How to Get a Job at a Venture Studio

Venture studios hire a wide range of people. It's important to understand how they work and find the right fit for you. (#73)

As interest in venture studios increases, people are trying to understand the relevant job opportunities. In the last few weeks several people have asked me:

How do I get a job at a venture studio?

There’s a pattern emerging: People who have worked at a startup for awhile leave the role (voluntarily or otherwise) and then want to work on multiple ventures/projects simultaneously through a venture studio.

• “I like the idea of working on a few things at once.”

• “I’m not ready to go all-in on one company just yet; venture studios seem like a great way to achieve that while still working on startups.”

• “Venture studios seem like a great way to get more experience, faster.”

All fair and valid points.

The challenge with venture studios is that there’s a lot of variety. It’s hard to understand what they do, how they do it and consequently what types of people they need. In every conversation I’ve had with people about venture studios they’ve asked me the same questions:

• How do venture studios work?

• How do studios make money / how are they funded?

• What types of people do they hire?

• Is it all through their network and “who you know”?

• How do they compensate people?

• Are you expected to join a startup you help create?

• How can I tell if a studio is doing well?

These are all great questions and not easy to answer. For starters I tell them that all studios are meant to do the same thing: build and fund startups.

But:

1. All studios work a bit differently, which makes it hard to understand (and you can’t necessarily visit their websites and figure it out).

2. Other types of companies (i.e. innovation consulting business, dev shops, etc.) are calling themselves venture studios, confusing things further.

It’s tough for people to define “venture studios” as an industry because of the variety. So when deciding whether or not venture studios are a good place for you to work, you have to look at them individually.

Educate Yourself About Venture Studios

Before applying for jobs at venture studios, educate yourself about the overall market. Think of this as Venture Studio 101.

There’s plenty of content available.

I’ve written a number of articles on venture studios that you might find helpful: https://www.focusedchaos.co/t/venture-studios.

Additional content worth checking out:

• Max Pog’s interview series with venture studios

• Studio Stack by Dianna Lesage

• The Gallery by Jake Hurwitz

• Matthew Burris posts a ton of great content on LinkedIn

Despite all the variation in venture studios, if you want to work at one of them, you need to educate yourself. You’ll realize the variation makes it hard to pinpoint if you’d be a good fit or even enjoy working at a venture studio, but at least you’ll understand the basics.

Research Individual Venture Studios

From STUDIO STACK

Next, you should find a list of venture studios that you think are a good fit. There are a few key criteria you want to focus on:

• Industry / Vertical focus: More studios are focusing on narrower niches or verticals. For example, OSS Ventures only builds and funds B2B startups for factory operations. If you’re interested in or have expertise in a specific area, there’s probably a venture studio focused on the same thing.

• Corporate or Independent: Corporate venture studios are run (and typically owned) by larger companies. Working at one of these studios means you are likely an employee of the larger company (with the associated benefits and challenges). Salaries and benefits are better, but the studio will have less independence.

• How they work: This is tough to figure out without speaking to the studios themselves, but it’s important. You have to understand a studio’s methodology for validating and building startups. How much time do they spend researching ideas? How rigorous is the process pre-incorporation? What work do they do to validate an opportunity? How many ideas / startups do they work on at the same time? Etc.

What Do You Love Doing?

A lot of people romanticize the 0 to 1 phase of startup building. They love the idea of creating something from nothing, and get excited about being able to do that over and over through a venture studio.

But you know what?

It can get pretty boring. 😀

Going from 0 to 1 over and over again wears on people, especially craftspeople that want to build things. They think they’ll be building products and/or scaling them through a venture studio, but then realize that’s not always the case. It depends a great deal on how much validation work the studio does and how much support they provide once a startup is incorporated.

At Highline Beta we’ll explore dozens of ideas before finding one that we think has merit. Each of those ideas comes with similar, “rinse and repeat” work:

• Secondary research into the market (including industry trends, competition, problem spaces, etc.)

