How To Become a Successful VC in 5 Years

This post originally appeared on Quora in answer to this question: If I want to be a successful VC in 5+ years, what should I do today to prepare myself for that role?

Answer by Leo Polovets, General Partner at Susa Ventures,

A VC has several major responsibilities:

  • Get access to great dealflow.
  • Given dealflow, pick the best companies.
  • After picking best companies, do everything possible to help them succeed.

If you want to become a successful VC in five years, I’d work on each of these skills. There are many ways to improve each one.

To get great dealflow:

  • Build out your network. Meet tons of VCs, founders, engineers, researchers, etc.
  • Master a horizontal skill, such as growth hacking, mobile dev, or SaaS pricing. If you’re the “go-to person” for something founders and investors value, they’ll want to talk to you, even if you’re not a VC yet.
  • Master a vertical, like 3D printing or CRM software. Again, if you’re an expert in some field, founders and other investors will want to talk to you, whether or not you’re a VC yourself.

To learn how to pick companies:

  • Take an associate role at a VC fund. Sit in on meetings, listen to the questions that VCs ask and the decisions they make. Compare their decisions to the ones you would’ve made.
  • Make small investments through sites like AngelList and FundersClub. FundersClub provides 10 to 20 pages of diligence materials for many prospective investments, which is a lot of information for making your decisions.
  • If you lack the capital for small investments, create a fantasy portfolio. Keep track of companies you would and would not invest in, and why you think they would/would not make for good investments. Monitor those companies over time.
  • Read books and blogs about venture capital. (Just search Amazon’s book section for “venture capital.”)
  • Find mentors in the VC community. Most people are happy to share their knowledge and experience when asked.

To learn how to be useful:

  • Build out your network. Along with improving dealflow, a network that’s wide and deep is a great asset for helping founders.
  • Master a business vertical or a horizontal skill. Again, these are good for improving dealflow, but also great for being helpful.
  • Interview founders. Ask them what they want help with, where they wish they had more help from investors, who their favorite investors are, and so on.
  • Be helpful, starting today. Whenever you can, try to help startup founders. Practice makes perfect.

Answer by Jason M. Lemkin, Managing Director @ Storm Ventures, Co-founder/CEO at EchoSign (acqired by Adobe), NanoGram Devices:

Make several amazing angel investments.

Or, found something venture-backed that returns 5x to 10x to VCs.

Or, get as senior a role as possible in as hot a company as possible, and network with a lot of VCs. This is a tough way, because there are so many startup execs … but on a percentage basis, it seems to represent a decent amount of VCs.

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