How I Got Here: Episode #11
How to Break into Venture Capital from College
with Aditya Nidmarti, Weinberg ’20
Investor @ Bessemer Venture Partners
Aditya Nidmarti, Investor, Bessemer Venture Partners. Aditya was an international student from India who was looking for any internship that would allow him to stay in the U.S. after his freshman year. After landing an internship at a local startup, SpotHero, while the company was raising a financing round of venture capital, Aditya became intrigued by the industry, and started a venture capital club at his university. Founding the venture capital club allowed Aditya to reach out and build relationships with investors in the industry, which ultimately helped him land an investor role at Bessemer Venture Partners after graduation. Aditya discusses the difference between private equity and venture capital, why he believes in cold emailing people, and advice for pitching investors. This conversation is brought to you by The Garage at Northwestern.
“…on a daily basis, I felt that my personality suited the venture capital job more than the consulting job. I love meeting new people.”
“…if there’s a need, [a company will] see that you will be a great addition to the team, they can make a rule suited just for you. And you can only get those roles if you have an outbound model of reaching out to these people.”
“Instead of you asking for a favor from the person you’re reaching out to, if you provide value upfront, they’ll be more inclined to even have a conversation with you. And cold outreach goes a long way. You can build great relationships with that and make great friends, even land jobs for that.”
“I think first and foremost, what is required is intellectual curiosity. Finding new companies, meeting new founders can get monotonous, but intellectual curiosity is a trait helps some people get the job done more easily than others.”
Welcome to How I Got Here, a podcast from The Garage at Northwestern, exploring interesting journeys of young professionals working at exciting companies, and the role that entrepreneurship played in getting them there. My name is Mike Raab, and I love dissecting nonlinear and non-traditional career paths, and the lessons that we can all take away from those who forged them.
On this episode I’m joined by Aditya Nidmarti, an investor at Bessemer Venture Partners in New York. Aditya moved to the US from India for college, breaking a lineage of three generations of doctors before him. While interning at a startup over the summer, Aditya was exposed to the concept of venture capital and quickly became enamored with it, which led him to start a venture capital club at his university and ultimately land a role in venture after graduation. In this episode, we discuss the benefits of cold emailing, why venture capital is, “arming the rebels,” and Aditya’s advice for entrepreneurs pitching investors. I hope you enjoy this conversation with the Aditya Nidmarti.
All right Aditya, thank you so much for being here with us today.
Thanks for having me, really excited to be here.
We’re excited to have you. So I thought a good place to start would be, you were actually born and raised in India and came to the United States for college. What drove that decision to come to the US, and did you know what you wanted to study at the time of making that decision?
Yeah, good question. So just for context, I was born and raised in India, spent 18 years of my life there and then made the decision to come over to the US, especially Northwestern to further continue my studies. But going back to my childhood days, my entire family is filled with doctors. So a fun fact is that the last four generations of my family members have been doctors. And obviously when you grew up in that family environment, there’s some sort of lingering thought that, “Hey, I might too become a doctor,” and you sort of grew up with that feeling. And I too as growing up with that feeling, and without even me deciding subconsciously, I decided that, “Hey, maybe the medicine path is a good way forward.”
And sort of just leaned into that in my junior year of high school, and realized that this is not working out. Although the junior year is not too late, it is too late if you want to apply to the US. But we still made things happen and decided that liberal arts would be the right way forward, given that I haven’t decided what I want to do. And obviously you can go to the US, see and pick up subjects you want, and then decide that, “Hey, maybe this is the right way forward.” So just by the virtue of being undecided, I felt that the liberal arts education would be the right way forward. And the US obviously is the number one place to go pursue that.
Was that a difficult conversation to have with your family, when you were telling them that you maybe didn’t want to be a doctor, in following the family footsteps?
It was difficult in the sense that obviously my parents would not be too happy with that, just because they’ve been doctors, they see their child becoming a doctor. but it was easy to convince them that maybe that’s not the right thing, but I do have a secondary plan in my mind. And that’s been a key trait that I have developed over time. Whenever there’s a problem, it’s always important to come up with your solution or your first stab at it and present that along with what the problem is. And we can come back to this later on, but that’s one of the key things I try and do while problem solving.
So you end up coming to Northwestern and studying economics, I believe. What made you choose econ, and what was your vision at that point of what you wanted to do after school? If you had one.
