Career as a Venture Capitalist

Venture Capital is the process wherein investors finance new businesses. Start-up companies that receive venture capital are perceived to have excellent growth prospects but don't have access to capital markets because they are private companies. In return for venture capital, investors may receive a say in the company’s management, as well as some combination of profits, preferred shares or royalties. One could enter into a career of venture capital if one is a wealthy individual investor, or by working in investment banks, and other financial institutions that pool investments in venture-capital funds or limited partnerships. There are also Venture Capital firms who invest in private companies. In return for this investment, the venture capitalists exact a price, like, say a significant ownership of the company and seats on the board of directors. For the most part, venture capitalists focus on companies in the technology, medical and retail sectors. Venture capitalists raise money from institutional investors, state pension funds and high-net worth individuals, usually in the form of partnerships. The risks and rewards of venture capital investing can be extreme.

The Prospects
Venture Capital firms are always looking for people. When a firm finds someone they really like, they can afford to hire them. The simple reason is that the “right” person will add a lot more value than they cost. One starts as an Associate Capital Venture with a capital venture firm, an investment bank and other financial institutions. The work would initially include researching and analyzing different businesses and working on various financial modeling for companies in which the firm would be investing. The individual will need to play a leading role in the firm’s investment effort from sourcing to execution. The associate will need to gain significant transactional experience working on active deals closely with the principals of the firm. After having passed this stage there are quite good chances of enhancement in position of an associate within the firm.

Following are some of the most popular  Venture Capital firms with the respective details of their field of investment:

• JPMorgan Partners - provides equity and mezzanine financing for a variety of investment opportunities.
• Finance Capital - private merchant banking concern providing investment opportunities to corporations and high net worth individuals through equity investments in emerging companies.
• The Carlyle Group, a private equity firm.
• Sequoia Capital - invests in technology components, systems, software, and services.
• Kleiner Perkins Caufield & Byers
• Primedia Ventures - focuses on Internet infrastructure products and services, mobile applications for communications and commerce, and business services software applications.
• New Enterprise Associates (NEA) - invests in early-stage companies.
• Draper Fisher Jurvetson - focuses on information technology businesses.
• Atlas Venture - early stage venture capital firm investing in communications, IT, and life sciences companies.

Personality Traits

• Winning and strong personality
• Keen business judgment
• Spontaneous and alert
• Good listener
• Good reasoning capabilities
• Great time management

Salary

An associate would earn anything between Rs.3.50 Lac- 4 Lac per annum after which one can keep getting great appraisals within the firm depending on their contribution to the firm and also after some experience one is quite in demand in other investing organization as well. As your experience grows your earning capacity grows tremendously in this career. A partner in a venture capital firm could earn anything above Rs.80 Lac per annum, depending on the organization one is attached to.

Study Routes

The right person for a Venture Capital firm can have almost any background and degrees ranging from Psychology to English, and industry experience from non-profit and government to management consulting, investment banking, business operations, and of course, entrepreneurial activities. It is however advisable to undertake an MBA and have keen interest in finance and business. If, one’s initial interest is quite strong in finance then it is advisable that at graduate level itself one starts molding themselves in the line of finance and business. One could do B Com Honors from a reputed college and then an MBA with finance as your specialization. In case, it is while undertaking your graduate degree that you feel your interest towards a career in Venture Capital is growing then one could finish their graduation and then proceed to undertake an MBA with finance as a specialization.

Source: Compass One

For further details about related courses and colleges please click below:

Related courses and colleges