The Path To Being A Venture Capitalist

Something that is garning a few headlines these days in the tech world is the Ellen Pao discrimination lawsuit against Kleiner Perkins. Pao is seeking $16 million in damages. Liz Gannes of Re/code has been live blogging the proceedings and for those with any interest in the inner workings of venture capital it’s fascinating.

The past two days John Doerr has been on the stand. Doerr is without question one of the most successful venture capitalist over the past 20 years or so. He funded companies like Compaq, Netscape, Symantec, Amazon, Intuit, and Google.

During a jury witness Q&A period with Doerr Judge Harold Kahn posed a question of his own. How do you learn to be a venture capitalist?  When pressed Doerr said the following.

My advice to people who want to be in the venture capital industry is to forget about it. To go be a successful entrepreneur. To have the experience of having to lay people off because you can’t make a payroll. That’s not something you can learn in a class. Once you have that
experience, I think you should apprentice yourself to a successful venture capital firm. You should read the business plans. You should see how venture capital firms conduct themselves, how they give clear answers. And the hardest thing of all is to become a good judge of what makes a good entrepreneur or good CEO. So you develop a sort of pattern matching of what works. And you should seek mentorship.”

While Doerr seems to believe that venture capital is an apprenticeship trade and people read business plans the most fascinating aspect of his entire testimony is that as one of the most successful venture capitalists ever he is telling people that want to get into venture to go start a company, make it successful, and then get taken under someone’s wing. It may to be the traditional path but I am not sure that is the most common path these days. People that start and lead successful companies generally don’t like people telling them what to do. It’s part of the reason why there is an emergence of so many new venture funds.

March 6, 2015  |  Comments  |  Tweet  |  Posted in Venture Capital