Hey VC-aspiring monkeys, Originally, my plan was to do a week by week take on the VC world as an intern, similar to moneymogul's IB one - however, both my internship and the VC world is very different from IB, so it wasn’t feasible to do that way. So instead, I’ve documented my first week and I’m happy to have this be more of a Q&A type of thing for VC internships/people looking to start a company/anyone interested in the VC world. There isn't a typical week, and I also work with our portfolio companies a lot, so feel free to ask about various startup jobs as well. I can say that this won’t be as well written as moneymogul's, but bear with me! Hopefully it gives you a sense of what this industry is all about. Background about the firm: European fund. Small - 100mm AUM in the fund. Over 25 portfolio companies currently - Seed stage investments primarily, with some Series A & B rounds.
Background for me: I've mainly done off-cycle internships, first one was as a Business Analyst at F500 Financial Services, second was data analyst (marketing & finance) at top tech firm (think Apple, Google, Amazon, Microsoft), and now VC firm. European background, but American university (top 50 - semi-target-ish) Names have been changed to protect the intern and yadda yadda. Monday ---------------- There's always a slight skittishness when you're starting at a new place (particularly in a new city), but I strolled up at 8:50 to be nice and early. A little too early apparently, as my associate, Emily, hadn't arrived yet. I'd only spoken to her on the phone briefly, as my main interview process was with the firm's recruitment/talent seeker and then one of the partners. I get buzzed in by someone working on one of the portfolio company's and wait in the reception area. The place is all open plan and houses around 8 startup companies (most of which are portfolio companies), as well as our small VC team. At around 9:05 or so, Emily shows up and we chat for a bit and shows me to my space. This is where VC and small teams are very much different from my prior experience at large companies - it's just a space on an open plan table next to some other startups. I had opted to go business casual, but on the formal side, and I'm glad I did. A suit would have been very out of place here - the startups are wearing t-shirts and jeans, and the partners are wearing business casual. She asks if I want to grab a second screen, but I say I'm fine working off my laptop for now. She goes and puts her things away and I wait patiently, surveying the buzz that is slowly ramping up throughout the floor. She comes back moments later and gives me a tour. Around 70-80 people are in and out of the floor basically, and the VC team is in the corner where I'm sitting. The founders show up, which is quite nerve-wracking for an intern to be meeting (they are all very successful in the industry). Very friendly and ask me a few questions, but then get back on with their day. Emily informs me that they're going to go into their weekly meeting to discuss whatever is coming up and any deals that have come in. She says it can take up to 3 hours at a time - so they do it over lunch usually. Emily has to go and get some work done that the partners need, so she leaves me explore a bit and just kind of hang out. There's no intranet to explore, so I'm a little bored, but Emily comes over and asks if I want to get lunch at some point, I accept and say I'll meet her at 12 near her desk. After perusing our website and various companies, I head over to Emily's and we head out to grab lunch. We walk down a road that has a bunch of different food options and decide on something 'local'. We chat about our backgrounds and what she thinks of the firm - she's only been there a year. I inquire a little more about my position and what's expected, and then we head back to the office - sufficiently full and wishing I could lie down and nap a little. I head back to my desk, where I don't have much to do for a while, but Emily comes over and asks me to effectively do a SWOT analysis on all 25+ of our portfolio company. I dive right in, never having done one before, and discover all that I can about the companies. Little did I know that this would take me two full days to complete. 5:15pm rolls by and I decide to call it a day, which makes me feel a little bad since everyone is still hard at work (most arrive at 10:30/11 and stay until 6 or 7), but I have a bus to catch and not that much urgent work to do. Tuesday ---------------- Wake up at around 7am to grab an 8am bus. Quick breakfast and shower and then I’m out the door. It's a pretty cold morning, but not too bad. Sit on the bus and oof, screaming kids of course. I finally get off and I'm in the office at 8:45, well ahead of anyone in the fund, but some of our portfolio companies are already in the coworking space working. (And people say bankers work a lot...). Get set up and grab a coffee when Emily walks in and says hello. We chat a little and I head back towards my desk to continue working. Emily says she'll come by and show me the dealflow system when she has a minute. Emily comes by and invites me to our deal flow. It’s not very sophisticated - pretty much Excel and Google Docs… I’m a little taken aback, but I soon learn that the industry as a whole is pretty archaic (ironically) when it comes to managing their portfolios. The main premise of how our deal flow (and most early stage firms’) is that there are a few ways that deals can come in:
