I have an offer from a tech venture capital fund. But I might have to take a paycut (about 10-15%) to join them.
Here's my pros and cons list
Current IB job:
Pros:
- #1 bank in this sector in my country. Undisputed leader by far.
- Unparalleled deal flow and deal closure: closed 4 deals in my first year.
- Record breaking bonuses.
Cons:
- Investment banking is...mundane at times.
- The bank doesn't have the best brand name, though getting there. The brand name is not good enough to get a call from marquee VC/growth equity funds, the ones that pay the most $$$.
- Internal team politics.
Question 1) If I join a smaller fund, how easy/difficult would it be to move to a larger fund?
2) How easy is to make a move from a firm doing tech VC investments to a sector agnostic growth fund?
Cheers,
IRSPB
I went from a $500M AUM no name shop to a $2B AUM somewhat known shop and am now heading to a $5B AUM brand name shop. Happy to share thoughts over PM.
My summary comments are: - Comp isn't everything as it tends to true up in the long run for guys with really great experience - You can make the move to most types of funds with the right experiences
My take is that you can always go back to banking, but the window to move to the buyside, particularly VC, is a lot smaller with fewer entry points.
In my opinion, as long as you're making the switch due to the experience you believe you're going to obtain at this new opportunity then I say go for it. A lot of people are willing to take a pay cut to go buy side just "because" (and buy side firms know it), that makes no sense to me. If you have a purpose though, gun for it!
Keep in mind, when you go to VC, there is no path upward unless you're at a small fund where you can grow into your role when they raise future rounds. And there depends heavily on the relationships you will build with the people there, which is something we can't assess on WSO.
VC is so unpredictable, and so many firms want you to have meaningful operating experience (as a founder or as someone who had a huge part in growth) to help validate. Modeling doesn't mean much unless your firm is mainly growth stage / Series B-ish.
I know several people in VC that went to B-School (to never return, or want to return), several who realized they were "stuck" and just went on to be a product manager at a smaller tech company, and others who completely exited. I just got into Wharton for my MBA and even with that pedigree people who just "interned" at VCs (both the megafunds and the local ones) realize those inherent risks in making those careers a full time thing. I also just talked to a friend who was a KPCB fellow over the summer too. Like...ehhh. It's glamorous and exciting, but keep in mind that if you're really really serious about VC being your "end game"....you gotta know that...for the most part, VC should be your last job, not closer to your first.
Hope that helps balance the perspectives out.
Only 10-15% pay cut? What are you worrying about. But it is also likely that you don't even like to work in a VC shop at all. That should be the #1 factor in your decision-making process.
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