Deep Dive: The Next Wave of Venture Capitalists, Gen Z

Max Fleitmann
Founder of VC Stack
Deep Dive: The Next Wave of Venture Capitalists, Gen Z
Uma Patel
VC Content Creator

This deep dive was initially published in our VC Stack newsletter. Make sure to subscribe here to not miss any future episodes.

The Emerging Gen Z VC

The term ‘Gen Z VC’ was coined by Meagan Loyst in 2020 to refer to the generation born between 1997 to 2012 that has entered the world of venture capital. Loyst has since created GenZ VCs, a community of 20,000+ founders, angel investors, operators, and aspiring VCs. What originally started as a tweet, led to an article that surveyed GenZ investors on what they considered rising trends and their favorite GenZ companies.

The 2020 survey found the top 4 GenZ trends (71 respondents):

#1 Creator Economy

#2 EdTech

#3 Social Gaming

#4 Prosumer / Consumerization of Enterprise Software

The 2021 survey found the top 4 GenZ trends (132 respondents):

#1 Fintech

#2 Enterprise SaaS

#3 Consumer D2C (Apparel, Beauty, eComm, etc.)

#4 Creator Economy

Today, GenZ makes up 30% of the world's population, and by 2025 will include 27% of the workforce. As the first generation that grew up as digital natives, it’s not a surprise that 80% want to work with cutting-edge technology. Not to forget, GenZ has an estimated $360 billion in spending power which means more companies are needing to appeal to this generation's values and interests. Making it crucial to understand the GenZ consumer, employee, entrepreneur, and investor.

The Gen Z to VC Pipeline

  • On-Campus. Dorm Room Fund, Contrary, and Rough Draft Ventures are just a few examples of programs that allow students to invest in other student entrepreneurs on their campus. Acting as partners at their respective universities, students are meeting founders, writing checks, and supporting their growth all before graduation.
  • Early Career Programs. More established funds are opening their doors to students and post-grads to learn about VC through internships and entry-level roles. VC fellowships are also increasingly popular for those who may opt out of school or make a career pivot.
  • Self-taught. Gen Z is known for the “do it yourself” mentality. Additionally, the internet has fostered the rising creator economy, leading to greater democratization of investing knowledge. This means waiting for a prestigious VC job doesn’t stop them from entering the industry.
  • Personal brand. Carving out a space on the internet is easier than ever and many GenZ VCs have built careers around their personal brand. Whether it's writing a newsletter, growing a community, or hosting a podcast they have the ability to establish credibility, network, and build early into their careers.

How VC aligns with the Gen Z profile

  • Socially online. GenZ might be perpetually online but that means that their network stretches far and wide. They know founders in countries miles away and write for those decades into their VC careers on rising trends.
  • Generalists. The endless access to knowledge means GenZ has formed into a pretty well-rounded group. It’s common nowadays to have seemingly unconnected hobbies, skills, and educational backgrounds whose transferable skills can be quite valuable in a VC role.
  • Impact-driven. As a GenZ, we want our work to be meaningful, so VC allows us to be at the forefront of investing in companies that can positively change the world. When it comes to issues such as climate change, racial and gender equality, and mental health, this generation is among the most vocal and proactive.
  • Independent. GenZ grew up knowing they can access online courses or build a website with just a few clicks. Their go-getter attitude is something that can be largely beneficial in VC where you are people-facing as much as you are analytical.

Top 3 Advantages of Having a Gen Z on Your Team

  1. The target market for many new businesses is GenZ and having the perspective of what appeals to this generation can be quite useful to have close by. The value of the GenZ perspective is why companies such as Z Link exist, to crack the code on how to market to this growing consumer base.
  2. Content-first approaches are often how GenZ establishes credibility early on. This means many of them are entering their careers with established networks and communities as well as a knack for building a voice in the industry. Greatly driving value-add for the firm.
  3. GenZ does not have a profile on what a great founder looks like or what a great company looks like. Although we may lack experience, we are unburdened by how things have always been done. This generation is eager to question outdated infrastructures and rethink the steps to spot the next big company.

How to hire a Gen Z for your fund?

  • Job Boards: Startup&VC reaches thousands of professionals in the tech industry every week via our newsletter and Instagram. Post your VC job with us!
  • Social Media: Posting opportunities on your company's LinkedIn, Twitter and Instagram is always a great entry point to hiring a GenZ. Make sure to keep the initial description short and sweet.
  • Community Groups: Posting or having someone share an opportunity on Slack groups such as GenZ VCs and Girls Who VC allows you to target early-career professionals.

Top Gen Z VC Founders

Paige Finn-Doherty, Founding Partner at Behind Genius Ventures

-> Check out this article we did with Paige on How to raise your first fund as an emerging fund manager

Mohammed & Ammar Amdani, Co-Founders of Adapt Ventures

Jai Malik, Founder of Countdown Capital

Erik de Stefanis, Partner at Interlace Ventures

Founding Partner at Gen Z Ventures

Edgar Vicente, Founding Partner at Enzo Ventures

Top Gen Z VC Investors

Ryan Li, Principle at Countdown Capital

Jan-Soeren Zinke, Investor at IRIS

Madeline Lawrence, Investor at Peak

Gaby Goldberg, Investor at The Chernin Group

Federico Fini, Associate at Karma Ventures

Emily Herrera, Investor at Night Ventures

Sujude Dalieh, Investor at JAZZ Venture Partners

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