Advice for landing PE/VC job
I am a dual degree student at Stanford doing a Ph. D in Computer Science, and an MBA at Stanford GSB. I am in the 1st year out of an estimated 5-6 years.
I am primarily interested in entrepreneurship, and I am developing a few ideas as a Ph. D student. In the ideal case, I will be able to start my own venture after graduation using my research. However, if those plans don't come to fruition, I will likely look for a job in PE or VC, preferably in a position where I can leverage my technical background to make investment and operational decisions.
I have experience from summer internships during undergrad in Asset Management and in venture capital. I was competitive for BB IBD/PE analyst positions, but did not find them fulfilling. I don't mind 80+ hour weeks, but I prefer meaningful work.
Can people please give me some advice about how to tailor myself over the next five years to remain competitive for jobs in both PE and VC post-MBA?
In particular:
1.) I am currently working as a part-time software engineer at a startup which is highly likely to IPO at some point. I am learning a tremendous amount both technically and operationally. However, I am curious about whether 5 years part-time work experience improves my resume or simply slow progress on my degree? (My only prior work experience is summer internships)
2.) I am considering studying for the CFA. I imagine that I could complete this before graduation. Would a CFA score me bonus points?
PE is going to be exceptionally tough without having a great deal of deal/transaction experience. I'd focus on VC.
Call up VCs who are Stanford Alumni and ask them exactly what you should be doing now to make this happen in the future.
Tell us a litlte bit nore about your propose research.
Why do you imagine you would be doing more "meaningful" work in PE/VC now as opposed to when you turned it down after undergrad?
^^^^ My question as well...
My professional opinion is that you can study for the CFA for your own personal edification, but I think having a PhD and MBA from Stanford already puts you in an elite class.
I agree with Clarkey that you should focus on VC. Given your background, you're a prime candidate for a job in a software/technology focused firm.
Time permitting, I would absolutely stay at the start-up. That kind of experience is invaluable if your intention is to go into VC. At some point, I think it will be important to get more direct VC experience but I think you can do that once you get closer to graduation (ie the summer before you graduate).
Not sure that the CFA is completely necessary, but it definitely couldn't hurt. If you can find the time to do it, more power to you.
Broadly, my research is focused a software solutions for smart grids. I'd rather not go into detail here.
So it seems like a good idea to spend my spare hours at the startup for now, and then perhaps look for an internship or part-time job in VC during the summer (or year) before graduation?
I realize that "deal/transaction" experience is a requirement for most PE shops. However, I would think they would need some industry experts in house, particularly for speciality shops in tech/cleantech. Would the CFA help compensate for lack of deal experience in PE? Should I forget about PE entirely?
Drexel- to answer your question- I think that a post-mba gig in PE or VC would be more meaningful than the offers I saw as an undergrad because of the background I am building in the tech/cleantech sectors. I prefer to understand investment opportunities from the inside-out, rather than plugging numbers into a spread sheet. Having said that, I don't mind "paying my dues". I understand long-hours and some uninteresting work comes with all jobs.
The CFA is not needed for PE and will certainly not make up for absent deal experience. I can't stress this enough. Also, in PE any specialist knowledge that is needed is outsourced.
Have you thought about setting up a Consultancy doing Technological due diligence for VCs. It would be a great way to build up your Network and experience.
The way I see it is you've got 4-5 years left. If you think the startup has true potential, stay there. Otherwise, consider starting your own business. A large number of people in VC come there after having successfully started and run their own companies. It might be something to look into if you have a decent idea for a business, think you can find a partner or two, and think you have the time.
I don't think you should completely rule PE out if that's what you really want to do. It's true many shops look for pre or post-mba associates after 2-3 yrs of IB and/or prior PE experience but there are exceptions to every rule. I'm not sure that CFA would help compensate for lack of deal experience. CFA, in my opinion, is more valuable for investment/Asset Management and not necessarily PE (caveat: i'm not in PE nor am I a CFA holder).
It's true many shops have industry experts in-house. Many of which are former CEO's (many of which have been exec's in multiple co's) who have a wealth of operating experience in a particular field.
dont do any CFA. youre profile is strong. CFA adds no value neither in terms of knowledge nor in terms of signaling as you are doing a phd MBA which is enough. My amateur advice would be to network as much as possible over the years, attend the stanford venture lectures and keep getting numbers and names. When time comes, youll be able to make a call or two and will have some great opps either in terms of getting funded or in terms of getting hired.
If you are receiving an MBA & PhD from Stanford, and your focus is on software for smart grid, please strongly consider sticking to your guns and starting your own company.
With the US depleting its energy capacity and throughput capability, and the need to reduce energy consumption as well as deploy technology to improve processes and enhance services, our economy needs top-notch engineers working on developing solutions for the smart grid. Also, there are great economic tailwinds in this market (this isn't news to you but I'm going to throw out the stats anyways):
-Total capital outlays in the sector are expected to steadily expand to nearly $30 Billion over next 5 years. -This does not include incentive based investments for new Nuclear Power Generation capacities being recommended by the Department of Energy and Congressional advisory groups.
These changes will open new opportunities:
-The electric delivery system in place today has been in use for 100 years, and underinvested for nearly 40 years. With no increases in grid efficiency, America is slated to begin rolling brownouts by as early as the year 2020 -IBM, Siemens, Johnson Controls, GE, Oracle, HP, Microsoft will continue to respond to this high profile market, making significant capital outlays within various parts of the sector -Utilities will place more responsibility regarding energy efficiency onto the consumer and 13% of all U.S. households will have smart electric meters by 2013
(yes, I did just rip these bullets from a presentation I put together)
With this market profile, it's a great space to raise capital (especial for someone with a PhD/MBA background). GridPoint and OPower just raised $100M and $50M in this space very recently. With your background, I would be shocked if you couldn't raise angel financing/vc to launch your platform/idea. One thing that you should consider is moving to the DC-area post-graduation, as a lot of the market drivers around smart grid are related to government funding and regulations (both GridPoint and OPower are DC-based - OPower does have offices in San Francisco though).
I recently completed a 6-month consulting engagement with 2 PE/VC investors in the DC area that are focused in the space, and DC is a great spot to launch something in this area. One of the investors is a PhD too, and I would be happy to make an intro. I'm certain that you have access to a great network through Stanford, but happy to help in any way.
Just a little bit of a ramble there, so to answer your question, you should be fine for PE or VC. I disagree with Clarkey that PE will be exceptionally tough to get in for you. Find a PE firm that invests in software and energy efficiency, and your value proposition will be pretty clear. The CFA is probably not the best use of your time - especially if you're interested in appealing to PE/VC firms. I would focus on being exceptional in your studies and your part-time work and things will come together just fine.
Chris
Would like to see how OP has progressed through the last 3 years. What did you decide to do?
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