I’ve been talking recently to a number of people interested in pursuing a career in VC. It’s really difficult to offer any good advice as to the best way to become a VC because there are a number of different paths to choose from. VCs can come from investment banking, management consulting, start-ups, big corporations, etc. There is no “typical” career track to follow to break into VC.
With a very limited number of openings each year and many qualified applicants, VC firms can be very picky in their hiring; most VCs working in life sciences have either an M.D. or Ph.D., and several have an M.B.A. in addition to the other degrees. As the VC industry contracts (see figure below, source: WSJ), there will be even fewer positions available.
While there’s no guarantee of landing a job, I believe the Kauffman Fellows Program is a good way to get your foot in the door. Search firms, such as Glocap, Pinnacle Group, and Polachi, might also be helpful.
I’d like clarify a misconception that some people might have about being a VC. I absolutely love my job, and I’m very fortunate to work with very smart, stimulating people. It’s a lot of fun meeting entrepreneurs with really interesting ideas about solving the world’s problems. There is no such thing as a perfect job though, as every job has its pros and cons, and being a VC is no different. Let me know if there are any jobs out there that will pay you to sleep with models (j/k). While it may appear that being a VC can be somewhat glamorous and lucrative, it is definitely not always the case; especially if you’re not a partner. I rent a one-bedroom apartment and lease my car. I have about $35K remaining of almost $100K in student loans to pay off. I am by no means poor, but my life is not very extravagant either. I believe most VCs who aren’t partners live relatively modest lifestyles.
Even if you overcome the odds and land a position, the probability of becoming a partner is relatively low. With fewer firms remaining, there are even fewer partner positions available. Ultimately, “you eat what you kill” in this business, and if my investment decisions result in poor returns, I won’t survive in this business for too long.
Check out John Gannon’s VC Career Resource page for more information.