Yeah, good question. So the first thing I did when I came to Northwestern was decided to take an econ class, and somewhat fell in love with it. I never came in with the thought of doing econ. I came in undecided, decided to do econ 201, which is what everyone takes the first quarter if you have some sort of inclination towards econ. And that happened to be a macro class, we happened to learn why the government can’t just print money. And I’m like, “Okay, the first class gave me the answer to the biggest question I had, and this is interesting.” So just went with that gut feeling and it happened to work out.
I love that. And so you decide to major in econ, looking towards your first summer, typically students will take an internship in banking or consulting or something like that. What was your kind of internship search process like and where did you land?
Good question. So my biggest thing in my freshman year was that I did not want to go back home to India for the entire summer break. And it did not matter what sort of internship it was, it did not matter if it was consulting, banking, startups. I just wanted that one internship to understand how work does happen in the US and for that matter, how I’m supposed to be present in the workforce. And that led me to my internship search. I interned at a company called SpotHero, which is a startup in Chicago. It’s pretty big now it’s a series D startup, I believe. And it was a sales operations internship, basically trying to [inaudible 00:05:03] the supply side of SpotHero, which is a marketplace. And it was a big learning experience.
It was my first job of sorts, and it happened to be at a pretty high code startup, so it was extremely hands-on. And the interesting part about that internship was that it was project based, it was not task-based. So when I came in, they’re like, “This is the project you have for the entire internship, and you are responsible from going from A to Z for that project.” And that gave me a perspective in how project based work happens, because it’s not like my manager comes in every day and says, “Hey Aditya, this is what you have to do for the day.” It’s like, “This is what you have to do within three months, And you can figure out your entire path from A to Z.” And it was extremely enlightening in many ways.
All right, so you have this project-based experience at, as you mentioned, kind of a fast growing startup. What were your takeaways from summer as far as, I’m sure you learned a lot about product management, and time management and prioritization. And it sounds like you went back the following summer as well. What did you learn and what excited you to return the next summer as well?
Yeah, good question. So my learnings can be bucketed into many different areas. So let’s start with the first and foremost, which I believe is the most important thing, as in when students enter any new internship as a student. We have a pretty broad idea about things. We specifically don’t know how things at companies work, because every company has a different way of doing things, different processes in place. So the number one thing for me, as in when I enter any sort of new working environment, is asking the right questions. Getting the context of where you are, what you’re supposed to be doing, and what everyone is doing is extremely important. So asking as many questions as possible without having the lingering fear of being stupid or coming across as stupid is extremely important. This could be as basic as, “What is the email etiquette here?” Or, “What is the lunch etiquette here?” Or, “How is this supposed to be handed over to a different team?”
Just getting the context in the first week or so is extremely important, so you can set yourself up for success, which is what everyone wants. You want, the team wants, the company wants. Secondly, I think what is important is networking within the company. There can be a lot of times where companies are structured in silos and people in different silos don’t know what you are doing, or what is the context in which you’re operating, which leads to some sort of hiccups. I’ve been in situations where I’ve been doing stuff the way I’m supposed to be doing the project or whatever it is, but people in different parts of the organization do not understand that and sort of questioned me. So link context with them is also important, but also understanding their stories, how they’ve come here, what they’re up to is important as well. So networking within the company is important and it helps you understand what other people are doing, but also gives them context on things as to what you’re up to.
And totally, I feel that everyone needs to have a perspective on what they want to achieve. And this is like a broad statement, but this boils down in many different things that people can do. It boils down to you having a to-do list, it boils down to you having a goals list. That can be short-term goals, that can be longterm, what you want to achieve from the internship. And at every interval sort of coming back to this and seeing how you’re treading along with that. And even making that extremely vocal with people you’re working with. Either it’s a manager, either it’s other interns you’re working with. So that everyone just has an idea about how things are going and they can come in and step in to help you if things are not going right.
So I think those are the few basic areas I’d focus on when students are entering new internships or jobs. And obviously as things progress, things become more nuanced, you can dive deeper into these fields, but to start off with a belief. Networking, asking the right questions and gaining context, and also having goals set for yourself is important.
