Job Description

Venture Capitalist

A lot of technology companies could’ve failed without venture capital. Netflix, Facebook, Apple, and Google – all depended on venture capital when they were starting out. People read about successful Silicon Valley entrepreneurs in the news, but not many people know there are investors that help these entrepreneurs grow companies. Last summer I worked as an investment intern shadowing a general partner at a venture capital firm in San Francisco.

A venture capitalist invests money in startup companies that have the potential to grow in exchange for equity in the business. Venture capital is risky because the returns depend on whether the company they invest in grows and exits through a sale of the company or initial public offering. There are two primary roles within a venture capital fund: general and limited partners. General partners (GP) are professional investment managers. They advise entrepreneurs given their past operational experience, raise money from limited partners, identify key investment themes and invest in promising technology. A limited partner (LP) is typically a cash-rich government, corporation, person or pension fund that gives money to a venture capital firm.

Three responsibilities that describe the role of an investment intern at a venture capital firm are: 

• Deal sourcing

• Deal evaluation

• Market research        

I’ll explain the duties of what I had to do on a typical day.                          

Deal sourcing

• Attend technology conferences and networking events

• Cold outreach potential target companies to learn more about their business

• To build and maintain relationships with entrepreneurs and other venture capitalists

During my internship, I went to the J.P. Morgan Healthcare Conference in San Francisco. At the conference, an industry peer introduced me to the founder of Mission Bio. Mission Bio is a startup that performs single-cell DNA analysis. The goal of Mission Bio is to deliver targeted treatments to every single diseased cell through precision medicine by looking at the origins of the disease. I exchanged contact information with the CEO and introduced him to my boss. After two meetings, the firm I was working for understood Mission Bio’s value proposition and business model before investing in the company.

Deal evaluation

• Identifying management competency

• Business model momentum

• Market size and validation

When meeting a startup for the first time, I aimed to learn as much as possible about the business and team. I tried to figure out how the founders met, how competent they are and if they really understand the problem they are trying to solve. Then I would go through their business model to figure out the company’s cost structure, assets (i.e., patented technology) and value proposition. This information allowed me to understand how the team will take their product or service to market. A valuable lesson I learned was to figure out if the company had an innovative solution or product that the market hadn’t yet realized and would satisfy customer needs. After the first meeting, I would validate the market size and see if there is a real pain point for consumers that the product could solve. I was able to do this by figuring out how many customers or users were using the product. 

Market research

• Identified market trends to help in risk analysis of asset allocation

• Created investment memos for LPs detailing market analysis and company overviews

• Evaluated future trends

Market research was the most critical part of my summer internship. If I didn’t complete this work, the senior partners at the firm would not have a high-level overview of the companies in their portfolio. I had a competitive advantage by researching because it would allow me to be aware of the latest industry trends, which could influence investment ideas of the firm. Also, if I hadn’t created investment memos, then it would have been difficult for the general partners to raise money because they would have no marketing materials to share with future investors. 

Readability

• Flesch Reading Ease 46.4
• Flesh-Kincaid Grade Level 11.3
• Passive Sentences 0%