Sea of Change

One of benefits of being in venture capital is that you can see activity and trends across a broad array of industries. Additionally, you spend a considerable amount of time talking to people about deals, career changes, financings or general assistance. You can also get a sense of how certain companies are doing based upon how many resumes are coming out of the firm or how difficult it is to recruit people from that firm.

Over the last four months or so, I have been noticing a different kind of trend occurring than I have seen in the past. Normally, we see a lot of people looking to move within their industry or to get into private equity. However, I am now seeing a lot of people seriously reconsidering what they are doing and whether they should remain in their given profession. A lot of this is being driven by fatigue or disillusionment. This includes a number of people in the private equity world (and other investment circles) looking else where. In other words, there is a lot of soul searching going on right now, much, much more than I have seen in the past.

I believe this is being driven by the maturity of the current economic cycle as well as by the continuing swell of liquidity into all investment sectors. It has become harder and harder to find undervalued real estate, buyout targets, product markets and such. As people grind harder and harder to drive returns (or profits), the future upside has become increasingly less apparent. This is a sign of an extended market.

Now, I am not saying that a correction is around the corner or that I see anything in particular. However, I can say that the overall conditions remain increasingly unstable with an occasional upswing or downswing in the markets.

So, if you happen to be one of those who is seriously reconsidering your chosen path, you are not alone. It is harder to do what you need to do (unless you are a corn farmer). On one hand, I would comment that life is too short to not be doing something you love or were made for. These challenging times can create a needed forcing mechanism to move. However, on the other, I would say that every industry has its cycles and even preferred professions will hit very difficult times. Persevere through these downturns and you are in a strong position on the recovery. Only you really know what you love to do (and have the skill set for) so as to determine which course is right for you.

Brian Kim has a very popular post for a quick exercise on "How to Find What You Love to Do".