That’s great advice, and if I could boil it down to two words, speak up. You will learn a lot less if you don’t ask questions and just keep your head down, but also people can’t help you and help you develop the skills or achieve the things you want to achieve if they don’t know about it, if you don’t tell them. So I think that’s great advice.
And at some point during one of your summers here, SpotHero actually was raising around a venture capital, which kind of exposed you to the venture industry for the first time. What was that kind of experience like, seeing that happen around you and what excited you about a venture?
Yeah, obviously I had heard the word venture capital being thrown around a bunch of times before I joined SpotHero. Never actually knew what that meant. And there happened to be one time during my first internship at SpotHero where the word venture capital was being turned around by the CEO, by a few members of the senior management, and that rung a bed in my head. I’m like, “Okay, I’ve heard this term being thrown around so many times. I just have to understand what it means.” So went and spoke to my manager, went and spoke to a bunch of people and they’re like, “It’s no big deal, we’re just raising a round of financing, and the way we call it in our lingo is venture financing or venture capital.” I’m like, “Okay, that’s interesting. How does this work?” And that led me to understand the fact that startups require money to function. Obviously, you need capital to build a product, you’re building to sell to different customers, you intend to sell, to spend on marketing, spend on sales, so on and so forth.
And the exact terminology used to fund these startups is called venture capital. It’s the same thing as selling stocks and getting money and using that money for operations, obviously venture companies are small, startups are small, they’re extremely early. So instead of selling stocks on the public market, you go and sell them in the private market and that’s called venture capital. So, understood that, and realized that I really want to know more about this field. I’m extremely interested in this field. And obviously as a freshmen, the place you can learn this is university. So I went back to Northwestern to understand what sort of resources are there on campus to help me educate myself on venture capital and realized that absolutely seal resources on campus. And spoke to a bunch of my friends who were interested in the same space, and came up with this plan that we did not know much about venture capital. Probably there are students like ourselves who do not know much about venture capital and are interested in learning more.
So we created this, I don’t want to call it a club, but it was a club back then. It is a club still today, but it’s mainly a learning group where like-minded people like ourselves came in and decided to teach ourselves what venture capital was by using resources that were outside of campus. And that led to the formation of a club that’s still present on campus called Rock Venture Capital, and some other students are running it now. But the premise is that people want to learn about venture capital. Obviously you can learn about venture capital through internships, but to get that internship you have to have some context about what the industry is. And here we have students teaching other students about VC. We have some VCs externally who will come and give you ad hoc projects, so you can get real life experience while you’re in school and not even doing an internship. Just by the virtue of you working directly with them. And that was the idea that came out of me just being curious about the word venture capital, and then everything just fell in place after that.
How entrepreneurial of you to identify something you wish existed in the world, realize it doesn’t and build it yourself.
And so I also imagine that starting a student group based on venture capital gave you a good excuse to reach out to a bunch of investors or those in the venture capital industry to just take advantage of starting to build relationships with them. Was that the case?
That happened to be a byproduct of what we did. So let me walk you through the process. We realized that for us to gain knowledge about venture capital, obviously you could go on the internet and read about it, but the real experience or the real education will only come when you have exposure to these venture capitalists who are doing the work in real life. So we came up with this plan of reaching out to venture capitalists and offering them our services for free. Us students could do ad hoc projects for them. Obviously venture capital firms are pretty tightly staffed and they have a lot of different things that are going around and you prioritize based on what the work is.
Investing in companies obviously is number one, but doing like a market map is not number one. And we as students could do that and in return we could get real life exposure with these VCs. So that was the premise of reaching out to maybe 500 VCs in the US, and a byproduct of that was just me building good relationships with a few of them, including my present employer. And it just so happened that we reached out to a bunch of VCs, some of them liked the idea, obviously it boils down to only a few agreeing to work with you. And we did happen to work with some great VCs. It just naturally piled up and relationships were built through that process.
Yeah, we’ll get to it in a bit, I think, when we talk about your current role, but doing free work or providing value upfront, I think is a theme that comes back. And so I believe by your junior year, after two years of interning at SpotHero over the summer, you had actually applied to intern at your current employer, Bessemer Venture Partners, but didn’t end up getting it. Is that right?
