Q&A: 3.2 GPA -> IB -> PE -> VC

Hi All,

I've been a long time lurker on this site and decided to make an account and post an AMA as I think my insights could be useful. A bit about me but intentionally anon:

  • Went to regional semi-target
  • Did internships in middle market S&T, ~$2.5bn credit fund, no name M&A IBD
  • Graduated and went to work at no name tech IBD, was fired
  • Worked in PE after being unemployed for a few months
  • Made transition to VC

Bit on current role: Deploy in $100s of M per year, technology only.

I can answer questions about having a low GPA going into IBD, paths to VC, comparison from IB/PE/VC, getting internships in non-traditional ways (I was rejected from all major programs).

I hope this is helpful!

Comments (20)

May 12, 2022 - 6:02pm
liquidity_chaser, what's your opinion? Comment below:

It was partly right place right time. I already had an IB internship under my belt at another firm and the bank I ended up working for had recently spun the entire team out to form their own firm. They needed analysts to keep up with deal flow and I was there with three finance internships under my belt.

The other half of that is I genuinely believed in my ability to add value and be useful and that came across in how I interviewed. I had a 3.85 major gpa and knew the finance/modeling skills, knew how to network very well, and was open to learn and work hard.

Ultimately I wasn't a good fit for that group because they needed someone a bit more experienced and since I was a new grad I needed some hand holding at the time (related to my other comment about being able to hit the ground running), and ultimately lost my job as a result. Was a humbling and important experience for me because I learned the value of really doing something that sucks in order to push towards a greater goal and made me a better investor and employee today as a result.

  • 4
May 12, 2022 - 12:27am
thebigpot, what's your opinion? Comment below:

Hi 

So, there are a lot of things and material on how a day looks if you are working in IB, PE etc, but what exactly is the role of a person who has joined a VC firm? Also, how do you find working in VC versus in IB and PE and what are some of the key differentiators in the working style? Thanks.

Most Helpful
May 12, 2022 - 6:07pm
liquidity_chaser, what's your opinion? Comment below:

I can only speak from my experience. My fund is ~$1bn mid-late stage so keep this in mind.

Banking cares more about "doing deals" than "why should the deal get done?" and the difference lies in the revenue model. Banks generate fees via transactions to generate revenue, funds generate revenue via carried interest (mainly), so we (and PE) have to be 1000x more thoughtful in why a certain area of tech is interesting because if we're wrong, we don't make money. A banker doesn't have to be right. As an example, a buddy of mine recently told me he took a company public via spac 6 mo ago and is now pitching the same company a take-private at half the valuation. Not much thought on why, it's only fee generation.

Day to day is different than PE/IB. We do diligence more quickly in VC since we primarily follow on and have less materials to work with in the data room. I spend a significant more amount of time meeting with founders/CEOs than I did in either of my other roles combined. My opinion is valued a lot more as well. It's not a finance culture, it's a tech/finance blend culture.

  • 5
May 12, 2022 - 1:33am
YabberShneebs, what's your opinion? Comment below:

I've noticed a lot of the top VCs prefer product managers/people who have worked at acquired startups. How did you set yourself apart with a more traditional finance background?

May 12, 2022 - 5:57pm
liquidity_chaser, what's your opinion? Comment below:

That's a good question. You're right in that there's a bit of a "chinese wall" that separates VC candidate supply chain from PE/HF/etc. where VC prefers PM/former founders/engineers/etc.

In terms of differentiation, I had started my own small SaaS company with a friend who is a full stack web app dev as a hobby not a genuine business which stood out to those I interviewed with coupled with the fact that the group I am currently with is seeing so much deal flow that they don't have enough manpower to deploy the amount of capital they would like. I come with transaction experience in technology companies whereas a PM would need to learn to model and write a memo so someone with a PM background wouldn't be able to hit the ground running but would know tech better than me day one whereas I can (and did) hit the ground running and learned tech at a PM level semi-quickly.

  • 3
May 12, 2022 - 6:10pm
liquidity_chaser, what's your opinion? Comment below:

Learn to network and don't be afraid to fail or be stupid on networking calls if you don't know what you're doing. The person ultimately won't care and you'll learn to be better.

Uncover every stone where there might be a career opportunity or good connection and stay in contact with those people. The skillset you'll gain from this will 100% put you at an advantage to Joe Wharton who has OCR and doesn't have to scrape and claw for what he wants.

