Some companies don’t need external money to get started. Many need Venture Capital to get started - and VC’s like investing in things that they know.
This is a blog post in a series of articles about getting a job in tech. Confused? Here’s the first post
Let’s take a step back here
Many people who are new to the tech world dont even know what venture capital is. I think this is important to know - venture money is how many of the companies we use today came into existence. (Yes, even Facebook.)
Venture is a vast expanse, containing lots of abbreviations, lingo, dynamics, and more. It’s not critical to learn about in tech, but can definitely give you an advantage when it comes to understanding tech businesses.
The Basic Gist of What is Venture Capital
Venture capital is the redistribution of high net worth individual’s wealth into companies in exchange for a percent of ownership of the company, with the goal of profiting via company growth.
Venture capitalists are the people who go out looking for deals to invest in, making sure the companies are good investments, helping the companies, and also talking to the high network individuals to convince them to let them invest their money.
A venture fund is a company of people who’s entire job is to be venture capitalists and help their investments flourish.
This is a very extreme summary of what venture capitalism is. If you’re interested in learning more, I’d recommend checking out this guide by my friend Paige Doherty about getting into venture capital.
Why is venture capital important to you, as a job seeker?
Venture Capital is a critical part of the tech ecosystem. Most the companies you love today wouldn’t exist without some sort of backing via venture. You can also use investors as a metric for a company’s potential and stability. If you see that a group has invested in companies that you respect (which you can learn via the venture firm’s portfolio usually found on their website, or by looking on crunchbase.com), you can expect they’ve found similar exciting traits in the rest of their companies. You can also use venture funds as a way to find new companies.
Beyond giving money, venture funds also love helping people, which is why many of them have their own job boards for their investments. Here’s a couple I’d recommend looking through:
In this article, I’ve given you great ways to find companies, as well as tips for executing due diligence (research and evaluation) of potential employers. One more tool I recommend checking out for researching a company is Crunchbase. Crunchbase keeps track of public information about a company, like estimated number of employees, estimated amount of funding, recent news and articles about the company, and more.
This is useful to understand the dynamics of the company and it’s potential growth.