When I started my summer internship at a venture capital firm a few months ago, I had a vague idea about how VC worked, mostly derived from pop culture, such as the HBO hit show Silicon Valley. I never really paid attention to it, mostly because of the insistence of pop culture and tech to portray the industry as something only for the mega-rich and their money managers. But the past couple months at McRock Capital have transformed that vague sense into a firm understanding and helped open my eyes to a world I now know I knew very little about. It was a steep learning curve to say the least, but here’s a couple of things that I quickly learned that really stood out and surprised me.
1. It’s a people business
All aspects of venture capital from deal sourcing to deal making to managing portfolio companies require having and maintaining good working relationships with people. As much as you need to have good business and financial sense, you also need to have really great people skills to have any sort of sustained success or longevity, and in truth, any enjoyment in the work you do. You rely heavily on your network of entrepreneurs, peers in the VC world, and co-workers. Without having good working relationships with all these people, it becomes nearly impossible to get anywhere.
2. You’re never not learning
At its core, venture capital is all about curiosity and learning. You are learning about companies in the sectors your firm is interested in. You are learning about how different companies operate, what makes their solutions or products different from their peers and competitors, and how macrotrends will shape their businesses in the years to come. Part of the job description of anyone in venture capital is being a constant and curious learner. And ironically, the more you know, the more you figure out how much you don’t know, which for most people, is a self-sustaining loop that pushes you to not fall behind.
3. Don’t stretch yourself too thin
There are so many companies out there. There are thousands of ideas, solutions, products, and pitches and that’s just in North America. There are multiple more companies in Europe, Africa, the Middle East, East Asia, South America, Australia, and in every other part of the world. Those companies are also in different stages and cycles of growth. It’s impossible to be an expert on everything so be a specialist. Most people in VC spend their entire careers on one focus area, and sometimes one investment stage in that focus area. Being a generalist is fine (sometimes) but being a specialist will take you a long way.
4. Communication, communication and more communication
The ability to effectively communicate is a skill needed in almost every type of job and industry, but it is especially true in VC. You need to be able to communicate your thoughts, your ideas, what’s holding you back, what you’re excited about, what makes you feel great, and what makes you feel uneasy. And you need to communicate all of that CLEARLY. There are so many different crucial lines of contact that need a clear gauge on your own thoughts from your bosses to portfolio companies to potential investments to even other firms and LP’s (a VC’s investor). You need to be sure to communicate what you want and need or else that lack of clarity will snowball into much bigger issues really quickly.
5. Have a process and trust it:
Your decision-making process, whatever it is, is incredibly important. What are your criteria for investment? What criteria do you have for management teams, for solutions, for financials, for yourself? How you make decisions on what to invest in and what not to invest in and making sure to trust your decision and not second guess it is crucially important not just for your own success, but for your own well-being and sanity. This process serves as a routine for you and allows you to focus on the process rather than the outcome. In basketball, players spend their entire careers having the same free throw routine and mastering it, so no matter if it is in practice or in the last second of a tight game, players have the same process that they trust and know that will lead to the outcome they want, no matter the situation. Humans can agonize over decisions for years after, which is terrible for your psyche and mental health, but if you have a trusted process you won’t beat yourself up as much. You’ll be able to say, “such is life!”.
There are so many things to be said about the VC world, and so many more lessons I’ve learned personally, but my eyes have been opened and I have realized that a career in venture capital is attainable and extremely interesting.
McRock Capital provides paid summer internships to recent graduates and young professionals from underrepresented minorities in the venture capital industry to educate them on a potential career in the sector and provide practical work experience. McRock was founded with Diversity & Inclusion as a key pillar of its culture. The McRock Summer Internship Program integrates candidates into many aspects of the VC business with frequent interactions with all members of its investment team including the co-founders.
