Venture capital can be a very difficult field for candidates to break into. For those aiming to enter this competitive industry, working with a venture capital recruiting firm is a smart way to identify opportunities. For companies, this hiring market offers different challenges, and sifting through the many candidates to find the ones who are the right fit can be a time-consuming and frustrating process.
Keeping current with venture capital hiring trends can help both candidates and companies save time and achieve better results. With that in mind, here are some of the top trends to be aware of as we move further into 2022.
Unicorn Startups are Booming
Despite the economic upheaval of the pandemic, 2020 was a record year for venture capital investing—at least, until 2021, which quickly busted those records with $330 billion invested across more than 17,000 deals in the United States alone. Among these companies are several unicorn startups (private companies with a valuation of $1 billion or more). This trend isn’t limited to the US. Research from the UK Digital Economy Council shows startups raised £26 billion in 2021, with 29 unicorn startups created in the country in 2021.
What does this mean for hiring? As venture capital firms fund disruptive companies, the VC industry is being similarly disrupted. Companies that want to stay on the front edge of industry developments need to build teams with the skills and mindset to identify smart risks and seize growth opportunities.
Increasing Emphasis on Diversity and Inclusion
In the past, venture capital has been criticized for having a boy’s club culture, similar to many of the tech businesses they fund. This trend has been shifting over the past few years, however, and while the majority of the VC workforce is still male and white, more inroads are being created for those who don’t fit the stereotypical employee mold of old.
According to Deloitte’s VC Human Capital Survey released in March 2021, female investment professionals made up 23% of the VC workforce in 2020, increasing from only 15% in 2016. While the gains by non-white employees were smaller, representation of black, Asian, and Hispanic professionals is growing. This is likely thanks in part to the greater commitment to diversity by venture capital firms, with 50% reporting they have a team dedicated to diversity and inclusion.
Firms hiring today have an opportunity to be at the forefront of this trend and source talent from these under-represented pools. Committing to creating a truly inclusive work environment for female, LGBT, and non-white professionals can bring gains beyond a broadening of perspectives. Companies that demonstrate a genuine interest in improving internal diversity will be better positioned to work with startups with diverse leadership teams who want to work with other companies that share their values.
Employees Want a Work/Life Balance
There’s been plenty of hubub around the Great Resignation over the past year, and it’s not just noise and hype. While there are a plethora of causes behind this shift, employee culture is one of the most significant for VC professionals. As Riverside Co.’s global talent manager Adam Miller has noted, “People are willing to take less money to work in a less intense environment, and for that reason we see talent drifting to other sectors.”
Many firms have, in the past, relied on a hussle culture that demands employee overtime and gives them limited flexibility. Those using this model will increasingly struggle to fill open positions as long as this trend continues. If you want to bring in the top talent—and keep the talent you already have—that may mean rethinking your culture and employee expectations to create an environment that respects their free time and outside passions. Options like 4-day work weeks, hybrid work environments, and expanded PTO offerings are worth considering for those companies currently struggling to fill open positions.
What’s the Takeaway?
Venture capital has always been a fast-paced industry, and in the current environment trends and best practices are evolving more quickly than ever before. Tracking the industry’s hiring trends as they develop will allow you to build a stronger and more agile team capable of building your growth through 2022 and beyond.