Quarter Life Crisis

I spoke to Marco
Thompson, founder of a small VC fund (Express Ventures) in San Diego, about this subject and he
confirmed some of my suspicions about this career path.  VC is something you do towards the end of
your career, not at the beginning.  The
rationale is that only an ex-entrepreneur who has been there and done that can
foresee the challenges an entrepreneur will be facing and gauge whether he and
his team have the whole package to make the venture work.  He added that lots of associates equipped
with MBA’s work at many prominent VC firms, but they are generally regarded as
bleh (grunts) by the rest of the venture community since you’ll be generally
playing an auxiliary role for the firm. Corporate ladders are not applicable in
VC - you’re automatically CEO if you can raise your own fund.  But who’s going to give you money unless you
have a track record of doing big things?

Job description for a typical MBA associate:

John Doe joined Forward Ventures in
Sept., 2001, and is responsible for reviewing business plans, conducting due
diligence on potential investments and supporting Forward Ventures' existing portfolio
companies.  

Reviewing business plans and conducting due diligence sounds like
fun, right?  Er, not really. Why? A.) The
great ventures don’t really need a business plan- they come from people who
have done it before - so if your reviewing a BP, chances are very low that your
firm will invest in it. B.) Bottom line is that you won’t be making the final
investment decision. You can try to make a convincing argument for a venture
that you like. But that's all you can do. C.) Due diligence can be tedious. 

After hearing all of this, I still wasn’t convinced. You
know all that stuff doesn’t sound all that bad compared to I-banking or
engineering. You still get paid six figure salary, get a fat bonus if a couple
of your fund’s portfolio companies get acquired, and you get to schmooze with ballers
and wannabe ballers on a day to day basis. OK, so maybe the partners won’t
respect you because you haven’t done something as big as they have, but its all
relative- being a grunt at a prestigious VC firm would be A-ok for me and would qualify
as a big thing in my book. (Of course it pales in comparison to starting a multi-billion dollar enterprise like the partners did but you catch my drift.) Maybe you don't what it takes to be a great VC, but I am sure this type of experience
and VC pedigree will open up a whole lot of other opportunities in entrepreneurship and
elsewhere. I believe that network you establish and the experience you gain working with entrepreneurs, analyzing markets, and assessing opportunities will make you one hell of a start-up CEO.

And looky looky, looks like Bessemer Ventures has a rather large and impressive group of MBA
troopers, many of whom have a background or some professional experience in management consulting and
investment banking.