Long-Only HF to VC? Has anyone made the switch?
I'm currently an analyst at a ~$40B LO HF considering a switch; I have a STEM degree (hard science but not CS) from a school just under top-tier (Duke, UChicago etc.) and have ~2.5 years of buyside experience.
I've generally enjoyed that the culture at my current role is cerebral and intellectually stimulating, and I like learning about businesses and industries; however, what's become clearer over time is that our investment horizon is much shorter than we claim it is (it's more like 6-18 months).
I think VC seems interesting because I see analysts taking genuinely taking long-term views, but I am put off by how much the VC role seems to depend on just sourcing deals - e.g. my current role in contrast is very solitary, library-environment-type work.
Has anyone made the switch, or understand how feasible it could be? (feel free to DM me if you're in a similar boat)
Also, fwiw my style as an equity investor has skewed more towards longer-term and quality-focused research. In my current role, while this type of analysis is always required for us to take a position, it's less central to the strategy as we won't invest unless there's also a differentiated short-term view playing out in the next few quarters. In contrast, in VC I would expect the long-term analysis to be more actionable by itself, which seems like it could be enjoyable to me.
You could try, you've got a solid pedigree for sure (albeit not one VCs would typically find compelling), but it really doesn't sound like a fit for you.
The first half of this just isn't correct 80%+ of the time (most VCs are not taking a truly "long-term" view, they're making 20-30 asymmetric long-tail bets hoping 1 or 2 pay for the rest and return the fund), the idea analysts are the ones developing long-term views might be true for ones at the big multi-stage funds but for general VC focused on a 1-2 stages that's not the norm. The latter attitude really points to VC not being a fit for you. If you don't like the idea sourcing you have 0 chance of ever being successful as a VC, that's quite literally the most core competency of the job. Most VCs don't work alone in a library researching for weeks and weeks to make a call on whether or not their deep analysis warrants an investment. They're not worrying about managing active positions because once you've bought something you're committed, so instead it's all about getting yourself out there to meet founders and build networks. This changes somewhat if you bring operating experience to the table / are a previously successful founder, but you have neither of those creds so the point is moot.
In reality, the grass probably isn't that much greener. I'm more familiar with the bigger institutional LOs than LO HFs but it's my understanding that at a solid LO you will likely make more over your career (certainly higher at almost every level in cash comp unless you're a breakout rainmaker) and potentially have better job security. The idea of "taking long-term views" in venture just doesn't sound compelling enough IMO to make that move, but perhaps you have other reasons you didn't share. All the best either way!
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