Executive Search Firm | Careers & Industry - Venture Capital Industry

Industry: Venture Capital Industry

Overview:

The venture capital industry is based off of making educated but risky decisions. Venture capitalists invest in promising new companies in order to fund their growth and profit. Many venture capital companies are now focusing their funding on already established companies that have proven their potential for growth because this lowers the venture capitalists risk. Many firms are focusing their funding on specific growing industries such as technology firms. Venture capitalists have supported some of the most well known businesses such as Apple and FedEx and made their growth possible. The reward for investment can be substantial, but the venture capitalist must be willing to take the risk.

Required Skills & Credentials:

Individuals looking to work as a venture capitalist must focus on their networking because job opportunities in the venture capital field are hard to come by and personal recommendation may be the only way to gain a position within the field. There are only a few hundred venture capital firms, which makes the competition for open positions very steep. Industry knowledge is essential and networking with insiders is beneficial in order to gain access into this highly elite community. Typical positions within a venture capital company include partner, junior partner, and analyst. Individuals who work in the venture capital field feel satisfaction in their work when they see a thriving company that was once struggling without their investments. Venture capitalists also make a wealthy income, but it can take a few years to see a return on their investment. This is why there has been a trend in investing in already mature companies, since venture capitalist are at less of a risk and can make a profit more quickly. Many venture capital firms are investing larger sums of money into already thriving companies in order to grow them to the next level.

Analyzing which companies to invest in and how much to invest is one of the most important roles in the venture capital industry. Analysts look for market trends, areas for potential growth, and the probability of the potential business plan to be profitable.

Benefits & Drawbacks:

The downside of working in venture capital is knowing that even if you firmly believe in a potential business plan or company, the investment may be vetoed by management authorities. Individuals must learn to roll with the punches and have enough drive to keep motivated even when their idea may not move into action. Working in venture capital firms means being the middle man between companies and their funding. Venture capitalists are often viewed as outside employees who do not have a hands on role in the company. If you want to work hands on and make the internal business decisions for the company, then venture capital may be too far removed for you. However, many venture capitalists enjoy not being directly involved in the day to day business ordeals because they are able to look at the big picture growth opportunity for the company and the industry as a whole. Venture capitalists analyze companies, industries, consumers, and investments on a large scale in order to take educated risks.

Working in venture capital can be thrilling to risk takers and those willing to take a gamble in hopes for a big win. Venture capitalist must perform thorough research and analysis on potential investment opportunities while maintaining the understanding that some investment risks may end in failure. Venture capitalists are able to make a healthy salary if they make wise decisions, know the right people, and have the internal motivation to stay strong during difficult times.