• Interview a bunch of users/customers

• Run experiments with stimuli & prototypes (i.e. landing pages, concept tests, etc.)

• Create higher fidelity prototypes to test directly with users

• More problem interviews and research

• Etc.

Imagine this as a loop, because you don’t go through this process once, find the perfect opportunity and then build a startup. You’re going through this type of early validation work over and over—in fact at Highline Beta this is the bulk of the job for our studio team.

Some people love this work.

Some people think they love this work but grow bored/tired.

We’ve had a number of very talented product managers, designers and developers work at Highline Beta and burn out after ~2 years because they spend more of their time doing repetitive validation work instead of honing their craft.

For example, designers eventually lose interest designing landing pages all day long. Heck, AI is getting good enough to do this work anyway. If you’re a product manager, you’ll lose interest because you’re not actually building product, you’re doing the painful homework before the product gets built. There’s no roadmap, no product metrics, no feature optimization work, etc.

0 to 1 technically means building minimum viable products (MVPs) and launching. A lot of people love that work, but it’s a relatively small part of what a studio does (because it’s a funnel from ~100 ideas to 1 company getting built). Often when in the build phase, there’s a founder onboard as well, and they now take charge. They may treat the venture studio as a co-founder, but they might not treat you (as an employee of the studio) as a co-founder. Suddenly you went from validating an opportunity and “owning” that part of the process to becoming a service provider for a founder/CEO. For some people that’s a tough transition.

There’s a big difference between building products and building businesses. A lot of people like the idea of building products, but are much less interested in building businesses and everything that comes with that. Studios build businesses.

Going from 0 to 1 over and over means you never get to scale or level up with the ventures you’re building. You’ll get insanely good at 0 to 1 but never have the opportunity to go from 1 to 2.

Additionally, it’s unlikely the venture studio team grows substantially, which means there’s not a lot of upward mobility. You may not be able to go from independent contributor to manager, because there’s no one to manage. If you love managing people (who do the “grunt work”) a venture studio may not be for you.

Everyone Wears Many Hats in Venture Studios

Most venture studios don’t have big teams. To be fair, I haven’t done a formal survey on this, but some quick research shows that most studios are < 50 employees (and many are in the 10-20 employee range). Funding venture studios is a challenge, and having a sustainable business model is even tougher. So studios can’t afford big teams. Many of the studios I speak with aren’t trying to grow employee headcount significantly. Lean, mean, startup creating machines is what everyone wants.

As a result, everyone wears many hats. You’ve heard this term before. Most startups use it because they’re also employee-constrained. Your front-end developer is also your designer. Your CTO is also doing the bookkeeping. Etc.

People say they love wearing many hats. If you’re joining a venture studio or early stage startup it’s the right thing to say! But do they? Really?

Some folks enjoy wearing many hats, learning new skills (outside of their core competencies) and are comfortable jumping into the unknown. But most people prefer practicing their craft, becoming experts and staying in their lanes.

The best employee for a venture studio is the “generalist specialist.” This is a Jack/Jill of all trades, with one area of expertise. You’re a product designer that also builds (through code or no code tools). You’re a developer that loves interviewing users and doing market research. And so on. If all you want to do is one thing, you’re better suited working at a bigger company where there are specialist roles.

The mentality you need as a venture studio employee is simply, “Put me in coach. You need me to do X, Y or Z? I’m not sure how to do any of those things, but what the hell, I’ll figure it out.”

Other Considerations and Recommendations for Job Seekers

Here’s a rapid fire list of other things to consider:

1. Are you joining a studio to become a founder?

This is a plausible path. Some venture studios recruit people with founder potential to see if they could eventually “spin-out” with a startup. At Highline Beta we’ve done this a couple times and it’s a great way to get to know the people.

2. How can you demonstrate your “generalist specialist” capabilities?

Side hustles. If you’re less experienced (i.e. haven’t started a company or worked at early stage startups before) you’ll struggle to differentiate yourself from other candidates. The best way to do so is to get out there and build stuff from 0 to 1. Document your journey (privately or publicly) and show potential employers that you have what it takes to figure things out, on the fly, all the time.