That is right. So I applied to Bessemer Venture Partners as a junior for the summer analyst position, which will happen in the summer of my junior year. And unfortunately didn’t make it at that round. I still have that rejection email sent by one of my ex colleagues to me, and then the process began about what to do that particular summer. Obviously being an econ student, consulting is a great option. Obviously consulting was something I was interested in as well, along with venture capital. I didn’t have all my eggs in one basket. I was just looking at different areas of industries as well, and went and recruited for consulting. Ended up working at McKinsey my junior summer. It was a great experience as well, we can dive into that as well when whenever is right.
Yeah, I’d love to dive into it now, but I hope you have that rejection email framed at your desk at work. What about working in consulting didn’t resonate with you wanting to do it longterm?
Yeah. So, for context went and worked at McKinsey in the Chicago office in the junior year summer, which was summer of 2019. All in all, consulting was a great experience. I mean, it lent me an eye into the greatest industries of the world and how stuff is being done internally in those industries. But also how consulting work happens to be there and aid those industries as well. And the positives of consulting were that obviously you built great relationships with people, the smartest people obviously in the world, trying to solve the biggest problems. But at a fundamental level, what I saw was that consulting was trying to help the incumbent stay relevant. So for the most part, consulting companies have clients that are old, in other words, they’re called incumbents and they’re having problems that are coming up due to competition, coming up from new entrants, profits not being there, so on and so forth.
So at a very fundamental level, consulting is helping incumbents stay relevant. And on the other hand, you have venture capital, which is helping newer entrants come in and beat these incumbents. And that’s why these incumbents come to consulting companies and ask them for their services. And when I took a step back and said, “Okay, which side do I want to be on? Do I want to be in the side of the incumbents? Or do I want to be on the sides of the new entrants who are trying to beat these incumbents?” Obviously these new entrance will become incumbents in the future, inevitably, but for the moment you probably want to be with the incumbents or do you want to be with the new entrance?
And the answer was clear for me. I really wanted to work with the new entrants. And that’s a philosophical answer, but on a daily basis, I felt that my personality suited the venture capital job more than the consulting job. I love meeting new people. So for example, in VC I’m meeting on an average two new people a day. Net new people, I haven’t met these people ever, and I’m just building a relationship with them and seeing how I can best help them. And we can get into that later as well. But that fundamental belief of working with the newer entrants sort of persuaded me towards leading a career in venture capital.
I like that perspective, it’s like the old guard, or army and the rebels?
One of those sounds like a lot more fun, especially as a college student. So you’ve had these experiences at SpotHero and startups as well as at McKinsey, and have also started the venture capital club at Northwestern. So what did your job search look like starting fall of your senior year? Typically people are doing formal recruitment, getting offers in the fall quarter, again, to work in consulting or banking, what was your process like?
Yeah, so my process was slightly different given the fact that I had experience in startups my freshman and my sophomore year, I also had experience in consulting my junior year. So when it came to my senior year job search, I was extremely specific about what I wanted and what that was going to look like. So it did not entail me going for a bunch of info sessions on campus. It did not entail me randomly applying for jobs. I see that being a process for some students who are still not sure about what they want to pursue, but for someone who had that experience in summers prior to this recruitment cycle, I was pretty sure about what I wanted to pursue. Either it would be joining a startup on an operating role, or it would be working at a venture capital firm trying to find great startups. Coming back to the earlier question, I always wanted to be on the side of the rebels, which is the startup ecosystem. So either being a startup internally or help find these great startups.
And that was the process I had nitpicked the industry I wanted to be in. And it just included reaching out to people, like an outbound style of recruiting because many times what I’ve realized is that smaller companies, like venture capital firms or startups, don’t formally post job postings. But if there’s a need, if they see that you will be a great addition to the team, they can make a rule suited just for you. And you can only get those roles if you have like an outbound model of reaching out to these people. So one part of my strategy was doing that. The other part was obviously looking for job openings within these industries and then doing whatever is necessary, applying, doing the take-home assignments, networking, so on and so forth. And for that process, again, reached out to Bessemer Venture Partners who had rejected me previously and had built some good relationships steps with that process as well. So, that process went pretty smoothly from me applying to getting the job.
Yeah, I think it highlights a lot of traits or characteristics of you. One that you’re not afraid to reach out cold to people, which is obviously important in venture. Also that you’re not embarrassed to reach back out to someone that has previously turned you down. And it sounds like you are a very much a people person and that you like meeting new people all the time and building relationships and that basically all your experiences had come to a head to land you this role out of school.
