What does a day in the life of a venture capitalist look like? (2024)

FAQs

What does a day in the life of a venture capitalist look like? ›

Working with portfolio companies: Venture capitalists often work closely with the startups in their portfolio to provide support and guidance as they grow and scale. This may involve attending board meetings, providing strategic advice, and helping to identify new growth opportunities.

You might only be in the office for 50-60 hours per week, but you still do a lot of work outside the office, so venture capital is far from a 9-5 job. This work outside the office may be more fun than the nonsense you put up with in IB, but it means you're “always on” – so you better love startups.

It is a fast-paced, exciting industry and ideally suited for someone who likes helping develop companies from the startup phase to commercialization. Careers in VC are less regimented compared to investment banking and private equity, and VC firms typically hire candidates with more diverse backgrounds as well.

Most venture funds have a 10 year time horizon to invest all of their capital and then return the profits to the fund's investors. There are exceptions to this 10 year life cycle, but that is fairly standard.

Venture capital associates operate in a unique area of finance. Unlike investment banking and other financial analysts who focus on modeling and deal execution, VC associates have less structure. Even at the entry level, VC associates are tasked with finding deals, meeting entrepreneurs, and evaluating business ideas.

The hours worked vary by firm type and size, but the average is around 50-60 hours per week. That means that you'll be in the office or meetings most of the day on weekdays, with relatively free weekends.

Most VCs distribute their time among many activities (see the exhibit “How Venture Capitalists Spend Their Time”). They must identify and attract new deals, monitor existing deals, allocate additional capital to the most successful deals, and assist with exit options.

Venture capital is a high-risk, high-reward type of investment, and there is no guarantee of success. While VC firms aim to identify the best opportunities and minimize risk, investing in startups and early-stage companies is inherently risky, and there is always the potential for loss of capital.

Still, working in VC remains the dream for some. Many try, and many fail. It can take over a year to find a VC job, even if you have good banking experience, says the ex-Goldman associate.

Remote work has become a new reality for many professionals, including those in the venture capital (VC) industry.

What is the 80 20 rule in venture capital? ›

In investing, the 80-20 rule generally holds that 20% of the holdings in a portfolio are responsible for 80% of the portfolio's growth. On the flip side, 20% of a portfolio's holdings could be responsible for 80% of its losses.

100/10/1 Rule - Investor screens 100 projects, finance 10 of them, and be lucky & able to enough to find the 1 successful one. Sudden Death Risk - Where the founder stops/loses capability to work on the idea. Investors usually choose the incubator strategy to avoid this risk.

The capital in VC comes from affluent individuals, pension funds, endowments, insurance companies, and other entities that are willing to take higher risks for potentially higher rewards. This form of financing is distinct from traditional bank loans or public markets, focusing instead on long-term growth potential.

How many hours a week does a venture capital partner work? Its usually quite long hours about 70–80 typically if they have a large team. Sometimes they are working all the time.

More than a dozen VCs reportedly spoke about seeking professional help, taking months off work and having friends and loved ones cut ties with them due to the stresses of the job. VCs are under pressure to generate returns for the businesses and individuals that invest in their startup funds.

VC firms raise money from limited partners to invest in promising startups or even larger venture funds. Another example is investing in larger venture funds. The larger venture funds can have a clear target in mind for the kind of companies they want to invest in, like an EV (electric vehicle) company.

It is a challenging career path, but it can also be one of the most rewarding, both financially and intellectually. So, if you are passionate about entrepreneurship, innovation, and investing, a career in venture capital might be just the right fit for you.