- Referrals (This is THE single best way to get funded or at least your name out there - the majority of our investments are through referrals. As in 65% of all investments we made last year were through referrals)
- Cold call - We keep one public email address and it gets hit with business plans like no other. Another common form is people sending in paper decks (which is a major no no in our view. Yeah, you may be trying to be different, but you just wasted $150 and 5 trees to show me your high-tech company… Additionally, I now have to MANUALLY scan the files into our dropbox folder for record…)
- Either people we seek out or meet at events. Events are the lifeblood of VCs. I am not kidding when I say that networking is absolutely everything in the VC community. It is such a small, tight knit community that everyone knows someone who knows someone, and things travel very quickly. Do not burn any bridges if you want to work in the VC world. Sometimes, you can, but for the most part - it gets around. Really quickly.
Emily asks me to see if I have any recommendations about the flow. I tell her that I’ll get back to her after I’ve explored it some more. My first step is to fix some of the messier formulas in our Google Doc that cause it to take 657.8 years to load. Emily leaves and I continue to work on the SWOT analysis yesterday. It’s effectively just to see my style as well as see if I can identify any weaknesses that they may not have thought about within their portfolio companies. I get introduced to two CEOs/Co-founders of various companies, which is par for the course here, but pretty exciting for an undergrad student… I notice that the average age of our founders & startup employees is mid to late 20s, with some younger and some older. I chat with one of the partners for a bit about my background (I didn’t interview with all the partners, just our recruiter, associate, and one partner). As I sit near them, I get to see how they operate together and what their days are like. They’re all former tech workers in some regard. Their days are spent mostly in meetings with current companies, potential companies, or other VCs - it’s all about managing appearances. Unfortunately for startups, we’ll often hear pitches from people that we don’t have an interest in investing in just because they were referred by a friend in the industry (I think this is pretty par for the course, I’m afraid). I continue to work on my SWOT work and monitor deal flow before calling it a day at around 6pm after the partners have left. Wednesday ---------------- Still struggling to wake up early after having some time off and then a fairly relaxed course schedule this past semester, but I manage to drag myself into the office by 8:45 (despite having missed two buses…) [I don’t know if I’m cut out for banking….] The office is pretty quiet in the mornings. My associate will get in at around 8:45-9, the first partner isn’t in until close to 10/11 and most portfolio companies aren’t around yet. I would say around 20/70 people are in the office before 10am. Some more deal flow has come in from a company we’d previously passed on. They’re raising a follow on round and want to know if we’d be interested in participating. My associate says that once we pass, that’s pretty much it. Since we look early on at the idea and the team (very important in early stage) I keep working on the analysis. This is my first time ever doing a SWOT analysis and it’s taking a surprising amount of time. Just finding competitors is very time consuming (when you have 25+ portfolio companies, they tend to add up!). I keep working through and the office begins to begin buzzing at around 10:30 and actually gets pretty loud at around 11am. 2 partners still haven’t come in, so I presume they’re off in a meeting somewhere around the city. Some err…unusual… deal flow comes in. The first is a deck from a company that we passed on two years ago, but the entire model has changed, so we’re potentially willing to look. Except they’re looking for $1mm as their first round, which is very optimistic and well above where we usually invest (our average is ~250k for 15-20%). Another decks comes in with a line saying “potential to be the next Facebook”. I cringe at that line. If you have to be the one to say that, then it is very unlikely… One big difference that I notice between working at a partnership and firm like this versus working at a product focused company is that there aren’t really deadlines or pushes to get things done by a specific day - everything happens more organically because there