Becoming a Venture Capitalist by Gary Rivlin

Author:Gary Rivlin
Language: eng
Format: epub
Publisher: Simon & Schuster

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THE APPRENTICE

There are any number of ways of becoming a venture capitalist that don’t require first starting a company that makes everyone rich or arriving with a résumé that includes stints at LinkedIn, Twitter, and Facebook. Mike Moritz, who might be the best VC who ever lived, was a journalist, of all things. Moritz was in his early thirties, a staff writer at Time magazine and the author of two books—including The Little Kingdom, a well-regarded book about the early days at Apple—when in 1986 he was invited to join Sequoia Capital. Since then, he has been an early investor in Yahoo!, Google, PayPal, YouTube, Zappos, Instacart, and Stripe, the last of which was valued at $9.2 billion in 2017. That’s only a small share of the Moritz-backed companies that have IPO’d or been bought by a larger firm.

“The rule for getting into venture is that you demonstrate your business acumen as an executive or by starting a company,” said start-up lawyer Scott Dettmer. “But there are almost as many exceptions to that rule as people who get into the venture that way.” Allen Morgan had been a partner at one of the Valley’s best-known law firms when he was invited to join the Mayfield Fund as a general partner. “It’s not that unusual for a lawyer to go into venture capital,” Morgan said.

Wall Street has served as a reliable route into venture. Mary Meeker, Bill Gurley, and Kirsten Green are among a long list of Wall Street analysts who have made it big as VCs. Meeker is a more typical Wall Street hire in that she has focused on late-stage growth investments since joining Kleiner Perkins in 2010 after more than twenty years as a well-respected internet analyst at Morgan Stanley. Her late-stage investments have included Facebook, Square, Airbnb, Pinterest, Instacart, Snapchat, Spotify, the peer-to-peer site LendingClub, and the traffic and navigation app Waze. In 2017 Forbes ranked Meeker sixth on its annual Midas List.

Bill Gurley is also a regular atop the list. (He ranked just behind Meeker in seventh place in 2017 and topped the list in 2013.) Gurley, who played basketball for the University of Florida (he also earned an MBA at the University of Texas), worked as a design engineer for Compaq Computer before becoming a stock analyst—first at Credit Suisse, once the hottest investment bank in tech, and then at Deutsche Bank, which was trying to be. In the mid-1990s, he jumped to Hummer Winblad Venture Partners, a high-profile firm that fell short of its media hype; and then eighteen months later, in 1999, he joined Benchmark Capital, another high flier but one that exceeded expectations. A $6.7 million investment in eBay in 1997 that two years later was worth more than $4 billion (a return roughly six hundred times its initial investment) put Benchmark on the map, but it’s Gurley who has kept it ranked among venture’s top firms. These days Gurley is best known as the VC who, in 2011, led

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