So, you've done the hard part. Leveraging your skills to be a top prospective analyst or associate at a venture capital firm is a sign that you are more than qualified to take on the role. Even as recent bank failures shook the confidence of many in Silicon Valley, VCs still are some of the highest paid professionals in finance and tech. Yet even the most standout employees in any industry can be daunted by talking salary. However, it’s always helpful to be armed with information about what others in your role are making to give you leverage—and to ensure you’re not asking for wildly more than the going rate, nor getting lowballed.
A key thing to know about compensation at venture firms is that it is not uniform. “I have people applying to our programs from all over the world—and I think that has highlighted to me that actually entry level roles really vary,” says Eleanor Kaye, who runs a next-generation investor training center in London called Newton Venture Program.
The best policy is to ask people who work at the funds you are applying to. However, here are some industrywide resources and data points that can help:
- The Emerging Venture Capitalists Association, a community for early-career investors, publishes an annual compensation survey, which you can find here. For example, the median total compensation for an analyst at an institutional VC in 2022 was $119,000.
- John Gannon publishes an annual salary survey here. Based on the most recent edition, analysts make an average of $92,000 base salary a year, and associates make an average of $137,000.
Meera Clark, a principal at Redpoint Ventures, points out that “compensation varies dramatically based on AUM.” If you’re working at a multibillion-dollar growth fund versus a seed fund, the pay is going to look different.
Compensation is also related to how much the top partner's at the firm are making from their funds. “It’s important to understand how VCs make money when you’re going in for the negotiation discussion,” because “VCs make 2% of the fund size as management fees, which is how they basically pay their employees,” Nicole DeTommaso, a senior associate at New York–based Harlem Capital says.
A savvy way to bring up the compensation topic is to ask partners at a firm to lay out how their compensation structure works, why it’s set up that way, and how a fund employee can earn more, says Lionel Foster, who was hired as an investor at real estate technology firm Camber Creek in 2021.
While it is important to understand the pay structure of anywhere you are working, the compensation conversation might not actually be much of a conversation at all. In fact, some top firms don’t allow for negotiations. Leslie Crowe, a partner who heads up the people functions at Bain Capital Ventures, says Bain offers associates the same rate across the board. “We’re very sensitive to not wanting the best negotiator to win,” she says. Bain Capital Ventures pays $175,000 base salary and $125,000 bonus for an associate, and it also allow employees to coinvest in their funds, Crowe says.
Networking is the name of the game
Once you have your foot in the door at a firm, you have to prove you are a worthwhile investment for the firm. DeTommaso says to try to go to any and all industry events you can—happy hours, dinners—once a week to build connections.
Crowe adds that Bain Capital Ventures tells hires that this is your “say yes to everything” time. “Go to all the calls, shadow all the things. A lot of this business is also just getting exposure.”
Redpoint’s Clark says one of her general partners gave her a crucial piece of advice: “If you invest in one thing, and one thing only, in your first six months, it should be your network.” For Clark, that meant getting to know people senior and junior to her, and also doing cold outreach to other investors in her space (consumer investing). She would “just email them, and like, 90% of the time, they would respond and say, ‘Hey, yeah, let’s get coffee.’” That kind of networking is also easier (or more common) for analysts and associates to do versus when you’re higher up in the ranks, she says.
Insiders also emphasized that it's important to have a go-getter attitude, and be ready to jump in with ideas and volunteer for assignments––whether that be tweaking financials or compiling sourcing lists.
But if you’re not sourcing loads of deals in your first month, “be easy on yourself,” DeTommaso says. “It’s hard, right? So you might not get a deal through for some time, and that’s okay. You can be a part of the conversation and you can be learning.”
If you want to know everything there is about getting a job in venture capital, read our full guide.
