I joined Lightspeed on February 28, 2006. Since then a few people have asked me how I got a job in Venture. As with most of my career, it was mostly serendipity. However, as a number of others have recently joined other VC firms to do consumer internet investing, there are a couple of themes that can start to be pulled out. I don’t know how useful these are to someone looking to enter Venture, but for what they are worth, they mostly had:
1. Some experience at a startup (not necessarily in a senior role)
2. Some line management experience with P&L responsibility
3. Senior management experience at large internet companies
4. A lot of “outside facing” experience, whether in business development or corporate development or as CEO or GM of a business unit
5. No active, ongoing search for a job in venture capital.
Why are these important?
#1 and #2 are obvious – when working with growing companies, and often first time CEOs, it’s helpful to know what the challenges are and to be able to provide relevant experience and advice to those CEOs. This can make it easier with one part of a VC’s job, to help portfolio companies be more successful.
#3 is also related to the same goal. They have fresh relationships, both within their old company and with peers in the other big internet companies. It’s all well and good to have a board member “introduce” you to the CEO of a big portal or media company by email, but its actually much more effective to get introduced directly to the real decision maker a couple of levels deeper in the organization, and by someone that the decision maker already has a relationship with.
#4 is to do with a separete issue, deal flow. Deal flow is a function of the size of your network, and if you’re in an outward facing job you naturally have a bigger network than if you’re mostly dealing with the same people inside your company every day.
#5 is a bit wierd though. I think it’s less a function of the people and more a function of this time. There has been a flurry of investing in consumer intenet companies over the last 18-24 months, and this has created a bit of a time shortage among the most experienced consumer internet VCs. The guys who have done a lot of this are often already on 8 boards – too many to take on any more investments. Some of the people repurposing themselves from other categories are still coming up to speed. So a lot of venture firms elected to bring someone in from the outside to bolster capacity right away. Other firms are still looking to bring someone on board; I know of at least four top tier firms seeking a Principal or Partner to do consumer internet investing. And the natural place to look is to people at some of the big internet companies.
I wasn’t looking for a new job when I was contacted by a B-school classmate. I think that the same is true of many of the others who have joined recently. But being a Venture Capitalist is a great job, and if you get the chance, you do tend to pay attention. Right now, the window to join the industry is open for people with consumer internet experience, but it may be closed again soon. It’s a career more than a job, and firms are small, so if you turn down an opportunity today, it could be a full 5 year cycle before another opportunity presents itself. So I’m in!
The net of it is to be realistic about your prospects of joining in this cycle. If you fit criteria 1-4 above, you’ve got a shot. Tell people who are connected and that you know well, so that they might suggest you to a firm or headhunter doing a search. But don’t put yourself out there too much – note factor #5. If you don’t fit those criteria, maybe you should think about positioning yourself for the next cycle, and make sure that next time around you will fit the profile of #1-4.