Been on WSO since I was in college and got a lot of value from being on here. Here is a quick overview on me:
- Currently an investor at the venture arm of a well-known internet company (not FAANG or M7) in the Bay Area
- I went to a state school in a state that isn’t NY/CA/MA. 1-2 graduates from my school get an investment banking or equity research job each year if any.
- I got some looks from MM banks but joined a boutique tech IB out of college. I did that for ~18 months and worked 60-85 hours a week
- I had a 3.8 GPA with honors and was very involved in our school's investment club. The GPA and honors helped me get 1st round interviews and the club was incredibly valuable in teaching me financial modeling and stock research. I can’t recommend investment clubs enough.
Happy to answer any questions on IB recruiting, VC / CorpDev recruiting, or anything else!
What was your decision process for choosing the boutique over MMs?
All else equal, a MM is probably better than a boutique: Likely to have better training, better deal flow, and a better network when you leave IB.
But the boutique was tech-focused and the MMs I was interviewing at were generalists or focused on something else. I think it’s important to get into your area of interest.
When I got to my current position, there were investors who went to a UBS/Barclays/Morgan Stanley but weren’t in their tech groups. There was a lot of basic tech stuff they didn’t know when they joined (building a retention analysis, LTV/CAC, etc.) and they didn’t have a good understanding of what “good” metric were in SaaS. Their ramp up was longer than mine despite going to a much more prestigious bank.
Pros and cons to both, but I’m happy with the choice I made.
That makes sense, I am also a firm believer that role/work > brand name. I started my recruiting process with the tech industry as a goal in mind and was fortunate enough to land an SA offer at a MM in their tech group. Could you go into more detail about what you found unique or stood out to you about tech IB that usual guides like the 400 question BIWS guide don't cover?
What does your day to day look like in your current role? How much do you have to “deploy”? If you don’t mind sharing, what’s your TC?
We invest off our balance sheet so we don’t have a specific $ amount we need to deploy or timeline to do so. Doing 5-15 deals a year. TC for an associate is in the $180K-$250K range and is base salary, bonus (not very big), and stock in the public company.
Day to day is a lot like that of traditional VC but we spend a little more time on research and strategic thinking. Certain companies are more or less interesting to us because of who we are and markets we want to enter or don’t want to enter.
Sarah Tavel, a partner at Benchmark, did an interview on TWIS where she talked about Rakuten leading Pinterest’s Series C and this being the reason that they launched Pinterest in APAC sooner than they would have without the investment from them. I think that’s really interesting to know that Rakuten obviously had a lot of conversations about how Pinterest was disrupting advertising / eCommerce and how Rakuten could work with Pinterest to better position themselves for this disruption. CVCs don’t have LPs so returns are nice but most investment committee talks go like this: Big market, incumbents suck, new innovative approach, lets invest and launch a partnership/JV, then build deeper partnerships as they grow or buy them if it makes sense
Hey man, I'm starting in a corporate VC ~2 years after graduating. Do you think founders look at corporate VCs differently than traditional VC? Do you feel like the day to day work is any different? Curious to get your thoughts on pros and cons of corporate vs traditional VC
Founders definitely treat us differently because we are different. We aren’t returns focused so by definition we have other motives. A lot calls or emails end with them saying something like “you’re not investing unless there’s a clear and obvious path to you helping us grow” but they’re always respectful about it. We get a lot of meetings that turn into that but we also get a high response rate on sourcing since everyone’s heard of our company (as opposed to a “random” VC)
The day to day isn’t too different at the junior level but is very different at the higher level. There’s also less room at the top in CVC and lower comp since there’s no carry.
To be clear, I do think moving from CVC to VC is very doable at the junior level and there’s a lot of overlap. You don’t learn everything you need to but I’d say it’s much better than staying in banking if you want to move into VC.
Thanks for doing the Q&A! It has been helpful and insightful so far. I was wondering how you went about sourcing the role. Was it an open position that you applied for or did you network your way into the position? What was the interview and recruiting process like?
