I get this question a lot. Usually it comes in the form of “do I need [x] experience to get into VC?
The answer is an unequivocal “no.” If you don’t believe me, do look at the backgrounds of VCs across several firms. You’ll see they are quite varied. There are former journalists and lawyers. My firm includes a number of former floor options traders. So there are no prerequisite experience to break into the industry. This does not mean, however, that there aren’t some backgrounds that are more prevalent. Former entrepreneurs, engineers, and executives are very common. Perhaps those backgrounds may be more in demand, but the point is that the lack of one of these backgrounds does not count you out.
I do think that getting an MBA is a prerequisite for most venture firms. It may also be that MBAs are correlated with people with more years of experience, which VC firms admire. The exceptions I have seen are people who enter the industry as entrepreneurs and those who are in the top echelon of investors/raw intelligence like Jeremy Levine and Brian O’Malley.
There is a distinct reason for why backgrounds are so varied. That’s because the demands of the work are varied. One day you might be working through a marketing issue with a company and the next moment you are negotiating with a difficult acquirer. It’s also important for a venture firm to be able to relate and empathize with a wide variety of entrepreneurs. That requires different backgrounds, personalities and dispositions. At OCA we are well equipped with an ultra-optimist, a pessimist, a skeptic and an optimist among others. I believe it helps us make better decisions and also allows us to rotate the right person in for the right situation.
One recommendation I give aspiring VCs is that they have to look carefully at (a) the backgrounds of the investment professionals at a fund and (b) the fund’s strategy. Figure out how your skills and experience can help make the capabilities of the team more diverse and relevant to the fund’s strategy. Perhaps you have deep operating experience in an industry that the fund is investing in, but the team has less of that. Perhaps a fund is looking to appeal to a set of entrepreneurs that are just like you but that they don’t have anyone who mirrors that profile in the fund. For people who have a wide set of experiences, there are a lot of angles to emphasize. For those with less varied experience, that too
may be an advantage but may require that you focus on a smaller subset of target firms who clearly value the depth of that skill.
This means that recruiting for a VC job is not a normal process. It’s not like consulting or marketing or banking where the way you pitch yourself tends to be similar from firm to firm. This is a highly customized argument to each firm. It requires research and understanding each firm individually. It’s time consuming. Perhaps the one upside to being so few firms in the industry…