3. Network through portfolio companies

The best referrals will come from a studio’s portfolio. If you can work for a portfolio company, demonstrate your value and build a reputation, that’s a great way to get into a venture studio. The work could be contract/part-time or full-time. Venture studios (like VCs) love getting referrals from founders they’ve backed.

4. Venture studios may not be a long term career opportunity

Most venture studios are small. They don’t have significant hierarchy. It’s tough to move up the career ladder in a venture studio because there’s nowhere to go. The founders aren’t easily replaceable, especially if they’re GPs in a Fund structure (which typically has a 10-year lifespan). Venture studios want to stay lean and minimize “middle management.” Most don’t have aspirations to grow huge headcount where managers are required.

In a recent conversation I had with someone exploring venture studios as their next career move I said, “Think about being there for 2-3 years maximum, at which point you’ll have learned most of what you can, you’ll have done numerous sets and reps from 0 to 1, and you’ll be eager for the next challenge.”

A lot of people switch jobs every 2-3 years anyway, but if you join a venture studio you need to be more thoughtful about your career plans. Jumping from one studio to the next isn’t as easy as jumping from one big software company to another (or even one startup to another). There still aren’t that many venture studios, and they don’t have a ton of jobs.

Other logical options include:

• Starting your own company (using the venture studio experience to gain the skills and confidence to build your own startup)

• Joining a portfolio company (using the venture studio experience as a way of finding the right job in a startup that you helped create / care about)

• Joining an early-stage startup (your 0 to 1 “generalist w/ specialty” experience becomes super valuable)

• Joining a later-stage startup (you get tired of 0 to 1 and want to flex other muscles; and while your 2-3 years of 0 to 1 experience aren’t super relevant, you have great specialty skills that a later-stage startup wants, plus they know you’re incredibly gritty and perseverant)

• Joining an agency / innovation consulting business / dev shop (you might realize you love working on multiple projects at a time and don’t have to do it exclusively in a venture studio)

• Starting your own venture studio (here’s the checklist of things you’ll need to figure out)

5. Participate in the growing venture studio ecosystem

Networking & referrals remain the best way to get jobs in the “startup / investing ecosystem” (where venture studios exist as a sub-category). If you want to get a job at a venture studio, you’ll have to participate in the ecosystem through online and offline networking & events.

Thankfully there’s more stuff for you—as a job seeker—to participate in. I referenced some thought leaders earlier and there are others too:

• Sarah Anderson and Francisco Gomez from Vault Fund are leading the way in venture studio investing

• Mitchel Peterman and Shilpa Kannan wrote a book on venture studios: Venture Studios Demystified

• Sukhi Bhullar, co-founder & CEO of Skople is writing lots of great content on LinkedIn (and he’s built a venture studio & he invests in them too)

More broadly, you should be participating in the startup ecosystem. You can do this locally through events, coffee meetings, etc. to build a reputation as a doer and helper (you need to be both to succeed at a venture studio). You can do this virtually too. The more you understand how startups are built, the bigger your founder network, and the more willing you are to demonstrate a “jump into the deep end” mentality, the higher likelihood of standing out from everyone else.

6. Understand compensation

Compensation at venture studios is complicated because studios are more complex structures (than startups).

Most studios start as incorporated entities (nothing special there), but they’re positioned as holding companies with no intent to exit (unlike a startup). Studios may issue options (for future equity) to employees, but it’s tough to value those options if there’s no exit. How do you convert your options into equity and then get value from that equity? Some studios offer dividends based on the returns they generate from startups (dividends go to equity holders, not option holders).

