Tech Sales ---> VC?
Hey everyone, I'm exploring job options as I'm planning on graduating this December. I've been looking really hard into breaking into Tech sales rather than finance as I've grown an interest in the field lately. I was wondering if it was common for members of a software or high tech sales team to break into venture capital pre/post MBA? Is this common or does anyone know of anyone whose made the jump? There are plenty of stories out there of successful CEOs all starting their careers in sales so it doesn't sound out of the realm of possibility to make the switch to VC. I have always been interested in VC and I know that getting experience at a start-up or tech company is one way to break in, but I specifically want to know if its possible from a sales role. Let me know your thoughts.
No, and even if you've heard of people making the jump, anecdotal evidence alone should not be enough to persuade you to try it for yourself. Take the route most would advise and get into a more technical analytical role to have the best shot at VC. To your point of CEOs starting in sales - you are not aiming to become a CEO, and they did not grow up in the same time that we are right now. Much different era.
Unlike PE, you make make it into VC from a variety of different routes. With that being said, breaking in from Tech Sales will be much more difficult and you'd probably have to be a sales star for years before even having the opportunity.
VC is a product focused field, meaning product experience is king. Some make it in from tech banking which is somewhat relevant.
Although Sales has some parallels, a good PM or Tech Banker will far outrank you in terms of recruiting for VC.
If you really want to get into VC being a PM at a big tech company is your bet, followed by tech investing/banking of some sort(although banking with lend you towards later stage investing).
Tech sales can be a great career as well, in the early years you can make a ton of money and if you're into partying hard and having a good time, it definitely lends itself to that.
I understand your point and expected these kinds of answers. However, when you say VC is a product focused field, wouldn't a sales rep that is constantly selling the product and getting peppered with questions about the functions and use of the product he/she is selling be an expert after a couple of years? Especially since its normal to showcase demos of the product to executive clients. If you mean product focused as in an entire industry like SaaS etc., I guess the rep would only have experience under one specific company but I believe they would still have a good enough understanding of the industry in general to add value to a VC firm probing for investments.
Another question I had, many tech sales reps move to other parts of the company whether it be sales management or a strategy type role. Would you say it would be more possible to move into VC if you made a move to a more management/strategy role in the tech industry and then tried to make the jump to VC? I'm not expecting the answers I want to hear but there isn't much information about this topic so I thought it would be a good discussion.
A good thought, but you're a little bit misguided on what I mean by product.
Sure a salesperson will know the features of a product and how to sell it, but what a PM learns how to do and in VC what investors are trying screen for is a deeper understanding of not only how a product is built/designed, but where the key fit is in the market, how it impacts users, how users interact with it, and why people need it.
Sales is mostly persistence and repetition of an existing product that has already been vetted and is successful such as selling adwords at google or selling Salesforce. As a VC you'll get a number of scenarios where a new product or service is being offered and you need to have the understanding of who the product is targeting, how it scales, how it makes money, how it can get to market, etc. This is difficult to do when a new product/startup has little to no traction. That is the key element where a product manager/tech operator will have experience where in sales you never touch any aspects of that thought process.
For example, take Uber or Airbnb for example. Successful businesses, great products... now go back to 2008/2009 and imagine Travis Kalanick is pitching you an idea, its for an on demand black car service(that is actually how uber started) and later on he comes back and says that he's pivoted and wants to let normal people pickup others and act as part time taxi drivers for others. Sounds crazy right? Who the hell would let a stranger drive them around in their own personal vehicle. Someone with a product background will really think more about what does the market look like for this, is there a product market fit, how does the app work, can it scale, is it easy and intuitive to use and on and on.
I could go much deeper on this, but you get my point. Sure maybe in sales you could do deep on one product so if you were doing Sales at Salesforce and then went to a VC firm that only focuses on CRMs(there aren't any) you might be able to add some value. Other than that, the day to day sales skills and responsibilities don't get you to think about product and product market fit, which means you won't have a great skillset for a VC.
Regarding your 2nd question about going into the business. Yes that is a slightly more likely path into VC. Being a tech operator at a business can lend itself to VC especially if you align with a VC that is targeted on a certain area. For example, you ran marketing/growth at Nest and move to a VC firm that is focused on Internet of Things. From my own personal experience, I've seen that most people from banking/consulting backgrounds will enter through a corp strat/dev role and from there make their way into the business into either a marketing or product role. From here they would build the skills to eventually get into VC. I generally see fewer people move from sales into the business though.
So there's your answer, its long and not that well edited but the long short is the "product" experience one gets from selling is very different than actually building a product. Sales is a good career, but if you're optimizing for VC in the long run then its going to be a much tougher path.
