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Notation Annual Meeting - Oct 2018


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This is the deck we used for our first formal annual LP meeting.

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Notation Annual Meeting - Oct 2018

  1. 1. Annual Meeting - October 2018
  2. 2. Agenda ● Notation I overview ● Notation II overview ● Deep dive on mining 2.0 - Bison Trails ● Notation strategy in 2019 and beyond ● Feedback + Discussion
  3. 3. Mission “Our mission is to be the most helpful venture firm in the world for technical founding teams on day 0 of a new startup.” ➡ We believe that hackers will build the best companies of tomorrow, and that all the fun and glory (and profit) is in working with them before what they’re building is obviously valuable. ➡ We invest in technology companies that combine data and software in novel new ways to create fundamentally better experiences for customers.
  4. 4. Notation I - Performance Review At a glance: $6.1M Invested (since Feb-2015) $175k Initial Check / 4.9% Ownership / $3.25M Valuation (Pre) $7.1M Cap Commitments Paid In / $13.6M Total Current Value 24.76% Current IRR (Net) / 1.90 TVPI (Top 5% Percentile) $900k Still Investable (w/o further recycling)
  5. 5. Notation I - Notable Companies [REDACTED - Company Sensitive Info]
  6. 6. Notation I - Potential Breakouts [REDACTED - Company Sensitive Info]
  7. 7. Notation I - Challenges + Lessons Learned [REDACTED - Company Sensitive Info]
  8. 8. Notation II – Performance Review Key Stats: ● $27.8M Fund: $3.4M (12%) Invested (since Nov-2017) ● Pipeline: 298 Companies → 7 Core Investments ● Initial Check: $400k / 10.0% Ownership / $3.10M Valuation (Pre) ● Core Data / Infrastructure: $1.25M Invested ● Core Blockchain: $1.2M Invested (825k Equity / $400k Tokens) ● Core Consumer: $500k Invested ● Non-Core: $475k Invested in 6 Companies ($350k Tokens)
  9. 9. Notation II – Core Companies
  10. 10. Notation II – 2018 Investment Notes Maintaining Discipline in a Frothy (and Challenging) Market 1. We continue to focus on technical teams based in NY that combine data and software in novel new ways to create fundamentally better experiences for customers. 2. Selectively dipping our toes in other non-SV geos (Boston, LA) 3. We have three “types” of core early-stage investments: - $200k in an experimental idea stage project (target 8 total) - $400k-$600k in a prototype / early revenue stage project (20) - $600k+ into a few select seed stage companies (target 4 total)
  11. 11. Notation II – NYC Ecosystem Update The NYC tech ecosystem continues to mature 1. In recent years, NYC has proven it can scale companies - WeWork, Compass, Spotify, Etsy, Glossier, Justworks, Dia, Oscar 2. Technical companies in NYC are scaling too - MongoDB, Datadog, Digital Ocean, Consensys, Bowery Farming, Carmera, Paperspace 3. The local venture community has felt more settled, fewer institutional firms getting going, and very few with technical expertise. We feel well positioned to fund this next cycle of technical founders and startups.
  12. 12. Notation II – Investing in our Firm Building a firm and brand for the long-term 1. We completed our new site and brand, as well as our new operating manual. We believe that these things together much better represent who we are and how we work. 2. The Origins podcast continues to grow, is widely listened to across the startup ecosystem, and has become a unique asset for the firm. 13k listens last month, 4.5x YoY growth since Sep-17. 3. Technical recruiting remains a top priority for our portfolio companies, and we are planning to invest additional time and resources to build more scalable solutions in 2019.
  13. 13. A fundamental shift is underway in the Blockchain space 1. We believe we’re in the early innings of a renewed focus on participating in blockchain networks, rather than pure speculation. 2. This new phase is being driven by next generation blockchains, including a shift from proof-of-work consensus algorithms to proof-of-stake, and competition amongst these networks for mining participants and resources. 3. We’re calling these new forms of participation Mining 2.0 because the new networks are highly varied, and not simply reliant on ASIC hardware and energy advantages. Notation II – Deep Dive into Mining 2.0
  14. 14. Livepeer Case Study Notation II – Deep Dive into Mining 2.0
  15. 15. A Unique Partnership with Bison Trails Notation II – Deep Dive into Mining 2.0
  16. 16. We think that our Livepeer work provides a really compelling playbook for other potential areas of interest and new themes in 2019. 1. Build / Hack on new software platforms 2. Learn and form a thesis on the space 3. Invest and partner with similarly minded founders Potential areas of interest in 2019: Health / Bio, AR, Quantum Notation II – Hacking as a Template
  17. 17. Notation II - Looking towards 2019 Two Things On Our Mind: 1. We’ve been disciplined about valuation and ownership to date (in a very frothy market), but also believe we should be selectively considering more opportunistic investments. 2. Through our first year, we’ve over-allocated to blockchain investments from a dollars and time perspective. We’re excited about our investments to date, but our plan is to more actively focus on new areas of interest in 2019.
  18. 18. Notation - Summary Building a firm and brand for the long-term 1. Notation I appears to be performing well, but it’s still early in the fund’s lifecycle. 2. We feel good about our discipline, work, and early investments in Notation II, and we’ll continue to focus on our core themes and geo, although recognize the importance of selective opportunism. 3. We want to build a more diverse portfolio in 2019, develop and invest in new themes and areas of interest, and invest more consistently across our three early-stage “types.”
  19. 19. Notation - Feedback + Discussion Feedback + Discussion