energy of entrepreneurs and direct it toward successful execution. .

6. You could suddenly become rich if one of your companies does extremely well and you were able to co-invest or you have carry. .

7. You have access to the best information systems.

Venture Capital downers

Here is a list of some of the negatives we hear from people who have worked in the industry for a while.

1. You don't have pride of ownership in anything. You're just an investor, not a builder.

2. VC is a slow path to wealth compared with the immediate cash income you get in investment banking, hedge funds or even management consulting. .

3. You are a jack-of-all-trades, not an expert. After a few years, you can't do anything other than VC because you grow spoiled by making decisions without much compromise. .

4. Venture capital is fundamentally a negative process. Because you reject 99 of every 100 plans, year after year, over time you focus on figuring out what is wrong with a company so you can reject it and get onto the next deal. What is wrong with the management? The technology? The deal terms? The strategy? After just a few years, that mentality may bleed into your life. What is wrong with my partners? What is wrong with my spouse? What is wrong with me? Oh, the angst! .

5. Because you reject 99 of every 100 entrepreneurs, you make a lot of enemies, no matter how nice and helpful you try to be. No one likes rejection, and passionate entrepreneurs have long memories

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How do I get an Interview in VC?

VC firms are inundated with requests for interviews and informational interviews. The time of venture capitalists is precious. If a VC firm lets it be known they have a single summer internship available, they can expect 300 resumes from people at the top 10 business schools. Now that you're more aware of what you are up against, here's a glint of hope -- as a whole, venture capital firms are always hiring.

So what can you do? Network. Ultimately, networking and schmoozing is the key to a job search in every industry, but it is even more so in the VC industry. Building contacts in the industry is key to finding out about jobs and getting an interview. It helps to have a strong recommendation from someone the VC respects.

The other way to get an interview is to have deep industry experience. This takes a few years, so it's not for the impatient.

Another way to up your chances at an interview -- do your research. Target a niche attractive to VC firms. Read the trade press or go to a large trade show and catch up on the buzz.

By far the best way to approach a venture capital firm is via a simple introduction to one of the professionals. "Johnny Trustworthy suggested I contact you about", will make a big difference. Part of your job should be finding people who are in a position to make this introduction. All VCs work with lots of lawyers, bankers, portfolio companies, and boards of directors. Poll your network to see who might know at the right people at these outfits as well as the VC firms themselves.

Then get access to VentureOne (a Reuters product) or VentureXpert (a Thomson Financial product). These databases are very expensive, but you should be able to get access at a local business school or at a friend's investment bank or venture capital firm.

VentureOne and VentureXpert chronicle investments reported by venture capital firms across the U.S. They give you the name of the company invested, which VC firms made the investment, how much was invested, and a short description of what the company does. By studying the information, you may glean an indication of what are currently considered hot investments. You might also start to see patterns where certain names of firms are repeatedly attached to companies that interest you. This info will help you focus your list of preferred venture capital firms.

Then hit the Web to find out about each of the companies in that space, the VCs that invested in them, and the opinions of journalists who write about the niche. Develop your own ideas about the market and find other private companies that haven't yet attracted investors. Trade shows are among the best way to research companies. Once you have developed ideas backed up by research, you can approach and impress a VC.

Kauffman Fellowship

Another way to get a post-MBA job in VC is the Kauffman Fellowship ( http://www.kauffmanfellows.org/ ). The $1 billion Kauffman Foundation was created by Ewing Marion Kauffman in 1992 to support youth development programs and to accelerate entrepreneurship in America. The fellowship is one of the foundation's innovative programs. Its mission is to increase the number of well-trained venture capitalists in the U.S. by placing and paying for top candidates to work as associates in prestigious venture capital firms. It is an excellent program, and has been responsible for a significant percentage of the next generation of venture capitalists over the last few years. Kauffman fellows now represent their own alumni group within the VC industry and use that network to help other alums.

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The VC Career Path

Analyst/Associate -- entry level

If you are coming out of college and have little experience in the working world, this is your starting spot in the world of VC. This position is called associate or sometimes analyst, depending on the firm. Be aware that many firms do not hire straight out of undergrad (because hands-on experience is such an important component to the business). Display some entrepreneurial activity in your background and some type-A, oddball experience --a pilot's license, racing a sailboat to Bermuda, running an investment club of students, starting a boxer shorts company, and so forth. Most importantly, you need to be fun, confident, quantitatively skilled and willing to work hard.

Associate/Senior Associate/Principal/V.P. -- partner track

If you have industry experience (e.g., telecommunications, medical devices, consumer products) and/or have your MBA, this is the position you're shooting for. This position is often considered "partner track." An MBA is almost always a prerequisite. The most important attribute is to show good judgment and impeccable schmoozing talents.

Junior Partner/General Partner

This position enables you to make investment decisions. It is only conferred on those who have very deep industry experience or those who have shown they can make such decisions at another firm. The good news is it is not uncommon for serial entrepreneurs and successful industry players to move directly into these positions. Venture capital is a business often entered into later in one's career. A good set of golf clubs is a prerequisite.

Managing Partner

Raise your own fund and start a venture capital firm! Figure out your probability of success before you start spending hundreds of hours banging on doors. Look at the numbers. There aren't many positions available, and the ones that exist are hard to find. Why?

• __The venture capital industry is small. It is made up of only several hundred small firms (each consisting of between two and 40 people). __ People rarely leave venture capital once they're in. It's too much fun spending money on the latest ideas, working with highly motivated and intelligent people and the latest ideas, and making lots of money. It's also hard for a venture capitalist to transfer into more regimented careers.

• The old boys network is in full force in this corner of the economy. The portion of partners with degrees from Harvard and Stanford is very high.

• The demand for positions is so great that the openings are often filled through networking and not publicly advertised.

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