  • 1
May 13, 2022 - 6:26pm
liquidity_chaser, what's your opinion? Comment below:

I'm not sure I would say there is "one" paramount factor that trumps them all. Keep in mind, you don't need to follow any traditional clear cut path.

Networking is very important (see my other comment) and following up on opportunities. I got introduced to the MD that hired me for my first year analyst role from an offhand comment that a bank was spinning out someone made on a memorial day hike and I followed up with that person who knew them after the hike.

Opportunities that come from OCR or traditional paths are going to be the path of most resistance since there's the most awareness of that route. I got my S&T internship by emailing an MD and asking to subscribe to his newsletter because I thought swaps were interesting at the time. He then offered to interview me because he was impressed a 19 year old was genuinely interested in what they work on. My goal in emailing him wasn't to find an internship, just to learn more.

  • 4
  • Incoming Analyst in PE - LBOs
May 13, 2022 - 11:59am

Hey! I was wondering what you thought of your credit internship and what and how much you learned from that. Thanks!

May 13, 2022 - 6:35pm
liquidity_chaser, what's your opinion? Comment below:

I was on the bond / swap trade desk, not in a credit investing role, sorry could have been a bit more clear. The investment team was another team entirely.

I learned a ton at that role. At the time I really wanted to be a bond trader full time (this was over the course of my senior year). I got an offer to trade MBS out of college in addition to my IB offers. I had seen everyone I look up to in trading either get fired, laid off, passed over for a promised promotion, etc. at some point in their career and be jaded with it entirely since the industry was contracting / growing at a miniscule rate. Something many don't understand is 80% of a business' success comes from selling products into a market that is growing ie has a hard problem to solve (if you want to dispute this, fine, but read "On the Granularity of Growth" written by a McKinsey partner whose name escapes me). Now when I make investment decisions, the most important factor is the market (google "the only thing that matters by pmarca", if interested).

Biggest lesson I learned was that the version of trading I fell in love with and was my passion really only existed in Michael Lewis books and didn't exist anymore. I needed to reconcile that with the real world, and learn a skillset in an industry that is actually growing. I ultimately did, and I'm very glad I made that choice.

  • 5
May 14, 2022 - 9:37pm
liquidity_chaser, what's your opinion? Comment below:

I did not get any position through diversity hiring, gender, sexual orientation, etc. means 

  • Incoming Analyst in PE - Other
May 15, 2022 - 4:59pm

Do you think GPA really matters if you have a few years of work experience when lateraling and what's the usual GPA cutoff for PE/IB? Thank you!

May 15, 2022 - 6:32pm
liquidity_chaser, what's your opinion? Comment below:

Accusantium quia sunt vitae maiores libero odio. Quaerat et magnam necessitatibus omnis odit.

Voluptate corrupti nostrum necessitatibus quos quis reprehenderit et. Consequatur nam eum saepe porro rem. Facere consequatur et maxime maiores est laborum. Est maiores eius voluptates consequatur mollitia. In unde voluptates sequi magni et error vero. Sit ea laborum modi enim. Consequuntur fugiat non assumenda aut labore voluptas optio.

Start Discussion

Career Advancement Opportunities

May 2022 Investment Banking

  • Jefferies & Company (▲03) 99.6%
  • Bank of America Merrill Lynch (▲03) 99.2%
  • RBC Capital Markets (▲06) 98.7%
  • Lincoln International (▽02) 98.3%
  • Houlihan Lokey (▲07) 97.9%

Overall Employee Satisfaction

May 2022 Investment Banking

  • Jefferies & Company (▲12) 99.6%
  • Rothschild (▲02) 99.1%
  • Truist Securities (+ +) 98.7%
  • Greenhill (▲06) 98.3%
  • Houlihan Lokey (▲07) 97.9%

Professional Growth Opportunities

May 2022 Investment Banking

  • Jefferies & Company (▲04) 99.6%
  • Bank of America Merrill Lynch (▲06) 99.2%
  • Lincoln International (▲03) 98.7%
  • RBC Capital Markets (▲08) 98.3%
  • Houlihan Lokey (▲06) 97.9%

Total Avg Compensation

May 2022 Investment Banking

  • Director/MD (9) $661
  • Vice President (36) $393
  • Associates (180) $246
  • 2nd Year Analyst (109) $161
  • 3rd+ Year Analyst (17) $156
  • 1st Year Analyst (348) $148
  • Intern/Summer Associate (73) $146
  • Intern/Summer Analyst (272) $91