Hi all,
After having done two internships with the respective companies following my graduate studies, I now hold two FT offers with MBB and a up-and-coming tier 2 VC, $1bn AuM. Long-term, it's my goal to move to growth VC/PE, but I'm thinking a year of MBB first would strengthen my CV and give me a better standing in VC rather than having no FT experience and also better chances for transitioning once in VC/PE. I enjoyed my time with companies a lot, so it's hard to make a decision based on that.
Ideally I'd want to have both on my resume, hence go for MBB first, but I'm afraid the VC gig is too much of a once in a lifetime chance. Any help would be much appreciated!
This is a choice about optionality vs. conviction. If you know VC is what you want to do and have conviction this up-and-coming firm is going to crush it and become a brand name over the next 3-5 years, you should take the VC offer. However, if you're not certain you want to do VC vs. Growth/PE or if you're not sold on the VC's firms chances of crushing it, you should take MBB.
If you're asking for my personal opinion, I would go MBB. Three reasons:
1. I'm risk-averse. MBB is the safer starting point.
2. MBB gives you more optionality and can get you to the same point. Maybe you do a year or two of MBB and decide you want to do PE or Growth. If that's the case you can easily recruit for top firms from MBB. If you still want to do VC you can get a top VC offer from MBB too - I have former colleague who work at Insight, Sequoia, etc. If you go VC first it's much harder to move up market to Growth or PE.
3. MBB is a great safety net. Let's say the up-and-coming firm flames out - if you have 2 years on MBB under your belt and the network that comes with it before taking the bet on a firm you will be able to land on your feet pretty easily. You'd probably still be alright if you want straight from UG, but networking for your next job would be tougher.
Risk aversion is a strong reason for me to consider MBB as well. Hoping I can negotiate a PE style t+2 years start date with them (or at least 1 year), convince them it'd be to their advantage as well. But considering how small VC teams are and how rare hiring is, I'm not sure they'll be able to make such a commitment.
All good arguments for MBB>VC
To play devil's advocate, I think you should go with the VC firm for the following reasons. A $1B AUM fund with multiple unicorns is no joke. I'm generally pretty down on VC firms, but if you can land at a top quartile firm and one with good investors, a good brand, and strong dealflow, you're going to be fine. As long as they have enough capital to do deals for ~2 years, I wouldn't worry too much about the firm going to 0. The track record sounds that a few more fundraises are probably likely. That's all very different than a $50M AUM shop started by a single guy/gal. So from an experience standpoint, you'll likely get some good VC reps and will be able to grow and expand your network well.
I'd also argue that although MBB will set you up well for the traditional recruiting process for PE/GE, most VCs really don't conform to traditional recruiting processes and the seats that open up are very much few and far between. There's 0 guarantee that even with a stellar MBB career, that you'll be able to find a similar type of role in 2 years time. The fund might love you, but again, given the lower AUMs of most VC funds, they might only have capacity for a couple of junior investors each year. Plus, they're going to optimize for folks that have VC experience and networks, not for MBB consultants who can create pitchdecks and talk about strategy initiatives they recommended at F500 companies. That's not to say that what you learn at MBB won't be valuable, but it's just not as relevant.
At the end of the day VC and PE investing in general is an apprenticeship. You learn by doing deals and observing what other investors do. If you think you want a career in this world, take the "risk" and start off with it. You'll have plenty of chances to do MBB down the road if you want to. If B-School is in the cards at all for you, you can very easily do a summer internship or short post-MBA stint if you want the brand on your resume. Good VC opportunities don't come up very often and I think you're right about the competition from MBB into buy-side roles, especially VC ones. With that being said, the only merit to taking MBB (aside from what MikeRoss posted) is that if you're considering going to a more traditional PE firm, you'll likely have a decent shot through the traditional headhunter recruitment process. That process will not be as clear on the VC and growth equity side of things.
My opinion is take the VC role, it's not as big of a risk as you think and it sounds like a pretty good gig. Good luck with it.
This is a great take. Looks like I still have a thing or two to learn from the Great Harvey Specter
Thanks a lot for this - very helpful indeed. Do you think moving from the shop I'm looking at to something like a General Atlantic, Battery Ventures etc would be much harder than coming from MBB?
