The venture interview: what they actually ask you to do

The venture interview does not look like other interviews, and the reason is worth understanding before you prepare for it.

A firm hiring an investor is trying to answer one question: can this person be trusted with judgment. Not can they work hard, not do they know the vocabulary. Judgment. Everything in the process is an attempt to observe it, which is why so much of it takes the form of asking you to actually do the job.

Expect four things, usually in this order.

1. The screen

Thirty minutes, often with whoever runs talent or with the most junior investor.

They are checking three things: that you can hold a conversation about the market, that you have a reason for wanting this fund rather than any fund, and that you are not going to be difficult. The second one is where most people lose it. If your answer to why us would work for any of forty other firms, that is the answer they hear.

Come with a view about their thesis, and preferably a mild disagreement with it. A candidate who says "your last three investments suggest you believe X, and I think the risk in that is Y" has demonstrated more in twenty seconds than a page of enthusiasm.

2. The exercise

This is the centre of the process, and it takes one of four shapes.

Evaluate a company and recommend. The most common at early stage firms. You get a deck, sometimes a real one from their pipeline, and you come back with a decision. As Mergers and Inquisitions↗ sets out, what is being assessed is whether the company could deliver the return multiple the fund needs at that stage, on the order of 100x at seed or 10x at Series A. Everything else is subordinate to that.

A market map. Pick a sector, map who is in it, say where you would invest and why. This tests structure and taste at once.

A sourcing exercise. Find five companies we should meet. This is the purest test in venture recruiting, because it measures the only thing an associate is genuinely hired to do. It is also the one you can prepare for months in advance, and almost nobody does.

A cap table exercise. Ownership through successive rounds, dilution, pro rata. More common at growth funds and anywhere the diligence is quantitative.

What the exercise is actually measuring

Three things, and only one of them is analysis.

Do you decide. A recommendation with a caveat is a recommendation. A survey of considerations is not. Say yes or no in the first paragraph.

Do you know what would change your mind. The strongest answers name the two facts that would flip the decision and say how to find them. That is what a real memo does, and it signals you understand that investing is done under uncertainty rather than resolved before it.

Is your market view plausible. The classic failure is assuming the company captures the whole market. Realistic penetration is a fraction of the addressable number, and an analysis that quietly assumes otherwise reads as inexperience regardless of how tidy the model is.

Two more practical notes. Keep it short: two pages that decide beats ten that survey. And if you cannot find a number, say so and say what you would do about it, rather than inventing one. Firms notice which candidates guess.

3. The partner conversations

Two or three, usually unstructured, and often not obviously an interview at all.

What is being tested is whether they want to argue with you every Monday for three years. Leslie Crowe↗ of Bain Capital Ventures names the thing she watches for: she sees a lot of people fold, and the business is about being comfortable standing behind the things you are passionate about.

That is the single most useful sentence about venture interviews in print. When a partner pushes back on your recommendation, they are usually not correcting you. They are checking whether you hold. Update if they have given you new information, and hold if they have not.

Have a real answer to what you would invest in that we would not. It gets asked constantly and vague answers are fatal.

4. References, including some you did not give

Venture is small and reference checks are informal, continuous and often backchannelled. If you have worked with founders, expect the firm to talk to them, whether or not you offered their names.

This cuts in your favour more often than people assume. Being known as useful by founders is the strongest signal in the industry, and it is one you build years before you need it rather than during a process.

How long it takes, and why silence is not a verdict

There is no calendar. Venture recruiting is off-cycle and unstructured, closer to off-cycle private equity than to anything with a season. A process can close in a month if someone has just left, or drift for a quarter if nobody is under pressure.

Slow does not mean no. It usually means the partner who wanted to hire has been travelling.

And the base rates are worth knowing so you read your own results correctly. Funds report well over 500 applicants for a single posted role, according to Tunde Adekeye↗, who landed a fund role after three years, more than thirty interview processes, two internships and three international moves. Sajith Pai↗ of Blume Ventures puts the arithmetic plainly: venture teams are small, there are always more candidates than roles, and it is one of the harder segments to break into.

Thirty processes is not evidence that you are doing it wrong. It is roughly what the arithmetic produces.

What to prepare, in order of value

1. Five companies you would invest in, with reasons. Live and current. This survives contact with every format of exercise and every partner conversation.
2. One view about their sector that they might disagree with.
3. A worked example of your own judgment. An angel cheque, a scout referral, a market map you published, a company you called early. Anything that demonstrates rather than asserts.
4. The vocabulary. Fees, MOIC, carry, dilution, pro rata, ownership targets. Enough not to stumble.
5. Your honest answer to why venture pays less than what you do now.

Related

What each level on the investing track actually does, or what carry is worth before you sign. If you are still looking for the process to start, see who is hiring this week.