Having just spent the week in Silicon Valley this seems to be the view of most of the leading Talent Partners working at the top VC and PE firms on Sand Hill Road.
Working out of our offices in Menlo Park we had the chance to meet senior talent professionals at Norwest Venture Partners, Kleiner Perkins, Battery Ventures, Lightspeed, Silver Lake, Sapphire Ventures and Sequoia. In total, these investors have more than 600 companies in their portfolios.
So, what are some of the views from these elite perches of the technology sector? A common theme is that the tech sector is in another bubble. Teri McFadden at Norwest Ventures summed it up well be saying that everything is at its peak in the Valley right now; “transport, housing, talent availability, compensation, company valuations...”
So, when will the bubble burst?
No time soon says Brian Kasser over lunch at Lightspeed. His take is that technology is too omnipotent in most businesses now. Even if there is a macroeconomic downturn companieswill need to double down on their technology investment to achieve even greater efficiencies.
So, what are the hot skills in demand?
“Mostly go to market roles – sales, marketing, customer success” according to Elizabeth Patterson at Sapphire Ventures. “For some reason, we are seeing very few senior engineering roles at present” she observed.
“It’s als hard to find great CFOs. We are having to run boot camps to try and develop VP Finance talent to step up into CFO roles”.
This was a theme echoed by Jackie Xu at Kleiner Perkins and Jenny Kang at Sequoia – the need to develop talent networks and really stay close to functional cohorts.
What can entrepreneurs do to hire the best talent?
“Bring roses on your first date” observed Kelly Kinnard at Battery Ventures drily. “You can’t win just on cash” says McFadden, “Google will always pay more”.
Bethany Riedy at Silver Lake runs a slick and very structured search process to drive the right result from her recruitment partners. Of course, there is no silver bullet but what comes across is how serious, focused and thorough the talent professionals are in looking to build out world-class leadership teams and track talent for their portfolio companies.
European VCs are beginning to develop an ecosystem of talent professionals to try and mirror what’s in the Valley. As someone who has worked in both markets for 20 years, I would say we are 5-10 years behind in Europe (with a few honourable exceptions).
On a personal note, it’s always such a buzz to spend a week at the epicentre of our industry. However, all is not perfect in the Garden of Eden. As noted earlier, the traffic on the 101 and 280 connecting San Francisco and the Valley is beyond a joke (top tip - take the Caltrain). Housing and office space is in short supply and exorbitantly priced – we had a Renaissance office night out and put the staff up in an Airbnb in Palo Alto as they all commute into Menlo from San Jose or further afield. And, for all the concentration of wealth and innovation in this part of the world it can feel a little shabby, particularly the public infrastructure (roads, bridges etc.).
As for San Francisco, the numbers of homeless people and beggars on the street seems to get worse with every visit, as does the all-pervading fug of cannabis fumes on the street. Waiting at SFO for the flight home you also wonder why the owners of the airport don’t take a trip to Terminal 5 Heathrow to see how a world-class airport should treat its customers. Everything in Europe is not perfect either – and the dreaded Brexit was mentioned a few times on our trip.
The Valley remains where it’s at in the tech sector, but as I said to all of our gracious hosts on the trip, we would love to see you in Europe and your portfolio companies could do worse than look at London, Berlin, Barcelona, Stockholm or Paris to build out their businesses.
We’ve got the beautiful locations and the talent...
