What it's ACTUALLY like being a Venture Capitalist

I’ve been a venture capitalist for about a decade now starting off as an intern at the storied fund Kleiner Perkins, which led the earliest rounds of funding for iconic companies such as Google, Amazon, Genentech, and more.
People think of VCs as either all-knowing savants that have a crystal ball into the future of tech or as capitalist blowhards that just try to pump themselves up. Whatever you believe, one thing IS for sure, it’s a super secretive industry that has outsized influence in financing the most legendary tech companies.
Sadly, there aren’t any videos online that share what it's really like being a VC, good and bad, from inside the industry. So in this video, I’m going to share the 7 biggest secrets and surprises about being a VC in Silicon Valley

[@nogatekeepers]

What surprises you mmost about venture capital? What questions do you still have unanswered about the industry?

[@tunghuynhhuy6600]

In this current market where there are a lot of VCs out there, how do you stand out?

[@nogatekeepers]

@@tunghuynhhuy6600 There's no one right answer - some people stand out with fantastic operating experience having been there and done that in the founders' shoes, some stand out with amazingly deep industry expertise, and then there is the SignalFire approach which is to build much better platform resources / products around recruiting, GTM etc

[@sigerry5336]

You've made a great videos. Would you elaborate more details about the profit Distribution between VCs and their LPs, the 2:20 and also the profit Distribution between investors under 1 Fund.

[@nogatekeepers]

@@sigerry5336 Thanks! All the profits go back to LPs until they get their money back. Then beyond that, typically 80% of the profits go to LPs and 20% to VCs. I actually made another video explaining this here: kzbin.info/www/bejne/eWmoepuQja2sis0&ab_channel=WayneHu

[@jinghe637]

Due to the power law curves of VC, would VC devote most of their attention to the top ventures within their portfolio and ignore those mediocre or struggling companies? Another question is the follow-on investments. I heard that every find has certain reserve. Is it first-ask-first-get? So even a successful company may not get a follow-on if the other portfolio companies have used up the reserve? Thanks in advance.

[@BallyBoy95]

6:48 - showing us google's first homepage and apple's first prototype was so damn eye-opening, thanks for sharing.

[@nogatekeepers]

You're welcome.- it's crazy isn't it!

[@Galbra1th]

Wow, amazing video Wayne! Just read about the Power Law last night in Zero to One haha! So glad I found your channel so I can learn more about the VC space directly from someone crushing it in the industry!

[@nogatekeepers]

Thanks so much Cameron, very glad you find my content interesting! Will be putting out a lot more soon

[@BarrysBit]

Grandmaster Explanatory Skills per usual. Always love the clear effective communication in your content Wayne! MORE!!!

[@nogatekeepers]

Thanks so much Barry!! Absolutely - stay tuned, a lot more videos are on the way...

[@learningwithrishad]

This is a great list! I’m an angel investor slowly getting into the VC world and it’s more of a solo sport than I initially thought.

[@nogatekeepers]

Thanks Rishad! Welcome to the wacky world of VC :)

[@CesarrrScreamer]

This is an incredibly well-made video with lots of insights!

[@nogatekeepers]

Thank you Rob!!

[@joo8529]

increadibly well-made and informative, thanks!

[@nogatekeepers]

Thanks for the kind comment and glad you found it helpful!

[@sin2zz]

Really enjoy the video - such a good and thorough intro to outsiders.

[@nogatekeepers]

Thanks so much for the kind comment! Glad you thought so!

[@g-richtheproducer9513]

Wow! That’s a lot of information in this video👏🏽👏🏽

[@nogatekeepers]

Thanks! Hope you enjoyed it!

[@mahootzki5870]

Just love your videos, as a founder I find them extremely informative. Thank you! Would love to have a chat with you one day

[@nogatekeepers]

So glad you like these videos!

[@wenxuanchen4694]

The memes in the beginning were 😂Good insights/perspectives into the downsides of the buy side of the venture industry.