Yeah. And I just want to double click on the fact that cold reach out when recruiting is one of the most tightly kept secrets of sorts when it comes to recruiting. I think a well detailed cold outreach email is one of the strongest weapon students have as a student. So I can elaborate more on this.
I’ve used that tactic way too many times in my career. Whether it’s for recruiting people, whether it’s for helping the VC club grow, whether it’s for me landing a job. I think the most important part about call outreach is providing value from the first email itself. So when people reach out to me saying, “Hey, what’s the cold outreach process for venture capital?” I’ll always tell them, “Along with cold outreach, also provide two or three companies that might be worthwhile investment opportunities for that particular VC you’re reaching out.” So it’s like providing value from the first email itself. Instead of you asking for a favor from the person you’re reaching out to, if you provide value upfront, they’ll be more inclined to even have a conversation with you. And cold outreach goes a long way. You can build great relationships with that and make great friends, even land jobs for that.
Right. And not to embarrass you, but we’re having this conversation because of a cold email you sent about the first season of the podcast, giving us some feedback and input, which we appreciated.
And so, okay. We’ve mentioned providing value up front a couple of times as a rather important and good skill to have. Could you walk us through what the day-to-day of your work as a junior VC is like?
Absolutely. So my role as a junior VC has two or three functions to it. It starts off with primarily two functions, which is called sourcing on one end and due diligence on the other end. And as you progress through the job, there’s a third element that comes in, which I’ll come to later. But starting off with sourcing, sourcing at it’s core is finding and meeting with new companies. It is building relationships with founders, understanding from them what the company is about. And then building a list of companies that are exciting and interesting for your fund and following up with them leading up to an investment. So it’s right from finding the company to being part of the process to invest in the company, but also maintaining that relationship once you’ve invested in that company. And that comes in the sourcing part of it. The other part of it is called due diligence.
So once you’ve identified a company that might be worth an investment, you work backwards on your thesis. So you come to the table saying, “Hey, we really want to invest in this company. Let’s do the work to confirm that hypothesis, that this is a good company.” So it includes reading through the financial statements. It includes doing some due diligence on what the market looks like, what’s the eventual potential of this company. It includes meeting the founders, meeting the team members, doing reference checks on the founders. And everything in that process which will help us confirm that our hypothesis is right. And as I mentioned, as you progress through the venture capital job, there’s a third element that comes up, which is called taking a board observer seat or a board member seat, or just seeing a good profit off the company you’ve invested in.
So obviously you won’t do day-to-day jobs with the company, you’re the product manager, you’re not like an operations person for that company. But you can be a good evangelist of sorts. So the founder you just invested in can reach out to you saying, “Hey Aditya, we are leading a search for a new VP engineering, could you help us out?” Or, “Hey Aditya, we are planning on launching product in a new market, do you have any information on this or could you help connect me with some folks that might have some information on it?” And a seasoned venture capitalist actually spends most of his or her time working with the companies they’ve invested in, and less and lesser time finding new companies. Obviously that split differs from person to person, but working with the companies you’ve invested in is a big, big portion of the venture capital job, as and when you move forward in the industry.
Yeah, you know it’s interesting from my perspective, I’ve seen interests in working in VC grow and grow, especially over the past couple of years. And especially amongst students. What skills or traits do you think are necessary to be successful in venture?
Yeah, so let’s talk about the traits rather than skills, because I’m a firm believer that students who are coming out of senior year have the skills to be in any job. I mean, obviously to be a rocket scientist, you need to have a rocket science degree or some sort of a fundamental skill that’s required. But generically speaking, sort of any role in business can be pursued by students coming out of Northwestern, that’s my fundamental belief. So I think traits is what will lead people to certain industries and dissuade then from certain industries. So let’s talk about traits in the venture capital world. So I think first and foremost, what is required is intellectual curiosity. The job can get pretty repetitive at times. So finding new companies, meeting new founders can get monotonous, but I think the fact that intellectual curiosity is a trait helps some people get to the job easily than the others.