are no launches or need to increase revenue through constant selling of goods or services. Thursday ---------------- I get into the office before 8:30 (finally!) to get some work done, but get slightly distracted by general browsing and some of the deal flow. Another deal has come in that is similar to one of the businesses we’re in. It has pretty good revenue and good growth figures (but not insanely optimistic). Not something we’ll invest in, but always good to keep an eye on the sector. My associate comes in at 9am so I get back to working on my analysis. Emily comes over and asks me about my day and plans for the weekend. She mentions some good bars to go to around the city. Two partners stroll in within 10 minutes of each other, so it must be a pretty busy day as they’re in early. I finish up my analysis at around 12:30 and get some lunch. Bring it back to my desk (par for the course here - and everywhere else I’ve worked). I browse through the deal flow a bit more. It’s incredible how many pitches come through with major spelling and formatting issues. It ruins the point that you’re trying to get across! After handing in the analysis, I don’t have much else to do. So I browse around and look at the usual sites (TechCrunch, VentureBeat, etc-) just to see what is going on. I head out a little after 5:30 as I don’t have much else to do! Though it’s the beginning, I’m working far less hours than I did at the tech firm last internship. Friday ---------------- Finally, Friday rolls around and my first week is over. I’m in at 8:45, and it’s very, very quiet (more so than usual mornings), which is nice. A pitch deck has been referred to us and I take a look. It’s a little ambitious…. They anticipate revenue growth from 200k to 62mm in 5 years..., as well as a 2000x return on profit… It is very well put together and has some backing, but still very ambitious. I continue to comb through the deal flow and see what is of interest. A few things are interesting so I forward them along to my associate and see how she wants me to proceed. She asks me to reach out to them and see if they can send a one pager over. A one pager is effectively an executive summary of your business - a bit about your current financials and idea and team - just a teaser to get a VC interested. 10:30am rolls around and the office isn’t buzzing too much, must be a bit of a lazy friday! I sift through more of the deals that have come in and organize them into the weekly spreadsheet for the partners to go through in their weekly catch up meeting at the beginning of next week. I’d love to be a fly on that wall. At this point in time, we’re starting to spin up a new fund, so there is a lot of work to be done on bringing in LPs and organizing any documents and pitches as we work to raise capital. I continue browsing around and looking more into the startup ecosystem when I get an invitation to one of our portfolio companies' party and their CEO now follows me on Twitter - which may seem slightly trivial, but it’s a worlds away from university for me. My afternoon is primarily spent talking about valuations with my associate, as well as learning more about capital tables (models we use to discuss and assess various rounds of funding that we’re involved with and to see how our equity will change as we bring in new investors (since there is obviously dilution that occurs as you bring in additional rounds). It seems as if there are some issues with one of our companies who is currently raising a round. We’re participating to ensure that we don’t get too diluted (depending on the company, sometimes we’ll participate, sometimes we won’t, sometimes we’ll put up a large amount of money to be a bigger investor ~ >2m). Partners have been discussing it all day and on and off the phone, but it seems as if there has finally been a resolution and all parties are satisfied. I continue to look at more deals and Emily asks me to swing by to take a look at a deal she has seen and what my thoughts are on the product. I wasn’t really into it and it didn’t seem like it had a strong future. Additionally, pro-tip: please don’t call yourself a disruptive innovation - let your product do the talking. 5:30pm rolls around and beer o’clock has begun for some of the portfolio companies - whilst the partners are about to jump on a board call to continue talks about the cap tables. I decide to take off as I don’t have much else to do and want to be able to get out and explore a little! After having wrapped up my first week here, I do enjoy it. It is very, very different from working at any sort of company that sells something - the atmosphere is just very different, not bad different, just an adjustment for me. ---------------- Apologies for how long the above was, but the tl;dr is “I’m a VC intern. This was a week in the life (sort of). Q&A. Anyways, with that “week in the life of a VC intern” done, feel free to ask me almost anything! I’ll try to answer as quick as I can, but I won’t always be able to immediately, so sorry I’m not sorry.
