| Topic Name: |
MBA vs. third tier VC |
| Message Name: |
some points |
| Date Posted: |
05/22/2003 |
| Message: |
here are some thoughts
* i agree that a small fund is not necessarily third tier, but chances are it may be. it depends on your syndicate, etc. if you happen to source a deal which involves a syndicate with a top-tier fund, i would consider that a solid acheivement (and maybe then you go to b-school). why? because you get the chance to make a relationship with a top VC which is very difficult to do.
* small funds have a difficult time getting into quality deals with top syndicates, especially in a time where 500M-1B funds want to deploy as much capital in a deal that makes sense. it will be difficult for you to make an investment where you don't already have a strong relationship.
* a 30M fund probably doesn't get board seats so it may be difficult for you to show that you add "value". see if they have gotten board observer seats in the past
* realize that the apps to B-schools are at the peak. unless you are very confident of getting into the PE/VC top-three schools (HBS, Wharton, Stanford), you'll have a difficult time competing in the PE/VC job market in 2005-2006. the # of VC/PE placements out of b-school fluctuated since the boom, but its always been relatively low.
* investigate the track records of the partners of the fund - have they syndicated with strong, top tier funds? do they have a good rep? have they had significant board experience in previous VC roles?
* Have you considered a job at one of the big tech companies? Working there for 2-3 years and then going into PE/VC will give you a much stronger edge applying to PE/VC jobs than startup+ B-School. look at the changing dynamics of partners in VC and you will see there is strong emphasis on operating partners, people who've had experience at companies and startups. and working at an intel, cisco, oracle, motorola gives you "real" contacts as opposed to the fluffy crap contacts a lot of VCs really claim to have. problem is getting a good job at one of those companies are tough - but its worth trying.
* when you think about who your contacts are, ask yourself if they are just acquaintances, or people who are willing to go to bat for you (give you inside info, do some work/diligence for you, put in a good word for you, get you in front of a customer, etc.). weigh this as a factor when determining which career choice you make. look at the background of the partners at the firm you are considering - is a relationship with them a strong asset? in my opinion, i've noticed that the main asset of b-school really is the contacts and friends you make there.
* what is the vintage of the fund, and how much trouble are they in? how much capital have they deployed. this is difficult to glean when you are applying for a non-partner position, but try to find out! this is very critical to your job decision.
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