In the Wake of the ‘Zombie Fund’ Era, Venture Capitalists are Charting New Career Courses

The unexpected era of ‘Zombie Funds’ has struck the venture capital world, a phenomenon triggered by a decade-long market boom that enhanced the cultural allure of the industry, drawing countless finance professionals. Yet, the scarcity of liquidity has forced many into making drastic career changes.

While some have managed to remain on their General Partners’ (GP) payrolls while seeking new opportunities, others are not so fortunate. These developments come as promotions are increasingly delayed, compensation rates stagnate, and companies even resort to diminishing job titles. This only adds to the existing professional turmoil.

Yet, some individuals have successfully made the switch. For instance, Kevin Zhang, formerly of Firstmark Capital, brought to life generative AI startup Shadow AI, while Zain Rizavi left Ridge Ventures to co-establish a stealthy AI cloud security enterprise.

For the more risk-averse, a lateral shift to corporate venture capital presents a safer alternative, offering the chance to maintain their VC practice under the umbrella of an established brand, free from the pressures of fundraising. Similarly, taking their VC expertise to a family office or fund-of-funds has also proven to be a popular choice. Although the entry barriers to family offices can be high, they are not insurmountable.

More audacious individuals have even considered establishing their own funds. Despite the challenging fundraising landscape, many ex-principals and partners have successfully secured Limited Partners (LPs). While a drastic cut in cash salary is a given, the largely untouched carry presents an interesting avenue for high returns.