VC firms face a number of unique challenges, not the least of which is finding the key to effective talent management. In an increasingly globalized corporate climate, VC firms are tasked with managing talent across multiple cultures, both secular and corporate. Managing talent across an extensive portfolio is no easy task.
What can VC firms do to cultivate and maintain strong internal talent pipelines and ultimately win the war for top talent? Consider the following challenges and their solutions.
Challenge Number One: Managing and Sharing Talent Networks
Perhaps the most difficult talent management challenge facing VC firms is the disconnect between talent networks among their portfolio companies. In an effort to bridge this gap, some VC firms hire internal talent teams to build and manage their ecosystem of people and companies.
Although many talent executives come from an executive search background, they’re not there to replace the external recruiter and fill openings within the firm. Instead, they’re looking to connect with great talent that they feel could contribute to one or more of their portfolio companies. It’s critical to connect the talent team to the firm’s entire ecosystem — Partners, Portfolio Companies, Advisors, and 3rd party Recruiters — allowing VCs to build and share their dynamic talent and company networks.
These small talent teams face an uphill battle as the portfolios grow and diversify. In many cases, it is not economically feasible to add talent team members as portfolio growth occurs. Therefore, what is needed is technology to connect the disparate talent networks within the VC firm’s ecosystem so that talent teams achieve a bird’s eye view of the talent pipeline. Gaining this type of overarching perspective of the existing talent pipeline enables talent teams to contribute true strategic value to the VC firm.
Challenge Number Two: Competing Globally for Top Talent
Most VC firms would agree that increasing globalization complicates talent management to at least some degree. VC firms operating on a global scale face cultural barriers, disparate perceptions among their portfolio companies regarding talent management, and difficulty in maintaining balance between global and local talent.
Commenting on the results of an Ernst & Young global talent management survey, Mike Cullen, Global Managing Partner, People, EY says: “Companies … are facing major challenges in building and executing effective talent management strategies. The key challenge for these companies in the next decade will be to integrate talent strategies with global mobility strategies to form a top management team that has a mix of international expertise and local knowledge.”
Due to the time and investment needed to fully develop an internal talent pipeline, VC firms turn to recruiting from competition. This strategy, however, is fraught with its own difficulties, as it contributes to the problems of high turnover and inflated salaries, thus exacerbating the problems inherent in developing a global talent management process in the first place.
While talent acquisition strategies do include a component of recruiting top talent from outside a VC firm’s own ecosystem, it is reasonable to conclude that a VC firm which intends to remain competitive must place emphasis on developing a strong internal talent pipeline. Put simply, it is important for VC firms to adequately use available talent resources within their ecosystems before turning to competitors to acquire top talent.
eBook: How to Attract Top Talent Using Inbound Recruiting – Find out how to harness the power of an inbound recruiting strategy in order to attract, hire, and retain top talent.
To that end, VC firms must use available technologies to support and nurture internal talent pipelines and match candidates within the firm’s ecosystem with open positions, as well as support outside recruitment when needed.
Thrive has developed a robust talent relationship management solution to accomplish just that. Thrive’s TRM enables VC firms to:
- Gain a global view of open positions
- Quickly match the right candidates with the appropriate openings
- Capture crucial candidate intelligence
- Share contact profiles and feedback across the entire ecosystem
- Maintain a centralized database that keeps ownership in-house
Thus, Thrive’s TRM addresses the challenges VC firms face regarding talent management both locally and globally. Would you like to see this solution in action? Schedule a demo and take advantage of all that Thrive can offer for your VC firm today.