Guides / Career guides / Venture capital
Venture capital: backing companies early.
Venture capital funds invest in young, fast-growing companies, usually for a minority stake. The job is finding great founders before everyone else, and helping them grow.
Last checked 15 November 2026
Early stage
Seed and Series A investing: judging founders, markets and products before there is much data.
Growth stage
Larger investments in companies with real revenue, where analysis looks more like private equity.
Venture capital or private equity?
| Compare | Venture capital | Private equity |
|---|---|---|
| Companies | Young, fast-growing, often loss-making | Mature, profitable businesses |
| Stake | Minority | Usually majority control |
| Debt | Little or none | A lot |
| Junior pay | Lower than private equity | Higher cash pay |
Venture returns depend heavily on a few big winners, so carried interest matters more than salary at senior levels.
A typical day in venture capital.
A realistic junior day on a normal week. Live deals, results seasons and market shocks make it longer.
- 9:00
Read sector news and new funding rounds.
- 10:00
Three calls with founders pitching their companies.
- 13:00
Market research on a sector the fund is exploring.
- 15:00
Partner meeting: discuss new opportunities and portfolio updates.
- 17:00
Write up notes on companies, and reach out to founders you want to meet.
The career ladder and pay.
| Level | Typical years | What you do | All-in pay |
|---|---|---|---|
| Analyst | 0 to 2 years | Research, sourcing companies, supporting diligence | $85k to $180k |
| Associate | 2 to 5 years | Sources deals and runs diligence | $120k to $300k |
| Principal | 5 to 8 years | Leads deals with partner support | $250k to $450k plus carry |
| Partner | 8+ years | Makes investment decisions and sits on boards | Highly variable; carry drives pay |
Approximate all-in pay (base plus bonus) in US dollars at large firms in New York in recent years. London is usually 20 to 30% lower; smaller firms and other cities pay less. Bonuses swing with the market.
How recruiting works.
There’s no standard process. Funds hire when they need someone, often through their network, so being known in the startup world matters.
Common backgrounds include banking, consulting, startups and product roles. Writing about a sector publicly, or building a list of interesting startups, is a strong way to get noticed.
Who hires.
| Type | Examples | What it’s like |
|---|---|---|
| Large multistage funds | Sequoia, Andreessen Horowitz, Accel, Index Ventures, Lightspeed | Invest from seed to late stage, globally. |
| Seed and early-stage funds | Many smaller funds in every startup hub | Small teams, lots of founder contact. |
| Corporate venture arms | Funds run by large companies such as Google, Intel and Salesforce | Invest for strategic reasons as well as returns. |
Firm names are examples, not a ranking or an endorsement.
Are you ready to apply?
Tick what you can honestly do today.
Your plan, step by step.
- 12 months before
Pick a sector
Go deep: read, use products, meet founders.
- 6 months before
Make your thinking public
Write short posts about your sector. Funds notice.
- 3 months before
Network with associates and founders
Founders often introduce people to their investors.
- Interviews
Bring ideas
Arrive with three startups you’d back and why.
Where it leads.
Startups
Many people join or found startups.
Growth equity and private equity
Especially from growth-stage funds.
Staying in venture
Partner track is slow and few people make it, but carry can be very valuable.
Myths and reality.
“Venture is mostly having coffee with founders.”
There’s a lot of research, analysis and saying no.
“You need to be a former founder.”
It helps, but many investors come from finance, consulting or product roles.
What to read.
- Venture Deals by Feld and Mendelson. Term sheets and how funding rounds work.
- The Power Law by Sebastian Mallaby. A history of venture capital.
- Fund and partner newsletters in your sector. Many top investors write publicly.
What they ask in venture capital interviews.
Less modelling, more judgement about markets, products and founders.
Judgement Pitch me a startup you’d invest in.
Explain the problem, why this team can solve it, how big the market could be, why now, and the main risk. Show you’ve used the product or spoken to customers if you can.
Basics What is a pre-money and post-money valuation?
Pre-money is the company’s value before the new investment; post-money is pre-money plus the new money. If a fund invests $5m at a $20m pre-money valuation, post-money is $25m and the fund owns 20%.
Basics Why do venture funds care so much about the biggest winners?
Most startups fail or return little. A fund’s returns usually come from a few companies that grow enormously, so each investment needs the potential to return the whole fund.
Market What’s a liquidation preference?
A right for investors to get their money back, before ordinary shareholders, if the company is sold. A 1x preference means they get their investment back first.
Fit Why venture rather than private equity?
Talk about enjoying new products and markets, working with founders, and judging potential rather than optimising mature businesses. Give an example of a company or trend you’ve followed closely.
The venture capital interview prep pack
Every interview question on this page with answers, the readiness checklist and your step-by-step plan, as a printable PDF.
Here it is.
Test yourself: venture capital
Questions from the Mandate app. Try each before you open it.
Equity value (diluted market capitalisation) is…
Share price × diluted shares outstanding. Use the market price and diluted shares. Book equity is a different, accounting number.
Enterprise value represents…
The value of the core business to all investors. It is roughly what you’d pay to buy the whole operating business, regardless of how it is financed.
Which is the basic bridge from equity value to enterprise value?
Equity value + debt − cash. Add debt and other claims such as preferred stock and non-controlling interest, then subtract cash.
Moving from equity value to enterprise value, cash is…
Subtracted. Cash is not part of the core business, and a buyer effectively gets it back.
Sharpen your valuation basics in the app.
Valuation and markets units help you talk about companies clearly.