Venture Capital Hiring is Broken and Unlikely to Change. What Do You Do if You Want to Break in?
When we set out to bring on new team members this fall, we had the best of ambitions around running a merit-first, unbiased process. We’ve experienced firsthand the lack of diversity in the industry and read plenty on the unconscious bias in hiring. Given the existing diversity of our team and our desire to add unrepresented voices to the table, this felt like the only way to go about the process.
So, we went to it. We established practices that kept this in mind and we started patting ourselves on the back for doing it “the right way.” We would look at written answers before ever viewing a resume or seeing what someone looked like. We had multiple team members review each profile to ensure we weren’t missing anything important. And the good news is that we ended up hiring not one or two, but three people for our investment team. We feel good about the diversity of the candidates and we feel great about the people we hired.
That’s the good news. The bad news is that the process was exhausting and, yes, despite concerted efforts, still flawed.
We ended up receiving almost 400 applicants, and these hiring procedures knocked me off my high horse. We spent dozens of hours reviewing candidates’ videos, resumes and case studies. Even with this, we likely missed out on going deeper with a few stars. We’re positive we ended up making assumptions about applicants, and we already know ways in which we want to improve the process the next time around. Even then, the process will likely be flawed yet again. We will miss the boat on potentially fantastic candidates.
While the industry is making concerted efforts to change its “old boys’ club” ways, I worry that many of the gripes I had almost twenty years ago when I was trying to land a job remain today and are here to stay.
Why is this exactly? Well, venture capital is a business about finding outliers; we investors are wired this way. Outside of the rare firms playing the volume game, most of us want to find outliers when we invest in founders and we want to find outliers when we hire on our teams—even at the most junior ranks. Finding one person who thinks differently is far superior to a homogenous environment. Our job is all about finding that one special company versus several that are moderately interesting, and that mentality translates to our hiring procedures.
This is different from process-driven cultures, like investment banking or consulting, which operate as larger machines and have the recruiting infrastructure to, year after year, find a new crop of recruits. If you are above a certain bar, you will almost certainly find a job in those fields. That’s not the case with venture. Because firms rarely have teams dedicated to their own internal hiring, processes can be sporadic and unpredictable. Firms are frequently “not hiring” and then a new team member magically appears on the website.
With small teams and small firms, vague recruiting methods that vary across the industry, and a large quantity of impressive candidates vying for roles, venture can feel like a tough landscape.
Along with the difficulty we had saying no to many qualified candidates, it also pained me to see just how many folks were appreciative to even get a follow-up when we reached out to kindly let them know we didn’t have a position for them. Just like investors are notorious for ghosting on founders, it turns out people in venture are also guilty of ghosting on candidates. I received several notes thanking me for just responding. I also received notes asking for more feedback.
Unfortunately, I didn’t have the ability to reply to everyone’s questions, but I did want to share some overarching advice for those trying to break into the field. While each firm is unique, there are some common things we look for in candidates; they originate with deal review, but also apply to recruiting applications. They are:
Instead of looking to hire people above a certain bar, venture firms are looking to hire an individual who stands out. So, if we ask you about a favorite portfolio company, you can take the easy path and state one of our most prominent companies with an easily-accessible track record. However, if you pick a lesser-known one and have a good understanding of why it is unique, you’re much more likely to stand out.
Venture is about finding the non-obvious, but correct insight. The easier you can make it for us to see that you possess that skill, the better.
Do the work.
If you’re being hired to understand startups and emerging markets, don’t make the hiring manager guess about your ability to do this. There is so much information out there if you look hard enough. You can even reach out and chat with folks at the companies you’re trying to understand. Many people are more than happy to share thoughts and insights about their market, so don’t be afraid to ask. The more we see you can already do this type of work, the less a leap of faith it is to hire you.
While the VC hiring process is generally friendly and open, we still care about quality work and depth of insight. For example, if you are handed a 250-word writing prompt, you’d better be an amazing writer if you’re only going to write 50 words (yes, we get plenty of these short responses). If you’re replying to an email, take an additional 60 seconds to double-check the grammar and spelling before you press send.
This isn’t nitpicky, but rather the necessity of little things. The most junior people in VC can sometimes interact with the most founders, and investors really care about whether you’ll represent them well in the market.
Remember that a “no” is not always a “no.”
While it isn’t common, I’ve invested in companies where I originally said “no,” because they came back with additional data, wins in the market, or an undeniable passion. The same is true with hiring. While we received a few notes asking about further consideration within our hiring process, one stuck out to our team in particular; the passion for Forerunner and our mission was clear. We understood that our process was inherently flawed, and we didn’t do a great job of screening for drive, so this note made a material impact on our ability to see them on the team; we ultimately made the hire.
If you feel really strongly about a firm, don’t be afraid to lay it on the line. Sometimes, a little bit of extra fire can push you over the edge.
While the individual is important, we also operate collectively as a team. While we were hiring our analysts, some candidates looked like perfect fits on paper, but we had concerns about whether they would put our collective mission above their own personal goals. With social media, it is easier for younger professionals to build their own personal brand than ever before. While we applaud this, we also need to see someone who is going to put Forerunner first, just like the rest of us do. So when you’re interviewing to break into VC, be sure your personal ambitions don’t overshadow the desire to join the team and build from there.
While I can’t say this is a definitive guide, I can say that I would have benefitted from having this cheat sheet while I was applying for entry-level roles in VC—and hopefully those that have struggled in venture recruiting can apply these lessons.
If not, I leave you with this:
Don’t forget that there are many paths to venture, and most partners at venture firms don’t start their careers in VC.
Consider opportunities to gain exposure to the ecosystem through open positions within our portfolio companies. I already know of a few applicants from our process who are now in the portfolio; I consider those each wins for us, as well. We’d be thrilled to work with promising talent in this capacity, before you make that final jump to venture capital.