[@nogatekeepers]

Thanks so much, glad you liked it!

[@alexander3845]

Thanks for shedding light unto the industry for those outside of it!

[@nogatekeepers]

You bet! That’s my goal, very glad to hear it is appreciated!

[@alexander3845]

@@nogatekeepers You've definitely achieved that goal. Your channel's gonna get bigger and more popular than any YC channel or something. No doubt about it. Love the level of humility and authenticity with which you share your knowledge.

[@nogatekeepers]

@@alexander3845That's incredibly kind of you. Will keep doing my best to make better and more useful content!

[@hadeli87]

Cool video. As a founder, I sometimes think what it'd be like on the other side of the pitches. Great insight!

[@nogatekeepers]

Thanks! Glad you enjoyed it Samuel!

[@JasonGoodison]

Well made vid - cool to see a VC influencer

[@nogatekeepers]

Thank you Jason!!

[@huimingsun4228]

Thank you Wayne - learned so much from your video :)

[@nogatekeepers]

Great to hear :) thank you for watching and the kind comment!

[@EduardoTDucca]

Great video, Wayne Hu!

[@nogatekeepers]

Thank you Eduardo!

[@bzmrgonz]

I look forward to your part 2.... AFTER you leave the industry!! You know.. when you loose the fear of being fired by your bosses!! Keep me posted!!!

[@nogatekeepers]

LOL

[@bzmrgonz]

@@nogatekeepers in the meantime Wayne, could you maybe do a video on what exactly drives unscrupulous, unethical VC's to do shenanigans like, sell the land and building and turn around and rent the same assets to the company?? This is like someone putting you to perform on stage on a small rug and then sneaking up behind you and pulling that rug from under you and expect you to keep performing. Is the ROI pressure that high that VC's are forced to recoup losses by any means necessary??

[@nogatekeepers]

@@bzmrgonz Hmm I'm not sure I've seen a ton of that, although it does happen and tends to be a tier 3 VC phenomenon serving founders who unfortunately have a harder time accessing capital. I was actually planning on doing a video on why VCs behave badly, and the unique incentive structure (E.g. super long decade-plus feedback loops) that drive this

[@sigerry5336]

You've made a great videos. Would you elaborate more details about the profit Distribution between VCs and their LPs, the 2:20 and also the profit Distribution between investors under 1 Fund.

[@nogatekeepers]

Thanks! All the profits go back to LPs until they get their money back. Then beyond that, typically 80% of the profits go to LPs and 20% to VCs. I actually made another video explaining this here: kzbin.info/www/bejne/eWmoepuQja2sis0&ab_channel=WayneHu

[@sigerry5336]

@@nogatekeepers thanks!

[@nogatekeepers]

@@sigerry5336 You're welcome!

[@aminbusiness3139]

Aren’t a lot of VC’s ex-startup founders tho ? Why would a founder want to take capital from you if they feel like you haven’t been in their shoes, or have specific expertise knowledge in their companies domain industry ? What was your edge that made you valued as a VC and got you in the door ? I’d like a video on how YOU specifically became a VC. A lot of what you mentioned is Google-able knowledge so I’d love insight based on your actual personal experiences 🙂 I’d also like a vid on how you’d land a VC role in todays landscape if you were starting from scratch as a young person in 2024

[@nogatekeepers]

The crazy thing is most VCs are not ex startup founders (including the most epically successful ones).....Mike Moritz, Fred Wilson, Peter Fenton, Brad Gurley, etc.....This is a paradox I can definitely talk about in a followup vid covering the great topics you suggested. I actually already have one done on breaking into VC I will post soon!

[@proshawn13]

What would you recommend I do to start getting into this industry? I have experience in mortgages and Insurnace. What material should I study or what entry level jobs do I need to get into? Appreciate your response!