Almost everyone in venture nowadays enters through one of these paths: - Successful entrepreneur or senior exec at a large company (almost always a product or business operations focused role like COO or VP of Product) -> partner - Exec at a startup (think director at a big company or VP at a small company) -> principal/junior partner - HBS or GSB MBA + relevant prior experience (pre-MBA PE/VC, consulting, or product management) -> senior associate - Tech banking analyst or MBB consulting -> pre-MBA associate
If you are not in one of the above paths, it is extremely difficult to break in.
How difficult would it be if you aren't specifically in TMT banking? If you are, say, a generalist banker but have done a tech deal, would that be competitive enough?
It's harder because VCs look for industry experience, and many headhunters that fill these roles will recruit specifically from tech groups. If you're in a top banking group like MS M&A you can still get these looks, but in general it's an uphill battle. It also helps tremendously to be local (e.g. in an SF/Bay Area group).
Not happening buddy.
Unless you work at a VC backed startup, are able to scale up their sales 100x in 3 years, are known in the industry circles as a rockstar salesman, you're supremely well networked and the investors have a very high opinion of you. And if that's the case, you're probably pulling in more money than a VC analyst/associate grunt.
If you still insist on being a VC with the above criteria met, then VCs MIGHT bring you on, more likely as an "operating" guy than an investing guy. You would be there to help scale the VC's portfolio company by helping them in sales, marketing etc.
Honestly, if you're that good at B2B sales, you should stick to it as a good salesman has a very high upside. And you could be on the CEO path sooner rather than later.
If you do insist on VC, then get into a product/operating role at a funded startup, get a top-tier MBA and try to make a switch. Or you can target tiny $75-100mn funds where they might be less structured in their recruiting.
edit
I highly recommend reading this thread http://www.wallstreetoasis.com/forums/current-vc-associate-taking-quest…, its very informative on many fronts!
There a few questions in there so adding some general insights
1) Long Term Career Objective - VC or CEO? The path from sales to CEO is more common than from sales to VC. The path from CEO to VC is very common. The CEO and VC positions both require many of the same skill sets BUT very different mindsets. CEOs lead teams, innovate, and are constantly selling a vision. VCs research, network, and allocate capital to companies that are small now that they believe will grow. There are plenty of VC Operating and Investment Partners that have sales backgrounds BUT most became VCs late in their careers and arrived at a Senior level. If your objective is to get into VC at the junior level, then tech banking or developing some entrepreneurial clout early in your career may provide a better entry.
2) Product - This knowledge is integral for a successful VC. In the most traditional sense, this is an engineering type who has held a product manager role. Nevertheless, most successful sales people know their product very well. An interesting truth is "a great sales guy is a good product guy and a great product guy is a good sales guy". It makes sense because without product knowledge you can't sell (to prospects) and without sales ability your product ideas wont ever be adopted. Wall Street finance backgrounds (IB/Research etc) do not build this knowledge in a meaningful way.
3) Entry Point - If your goal is to get recruited in to a fund as an associate, a finance background may help you get in but will not help much in your day-to-day. Most associates spend their days grinding for new potential opportunities and doing sales type work (prospecting startups, competing for meetings with promising entrepreneurs, etc). It's more similar to a tech sales role than a banking type role. PE is more similar to banking. At the more senior levels you will find hires from a variety of backgrounds (product, sales, operations, finance, etc). Depending on what firm you work for, there may or may not be a clear cut path to partner from associate. However, almost all VC firms have interest in landing top notch senior level talent.
4) Strategy - This may sound cliche but the best path for you is most likely where you believe you will be the best. If you think you will be a better sales pro than a finance type, then take that path. Think about yourself as a product. The more you flourish and show differentiation from your peers, the more attractive you will appear to a VC fund. VC funds want to find talent and thought leaders in areas where they are lacking - like any organization (but way more competitive than most).
5) Entrepreneurial Credibility - This is a very under-appreciated aspect of VC that must be addressed. Frankly, most founders have minimal respect for VCs that haven't personally experienced the start-up grind. It isn't necessarily fair but it's largely true that entrepreneurs are more skeptical of the Wall Street finance type VCs than ex-entrepreneurs. In fact, many ex-entrepreneur VCs will get pulled in to promising deals by entrepreneurs who seek their guidance. These VCs have a HUGE advantage over the VCs who have to constantly compete for founders' attention. A Wall St finance background, while bringing a number of other positives, rarely generates this type of credibility as it relates to guiding entrepreneurs.
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