Studios will often add venture capital funds to the mix in order to raise more capital and invest in the startups they create. VC funds have a variety of structures, but generally there are GPs (General Partners) and LPs (Limited Partners). The GPs run the fund and have upside (through “carry”) and earn management fees (typically ~2%). The LPs are the investors in the fund (and they get most of the upside). Senior employees may get some carry (but it’ll be small), and junior employees likely get no upside. You can learn more here.

So what does this mean for you?

• In a quick (non-scientific) survey of a few venture studios, it would seem that most pay under market (like startups) but with upside.

• The upside comes in a few forms, typically with options/equity in the incorporated entity (or holding company), which may provide you with dividends when the studio receives money from exits. Options/equity will vest over 3-4 years (like a startup). In some cases, there are no dividends, and the options/equity would only be valuable if there was a liquidity event (i.e. an exit of the studio, or perhaps a secondary where someone wants to buy your shares).

• Very few studios offer direct options/equity in the startups they create (although some do). The studios themselves hold this equity, but having employees on startups’ cap tables is messy. Some will carve out a portion of startups’ ESOP (employee stock option pool) for employees, but this gets complicated. At Highline Beta we created a trust that allocates trust units to employees. The trust owns equity directly in startups we create. Trust units don’t need to be purchased (i.e. options → equity) and the tax implications are better.

• Corporate venture studios operate differently. The pay will be on par with other similar jobs within the company (most big companies have very well defined “pay levels”), but there’s likely no upside. Even if a corporate venture studio spins startups out (as new, independent entities), you probably won’t get any additional compensation if/when those startups exit.

Founder-in-Residence or Entrepreneur-in-Residence Compensation

FIR or EIR compensation is handled differently. These are individuals recruited by venture studios to become founders of startups. Not surprisingly, there’s a fair bit of variation on how this is handled as well.

I spoke with a few venture studios that hire FIRs/EIRs as contractors and provide a stipend (ranging between ~$5-$10k/month). The idea is to move FIRs/EIRs into full-time roles with the new startup entities once they’re incorporated (where they’ll receive equity; although this amount will vary a great deal between studios).

FIRs/EIRs do not receive upside in the studios themselves; unless they’re first hired for a different role and then transition into becoming founders.

For more, read: How To Pick the Right Venture Studio

Bottomline: Compensation at venture studios is complicated. If you get a job offer from a venture studio make sure you understand the setup (i.e. corporate structure) and how any upside potential will work. Talk to an accountant and lawyer; there can be real tax/legal implications for how upside is handled.

10 Questions To Ask Venture Studios During a Job Interview

Here are ten important questions you can ask when interviewing with a venture studio (not an exhaustive list):

1. What industries or verticals are you focused on and why? What unique point of view or assets do you have that suggest you can win in these spaces?

2. How does your validation methodology work? How long does it typically take? What indicators / metrics are you looking for?

3. What happens if we invalidate everything we’re exploring? Some might consider that failure, but it’s an important part of the journey, right? Is compensation attached to validating things and moving them through the process?

4. How far do you go with validation before bringing in a Founder/CEO? Once the Founder/CEO is recruited, what is the working relationship like with them? Do they become our boss?

5. How many startups are you aiming to create per year? Will I be working on one startup / idea at a time or multiple?

6. Do employees typically join a startup that’s created through the venture studio? Is that ever an option?

7. What’s the potential of eventually becoming a Founder/CEO for one of the startups we create? What do you look for in FIRs/EIRs/potential founders?

8. What are my career path options? (Note: As mentioned above, I think these are limited, but it’s still worth asking.)

9. How does compensation work? (It’s always going to be tough to do real math on upside scenarios, but you can try.)

10. What’s your secret sauce for building great startups?

If you think working at a venture studio is interesting, see 👇

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To help people find jobs and venture studios find people, I’ve launched a job board. 🥳

Jobs @ Venture Studios is a job board dedicated to venture studios. Most of the roles will be for venture studios themselves, some will be for their portfolio companies. There are a bunch of jobs already posted and hopefully more to come.

If you run a venture studio that’s hiring, please post a job. It’s only $25/posting (for now).

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