And what that means is just being curious about what’s out there. When you see a new company, the fact that you’re excited to hear about that company, you’re excited to hear what makes that company unique. And you have that excitement levels for days and months and years to come, will help you succeed at that job because you’re just that much more excited to find the next big thing that’s out there. And it also comes down to leading your venture capital job with a thesis minded approach. If you’re curious about certain trends, you read about them, you understand what is going on within those trends. And then you work yourself backwards and say, “Okay, this is a trend that’s really big, and these are the companies that are taking advantages of that trend,” and work with those companies to see how that is playing out in the real world.
I think intellectual curiosity is a big trait that’s required when you’re joining the venture capital world. I think secondly, it is how tenacious you are, because if you’re choosing a founder that is pretty sought after, there are 10 to 15 different venture capital firms trying to target the same founder. It then comes down to how effectively can you engage with that founder? And can you actually convince that founder that we, me as the venture capital firm, is the right partner to work with them. So it’s how you convince them, how you pitch yourselves and how you can get the deal done when there’s so much competition in the industry itself.
Yeah, that makes a lot of sense. And I think a third component that we’ve heard throughout is being a people person and focused on relationship building as well, I imagine.
Exactly. And specifically speaking about that, when you invest in a company, obviously the founder you’ve invested in has more knowledge than you have about that space, and it’s hard to tell them to do certain things. All you can do is be a good supporter, be there for them when they need you. As we say at Bessemer, we are just a phone call away from a founder when he or she needs us the most. And that’s our job as venture capitalists. I mean, obviously we’re allocating capital, but more than anything, we just have to be a good support system for founders and help them succeed in whatever way possible.
All right, last question for you. We spoke earlier about you choosing to work in venture capital and “arm the rebels.” That is now your job, and so you take pitches from founders every day who are pitching you their business as an investment opportunity. What would your advice be to one of those founders who was about to pitch you about how to do so?
Yeah, that’s a great question. We’re meeting founders every day and obviously we’re seeing some things, and it makes me happy that you asked this question. So very quickly, what we tell founders is that, do not mold your pitch to fit the VC’s liking or the VCs and mind of how a successful company is defined. So very specifically, a lot of founders asked me, “Hey, what sort of metrics does Bessemer look for? Is there like a revenue threshold that we have to hit before you guys can invest, or whether there’s some sort of a number of customers threshold? But are there any numerical thresholds that we have to hit in order for you to invest?” And my answer is categorically, “No.” It all boils down to what area you invest, what area you’re building in, what sort of company is this? Is this an area we’re excited about? And so on and so forth. So just be true to the vision you’re trying to pursue, without bothering about what numbers you have when you’re pitching.
Secondly, I think it’s really important to build a team around yourself before you go out and raise venture capital. Because if you can convince someone else to be a part of your vision before you can convince VCs to give you money, it gives us some more confidence that, “Hey, there are two or three people that actually believe in this vision and believe in this founder,” while we’re making that investment decision. And lastly, I believe that founders to just keep going at what they’re building without bothering about if VCs are rejecting them. There have been tremendous success stories where founders have been turned down by different funds. And the same funds have come in and invested at subsequent rounds at much higher valuations, which makes me believe that there’s a time and place for everything. Obviously, sometimes things don’t work out at the [inaudible 00:31:06] stage, we don’t have conviction. And founders have been gracious enough to be in touch with us and allow us to invest in their subsequent rounds without taking things too personally, when things don’t work out initially.
Yeah, it sounds like having confidence and conviction in what you’re building instead of blowing like a flag in the wind to whoever you’re pitching what you think they want to hear is important.
But I love that firms might invest in later rounds, because I feel that’s what Bessemer did with you. They didn’t invest in you as an intern, but they hired you as an employee.
All right. Well, I think that’s a great place for us to end, so thank you so much again for sharing your experiences and time with us.
Thank you so much for having me, really appreciate it.
If there’s one lesson I would take away from Aditya, it’s the power of well-crafted cold outreach to people you want to meet, which includes providing some value to them upfront. By creating a student club around venture capital, Aditya had an excuse to reach out to 100s of investors as a student, while also offering to work on projects for them. By building relationships with those already in the industry, Aditya was able to break into venture capital for his first job after school. I encourage you to reach out to those you look up to and want to learn from, and practice sending cold emails to people. It could just lead to your next adventure.
How I Got Here is a podcast from The Garage at Northwestern, and is produced by Melissa Kaufman, Ben Williams and Elisabeth Wright. If you enjoyed this episode, please rate and review us on your favorite podcast platform.