[@KitpleAustralia]

Hi Wayne, If I may ask, as a VC working at venture capital firm, who's money do you use to invest? is it your own money or the firm's money? and how does the firm regulate the amount of money each VCs spend?

[@nogatekeepers]

We invest other institutions' money, like pension funds (eg from a teacher's union) or endowments (eg from a college). We have strict controls and decision making processes in place through our Investment Committee. Thanks for the question!

[@culinaryjack]

Would you recommend getting into VC as someone who is primarily interested in having their own startup? Or would be more useful to join a startup if your end goal is to start your own?

[@nogatekeepers]

great Q - if you don't have any specific passion area/expertise/idea, I think not a bad idea to join vc to give yourself a broader aperture. otherwise, I recommend just jumping in the deep end if you have conviction (but then again, why would you need to ask me then;)

[@kristiandilov5249]

This may be a personal quetion, but what got you to enter VC instead of PE or HF?

[@nogatekeepers]

I love the entrepreneur's journey to do the impossible without any resources out of the gates - it appeals to my immigrant background seeing my parents move to the US from a rural farming village without much money. I also believe in technology as a potential transformational force for good, and to increase the collective level of empathy in the world, which is my personal mission

[@sahistasheikh5184]

Though i found vc job so cool that I want to start doing it but I am not from finance background rather a medical one. I am just in the catch of cool job to get some extra money though i am very keen to learn a new skill should i go for it I am currently 19 and thinking of taking beginner course of vc should I go for it tell me from your experience senior?

[@nogatekeepers]

Yeah I think best to try to break into tech (where there are tons more jobs) first before trying to get into vc

[@tushardhanwani2150]

Hi Wayne! It's really an insightful video. I just have one year of work experience as a PMO, and currently, I'm considering getting into VC. So, can you share more information on how can one get started working in VC/as VC?

[@nogatekeepers]

Thanks Tushar! Yes this is actually a video idea I was thinking about for Awhile, I’ll try to do it sometime this summer :)

[@user-wr4yl7tx3w]

It really is a sales job but should it be...

[@nogatekeepers]

Good point - part of why it may be so Sales heavy is because it’s so competitive, which is good for founders but also a symptom of a m artificially low interest rate environment that arguably saw too much capital slosh into venture

[@dailydose273]

The reason why there is no one really talking about AG/VC/PEs is because they can't say any specific examples or details. But without it just makes them look like associates. It's a self-sealing dirty industry :-)

[@rockysalvi5548]

What is the best way to reach out to you directly!?

[@nogatekeepers]

Hey Rocky - thanks for reaching out! If you've got a question, feel free to post here. I'm on LinkedIn but to be honest, it's pretty inundated with spam messages so stuff there falls through the cracks

[@rockysalvi5548]

@@nogatekeepersI have been watching your videos and learning as much as I can from the content. Not a pro yet, however taking baby steps in comprehending the whole process. I am looking to assist my client get a venture funding done for their business. Wanted to reach out to check if it's something you and other general partners at Signalfire would be interested in venturing into. I have reached out to you on LinkedIn yesterday. I know it may be an hassle going through the spam, but if we could connect and discuss over the scenario, and see if that's something we can work on.

[@gregkosinski2303]

This guy is a VC alright

[@dailydose273]

VCs PRETEND to be coaches, not VCs ARE coached.

[@snowyy.5275]

0:18 I was very confused when you said a decade. You look like you graduated high school yesterday. Tell me your skincare routine

[@nogatekeepers]

LOL - did about a decade of work before venture. I'm OLD

[@danf4447]

whats with the hair? and im so tired of tech bros in 4 dollar t shirts. i guess im old.

[@nogatekeepers]

Lol fashion isn’t my strong suit. Neither is hair, although my wife seems to like it so I guess that’s good enough!

[@dallaschrystian8651]

Who gives a shit Boomer. This man is doing amazing work and he’s brilliant. He won’t say it but I will. Fuck off and stay focused.