If you want a career in VC, go for VC. A $1bn AUM shop is no joke depending on their approach to portfolio construction. VC is also ultra-competitive. Everybody and their dog wants to work in VC because of how chill it is, how interesting it is, and that it still pays will with the chance for massive upside.
That said, MBB will give you a much broader, well roudned skillset (probably, consulting is like a box of chocolates, you never know what projects you're going to get). For example, Bain is so gung ho about generalist programs, you will do cases of many different sorts while there.
This ultra-competitiveness is exactly what's holding me back from building a strong safety net with MBB first - I'm sure there'll be plenty of MBBs applying to the role if I don't go with it. I've heard stories of plenty of MBBs trying to get into VC and not being able to do so or landing at much worse shops than the one I've got the offer from...
Thanks for the SB. So do you want to end up in VC, or do you want to preserve optionality and kick the can down the road of what you want to do in life?
I feel like this is dependent on the specifics of the VC firm. Does T2 mean just one notch the sequoias/accels of the world or does it mean a consistently third of fourth quartile fund? If the latter, take MBB. If its a fund posting good returns and raising capital consistently then go for it.
I would agree, the median VC is shit and to go someplace as an analyst I'd like something top quartile or maybe second quartile.
@jsbg, if you PM me the name of the firm I can check out returns in pitchbook for you assuming you don't have access to any databases
Thanks, from what I remember from the internship, their returns were pretty good. They enter at Seed to Series B and have around 7 unicorns in their portfolio. At the moment I feel like trying to postpone their offer and get at least a year of MBB under my belt first. Am I right in thinking it might be harder to move from tier 2 to tier 1 than with a clean sheet coming from MBB?
Hard to judge - they're no Sequoia but from the DD I did so far, they're renowned for their network, helpfulness and bright minds working there. Got several unicorns in their portfolio and have been raising new capital consistently - I'd be staffed on a new fund that was just announced, so lots of dry powder.
Those are all good signs. I think the exact reputation of the fund is important so, if you are not willing to disclose it to anyone on here, then try to reach out to people who you trust.
From what you have said, I lean towards saying the VC offer seems better for you.
Facing the exact same problem but replace VC with Growth Equity of $8B USD (Tech, Education, Healthcare). Long term goal is unicorn management or startup. Pay is 25-50% higher at Growth with similar growth trajectory. Leaning towards GE but hard to turn down MBB, especially coming from low-tier semi-target.
If you want to PM (I am not stealing analyst seats any time soon) the fund, I can give you my honest take, just an offer, feel no pressure. In general I'd say go with the fund, recruiting sucks no matter where you're from.
Would love to get your take on it but am a newbie on wso and noticed people aren't disclosing company names here for some reason...
PMed!
I was also interviewing with an $8bn b2b Software Fund, would've taken it in a heartbeat but they froze hiring due to covid prior to the last round. Wanna chat about it offline?
Feel free to PM
8B growth fund means something like Insight or Summit. Take the GE offer. people from MBB compete to get into a fund like that. Those funds will provide the brand strengthening that you seem to want (even if it is specific to tech/venture).
Would totally do the same - but in my case it's definitely not insight, summit etc. Nevertheless their team is top-notch, from GS/MS/JPM and MBBs. Obv. MBBs will compete for the 8B fund but I think same goes for my 1B...
My guess is you are talking about Lead Edge. I would take them.
why?
There's another thread talking about them. They are clearly a good growth shop that is doing well fundraising and have good investments. They pay a lot and you can easily switch into a good portco from them/go to b school. There's more uncertainty sure, but a lot of upside.
Lead Edge is $3B and not $1B as the OP mentioned. Also, to clarify, they’re more growth focused now and not explicitly “VC.” However, would still take Lead Edge given the track record, team size, comp, upside at firm and for future career in tech investing.
That's true. I initially read it as fund size, not AuM.
It's not lead edge. €1bn AuM, entering at Seed to Series B. So now the question is: if the long-term plan is to move to late-stage VC/ GE, better to enter with this one now or go through MBB? Hoping to land at something like Battery Ventures in a few years.
couldn't someone go from MBB to lead edge? What is the advantage to going directly and missing out on MBB optionality?
You'll likely be much more disappointed if you went to MBB and that VC ended up making an absolute killing than if you went to VC it didn't work out that great but could look back on it and say you gave it a shot and the cards just didn't pan out.
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