MagicalHamster

AMA: I work at a large VC Fund focusing on early stage investments

Hey everyone.

Thought I could do an AMA. A bit about me - have 4 years of work experience and graduated from a non engineering college. Was at a startup before (from Series B to Series D) before becoming a VC

Personally look at consumer and B2B investments here

Happy to answer any questions around life as a junior VC, startup ecosystem, career growth etc.

17mo ago

Find out if you are being paid fairly.Download Grapevine

SquishyBanana

Freelancer17mo

This is the biggest problem with VC ecosystem 4 yoe kids taking calls on experienced, hardworking founders. Dude first learn the game then invest , judge people playing the game. VCs know nothing about how to run startups. Unless they have been entrepreneurs themselves. IMO It's a colossal waste of talent to become a VC for young PPL.

TwirlySushi

INDMoney17mo

I feel this is a bad take. There’s no proof that founders make good VCs. These are two different disciplines.

Good disciplined investing is an art most founders don’t even understand

Also if you think age is what matter in making good decisions, you’re just being biased for ‘experience’

MagicalHamster

Stealth17mo

You do need to build out teams especially when you are investing/managing a very large capital pool (you can't have just partners running the show)

I do agree with the sentiment that somebody with less work experience could be bad at being able to evaluate. However, ultimately the deal team does include people who have been in the industry for over 10 years (and been successful)

VCs know nothing about how to run startups: Possible (and especially about team building), but most successful partners have not necessarily been founders - they know much better how to deploy funds

Lastly about it being a colossal waste of talent for young people: has been a very rewarding role for most of the people I know. It is a better job that a lot of alternatives I had at that juncture of my career :)

TwirlySushi

INDMoney17mo

Second question from me: Is it true that most VCs fail just as lost startups do?

MagicalHamster

Stealth17mo

VCs do fail but not as much
Good ones get all the LP dollars constrained with them

The business works in a way that risk gets naturally hedged across startups. So unless you completely fuck up and over index on one space (as John Doerr did with Cleantech) you will end up doing okay if you fund the right spaces and founders

MagicalHamster

Stealth17mo

The good ones get really good at identifying the right founder archetype

TwirlySushi

INDMoney17mo

Thanks so much for doing this. Do you agree that breaking into VC is very hard for most people?

MagicalHamster

Stealth17mo

Yes It’s a business that only works with small teams The largest funds have 30-50 people in investment teams at most

They are also very selective (Tier 1 college, Consulting) but that has changed slightly over time

GroovyCoconut

Stealth17mo

Do you think their hiring approach to these kind of roles will get diverse? Lots of great talent out of Tier 1, Top consulting firms too.

ZippyTaco

Student17mo

Is there a nice way to say 'No' to a founder who pitched to you? Most VCs end up ghosting!

How do you make sure you reject the founders in a more humane way?

MagicalHamster

Stealth17mo

Have always ensured I don’t ghost (should have a 95%+) success rate

The nicest way I have realized is to just honestly say what the internal view was - the exact reason we are not moving forward

Mature founders will understand and appreciate. Others will argue.

Unfortunately though, a lot of times you write on email and context gets lost

BubblyDumpling

Stealth17mo

Salary with time and career? Just trying to understand the salary bonus and career path

MagicalHamster

Stealth17mo

Hey My first role was at a startup at Series B with 12 LPA

I grew to 20 LPA by the end (after 2 years) before moving to the VC fund where I now make ~55 LPA (VCs have a standard pay, so my previous pay didn't deter them from that)