Venture Capital/Opinion/ What is a venture partner and how do I become one? Julius Bachmann breaks down the five types of venture partners. Julius Bachmann Julius Bachmann \Venture Capital Hoxton Ventures to add a new partner in April By Amy Lewin 17 February 2023 Venture Capital/Opinion/ What is a venture partner and how do I become one? Julius Bachmann breaks down the five types of venture partners. By Julius Bachmann Monday 16 August 2021 By Julius Bachmann Monday 16 August 2021 The term ‘venture partner’ often causes confusion. As someone who’s been a venture partner at three separate firms, I often get questions about what exactly they are and how to become one. And while investment partners at VC firms usually get all the publicity, venture partners can make just as important a contribution and provide an invaluable entry point into VC. Broadly speaking, venture partners are associated professionals of a VC firm who work with limited scope. They are not full (“general”) partners. More VCs are hiring venture partners as a way to stand out, especially given the huge number of VC firms that exist now. They can be full- or part-time and work with firms over a short period of time or a number of years. Their responsibilities are just as varied; they might help out on different stages of the investment process, from sourcing all the way to supporting portfolio companies. The scope of their engagement depends on the work they do. Being a venture partner can be a path into a full-time investment role at a VC fund, especially attractive for someone with significant experience in working in the startup ecosystem but not necessarily in VC. The role can also be a way for founders or operators to put their skills and knowledge to work advising companies. It is not uncommon for fund investors to first invest their own capital into the fund and later start helping out under the title of venture partner. But before you go looking for a venture partner job, it’s important to know the five broad kinds of venture partner roles that exist and how your experience might fit into these roles. Every venture partner out there probably falls into at least two of the below buckets. They might not have these exact titles but the categories help better understand how venture capitalists think. Five types of venture partners Operating partners Operating partners help create value within the portfolio. They typically have a clear speciality, for example, growth marketing, strategic finance or product design. They work with the portfolio companies after the fund has invested and help them define go-to-market, accelerate growth or get ready for the next stage in their journey. This is an execution-oriented role for professionals who are getting their hands dirty. Gesa Miczaika, Venture Partner at Entrepreneur First: “My role as a Venture Partner at Entrepreneur First is to coach the founders and to help them on their path to acquire seed funding. I work closely with the founders and support them e.g. by pressure-testing ideas or giving them input on the intricacies of fundraising. I am thereby a part of the co-creation of every business that I mentor, helping the founders with their first steps.” Board partners Board partners also work in the portfolio companies but focus on strategy and governance work. Compared to operating partners, who often focus on a function like growth, hiring or fundraising, board partners are non-executive directors. You might also hear the acronym ‘NED’ (non-executive director) used to refer to this kind of work. Board partners are brought in for two reasons. First, funds want to bring the best board members possible into their portfolio companies. If the investment partners do not have the necessary time, they tend to delegate a board member they trust. In some European countries, funds are not allowed to send their own investment professionals into boards for regulatory reasons. Second, they may bring a special senior-level industry network that investors at the fund do not have access to. This case is especially relevant in later-stage portfolio companies. Almost all of the time, these partners work part-time with one or very few portfolio companies. Fundraising partners Fundraising partners join a VC on a limited contract while they help the partnership raise an additional fund. Very often, those partners are brought in with the hopes to access their network of fund investors. In other cases, they bring important expertise or a great fit for the next fund generation. As soon as the fund is successfully closed, they become a full general partner. Fundraising partners are not brought on fully because the fund can’t afford to bring on another partner at the time, like in the case of Albert Wegner and Union Square Ventures. Robert Gallenberger, General Partner at btov VC: “During the time we were raising the btov Industrial Technologies Fund, I worked with btov VC as a venture partner. Being a general partner in a venture fund is a long-term commitment. The venture partner period in 2016 gave both me and the btov team a flexible format to get to know each other. As we closed the Industrial Technologies Fund and started investing, I became a general partner in the fund and joined the btov partnership.” Sourcing partners Sourcing partners direct deal flow to their firm. They do not necessarily