According to dependable sources, some of America’s most successful venture capital firms have been finding it difficult to recruit people to lead their new European outposts.
U.S. Venture Capital (VC) heavyweights including Sequoia Capital, Bessemer Venture Partners, Lightspeed Venture Partners and General Atlantic have all either opened new European offices or started notable expansions in the last 12 months.
Sources say huge U.S. VC firms are finding it is extremely challenging to recruit the ideal people in Europe, adding that there have just been a small bunch of prominent appointments.
U.S. VCs would in general zero in on growth while European VCs were bound to focus on reducing or eliminating risks. There is monstrous rivalry between U.S. VCs and firms like SoftBank, which has its Vision Fund settled in London.
According to one capitalist and founder Kanji, U.S. VC firms need to hire tech investors that they’ve worked with before on start-up boards. In fact, they generally don’t like hiring strangers.
Other venture capitalists, say the “profile of VC” that many of the U.S. funds like is less commonly found within the European space
They added that,
“It’s not that the talent doesn’t exist, because it clearly does, it’s that the pool of candidates folks are targeting is just more narrow.
The source said top investors don’t “just tick the box and spend two years at a start-up after the pre-MBA program at McKinsey or Goldman before getting their MBA at Harvard and becoming a VC.”
In March 2021, Menlo Park, California-headquartered Sequoia hired Luciana Lixandru from Accel to be its first partner in Europe. Accel, which has an office in Palo Alto, California, has backed several companies in Sequoia’s portfolio including Dropbox and Qualtrics.
Also Sequoia made a unimaginable showing of recruiting Luciana, particularly when there aren’t numerous VCs in Europe with a “growth-oriented mindset. The truth of the matter is, it’s difficult to track down that capability in Europe these days, and that is what the U.S. reserves are figuring it out. So Luciana coming on board was a surprisingly beneficial development.
Other than Luciana, there is additionally Paul Murphy- – who led Northzone’s interest in virtual event startup Hopin, which was most as of late esteemed at $7.75 billion notwithstanding being under 2 years of age.
Luciana and Murphy are the main two remarkable recruits in Europe by U.S. VC firms, who left San Francisco VC firm IVP this late spring to join London-based Blossom Capital as managing partner recently.
Interestingly, when the right candidate does come along in Europe, U.S. VCs are willing to pay big premiums. A tech investor at a U.S. VC firm with a London outpost is probably on around $1.5 million a year.
The venture capital industry is relatively new in Europe compared with the U.S., where the scene has evolved since the early days of the internet.
That said, Europe’s VC industry has grown substantially in recent years. A decade ago, there were only a handful of venture capital funds in Europe and around 100 tech investors. Fast forward to today and there are thousands of VC professionals in Europe but a large number of those have only been VCs for a few years.
Meanwhile, the fact is that, people who come from operating roles will need some training, and many of the U.S. VC firms will be looking for people who can be “instantly successful.”