I applied on LinkedIn but we’ve also hired through recruiters.
The interview process was straightforward: 6-7 interviews with a simple case study.
I always recommend learning as much as you can on the company before going into the interviews. Type the name of the company/firm or their partners into Spotify and YouTube and listen to every interview their execs do, read the “thought pieces” their partners publish, do all of that. If you can go into an interview and use their lingo and act like you’ve always been following them, you’ll differentiate yourself
Thank you! What was the title of the role on LinkedIn?
Thanks for all this great info. For CVC, are most offices (for large companies) around the Bay Area, or do you know of teams that operate from other regions (TX/FL)?
Short answer is that many of them are in the bay area.
Long answer is that some companies will put their CVC group in the bay so that they are close to the tech/VC community but but I don’t think it’s that common to do so. Many companies that have a CVC are already bay area tech firms so their CVC team is in the bay because the whole org is.
CVC teams don’t really need to be in the bay area though since, as I said in a comment higher up, they’re treated differently. We’re not hustling to lead deals or meet entrepreneurs in every sector.
Another thing to note is that some big companies will not have a separate venture group. If they only do a couple of deals each year (if any) it can be part of the M&A team’s work.
That being said, it’s still venture. People try to act like Austin, Miami, Boston, or other cities have this growing ecosystem but they don’t compare to the SF/Bay Area. The gap haa gotten smaller post covid but it’s still pretty damn big.
Thanks so much for taking the time to answer. I am very interested in the process/ any advice to recruit for VC in the Bay and wonder about how you landed a job at VC and your recruiting process. Another thing I struggle with is finding an “area" I am interested in as there are so many spaces in software to look at and I am afraid to miss out on some great companies and trends. Knowing those are very big questions, so very appreciate the time.
It’s hard and it sucks, especially if you don’t have any stand out things in your resume (Harvard, Goldman, etc.). Corporate venture groups care a lot less but it’s hard.
Another really important point to make is that the venture landscape has been crushed and most firms aren’t hiring. They are very unlikely to take chances on untraditional candidates.
How are you enjoying CVC?
It’s fun but can be political. The company’s mission does influence some of your investment decisions and certain R&D initiatives mean that some investments are off the table.
But not all CVCs are built like mine. Some are SUPER strategic and do 1-2 deals a year, some don’t care at all and operate like a normal VC
Great read, thanks for the help! I'm starting at a CVC in a couple months and was curious as to how the technical/modeling aspect of your role in CVC compares to your time during IB. I just finished my masters, was wondering if you had any tips on how to prepare during my free time before I start? Thanks again!
Not a ton of complex modeling, it’s not much more complex than something you’d see in IB.
It’s super important that you understand your industry and all the big name startups in it.
Ask your coworkers to flag 3-5 important investment memos or industry reports to read before you start.
Considering the crushed venture landscape now, would you recommend IBD-CVC as a career pathaway?
I would absolutely recommend CVC to anyone in IB who may or may not be able to break into a top VC, especially in the current environment. I think it's really important to note that a tier 3 or "bad" VC is, IMO, a worse place to be than a CVC. a CVC doesn't have as much freedom and their deal volume is lower but you get to leverage the brand & partnership opportunities to get in front of some great Founders. Dedicated CVC groups still get deals done and you gain a lot of strategy experience as well as deal experience.
If you join a CVC, you're in a great position to 1) Move into corporate strategy, 2) Join a startup in a growth, finance or operations role, 3) move into traditional VC assuming you did notable deals, or 4) tap the corporate network and get into the best MBA program you can
Hey man, I'm still in college and learning about the roles. Do you mind explaining the difference between Corporate VC and normal VC?
Would you recommend starting of with IB and transitioning to VC later on, or starting with VC right away?
Keep in mind I would want a good amount of money out of college, or a bit soon, but the looong hours in IB are not flattering
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