participate in the investment evaluation process but represent the fund in a specific geography or community and find great companies to introduce to the VC as potential investments. Typically, sourcing partners are well networked in the relevant community — they might be founders, operators or angel investors. Sourcing partners tend to get deal-level carry or cash compensation. This is similar to the many funds that have set up scout and angel programmes like those from Atomico and Sequoia, but not exactly the same as scouts and angels typically aren’t paid a salary. Triin Linamagi, Venture Partner at The Venture Collective: “I was one of the first hires and vice president at The Venture Collective. Due to my focus and interest in supporting more female-founded businesses, I started building my own venture at the end of 2020. With such a clear mission alignment, I decided to stay involved as a venture partner and refer the best deals I see across the US and the UK that fit within The Venture Collective’s thesis: to support underrepresented founders building transformational technology that changes the world for the better. At The Venture Collective, venture partners are a global network of founders, operators, and investors who are committed to sourcing and supporting TVC’s portfolio companies. Day to day, that means TVC is on top of my mind when I speak to new founders.” Business development partners Business development partners help funds develop awareness among a new audience. This audience can be organized around a region (for example, Nordics), a vertical (say, manufacturing), a technology (like artificial intelligence) or a community (such as creators). Developing business is then a matter of introducing the fund at industry events, connecting the general partners with key players in the local scene or educating the investment team about the key players in a new industry. Lukas André, Managing Director at Redstone Switzerland: “When I was thinking about starting a VC-as-a-Service business in Switzerland in 2016, I quickly got in touch with Redstone. We agreed that the best way to do this was to team up. But we wanted to test the market but also our cultural fit first. Venture partner was the perfect model: a mutual “venture” approach with a light structure and a clear common objective. The position as venture partner at Redstone allowed me to use Redstone’s infrastructure, track record and brand from the get-go. Once the market was validated, we were able to consolidate our presence and created the role of managing partner Switzerland.” A few dos and don’ts for aspiring venture partners DO NOT target a venture partner role as a primary source of income. The earnings potential almost never aligns with the opportunities in other roles. DO define clear outcomes for your tenure as a venture partner. Are you looking to join the fund full-time? Without clarifying this with the general partners, you might work with misaligned expectations. DO present a clear profile. Trying to cover five categories will likely result in not excelling in any of the categories, so think about where your skills can be best leveraged. If you’re a former operator, maybe you want to go for the operating partner role and work with portfolio companies. If you’re a community leader who sees a lot of interesting deal flow at the early stages, maybe you want to look for some sort of sourcing partner role. DO NOT fret about titles. The venture partner track is not formalized and can have all sorts of names. Only one of my venture partner roles actually ran under the title of ‘venture partner’. DO talk to VCs in your network about whether their fund hires and works with venture partners to get a lay of the land. Most of the time, these roles are not advertised, so it’s up to you to get your name out there and show your interest. Venture partner is a great way to learn about the VC industry and work with incredibly talented founders while having more flexibility than a full-time investment role. In the next part of this guide, I’ll outline how VCs can hire venture partners and how to align incentives. I want to thank all the contributors above as well as Ha Duong at Ocean Investment, Kirsten Connell at Octopus Ventures, Dele Akinyemi at MMC Ventures, Nikolas Samios at Proptech One and Daisy Onubogu at Backed VC for their input. Julius Bachmann is an executive coach based in Berlin working with three VC firms: Entrepreneur First, Joyance Partners and Backed VC. He began his career at Earlybird and Redstone. Related Articles The 10 fastest growing Estonian startups in the past 12 months By Mimi Billing Click here to read more Founders, don’t forget about venture debt By Donatella Callegaris Click here to read more This is where Target Global wants to invest its new €300m+ fund By Freya Pratty Click here to read more Which VCs have backed the most new unicorns in Europe this year? By Kai Nicol-Schwarz Click here to read more Most Read 1 \Healthtech Is Daniel Ek’s new body scanner worth the hype? Sifted tried it out 2 \Venture Capital VC diversity needs to change — and white men need to take responsibility 3 \Venture Capital New €3.75bn European Investment Fund pot to back late-stage VCs 4 \Sustainability Counteract closes £15m fund for carbon removal solutions 5 \Mobility Was the $5bn that VCs plugged into escooters worth it?