Notation Capital’s Fund 1 deck outlines a $6M pre-seed venture fund focused exclusively on highly technical founders in New York City. The 18-slide presentation relies heavily on a four-part thesis: the increasing capital efficiency of internet companies, the maturation and turnover of NYC technical talent, the upward migration of established VC firms into larger rounds, and the founders' unique positioning to fill the resulting pre-seed gap. With a target of 10 investments per year at $150k each, the fund emphasizes 'first money' entry and a physical presence in Brooklyn to foster community.…
Key takeaways
- The fund targets a $6M total size with a 20% carry structure and a $1M cap on total operating costs (Slide 13).
- The investment strategy focuses on 10 pre-seed deals per year, typically investing $100k-$200k as the 'first money' in (Slides 13, 14).
- A core metric of the thesis is the users-to-engineer ratio, citing WhatsApp's 14M:1 ratio at acquisition as evidence of extreme operational efficiency (Slide 6).
- The deck identifies a market gap caused by firms like USV and Thrive Capital 'moving higher up the stack,' leaving a vacuum at the true angel/pre-seed level (Slide 11).
- The founders, Alex Lines and Nick Chirls, emphasize their decade-long history in the NYC startup community and backgrounds at betaworks (Slide 3).
- The fund uses a physical office in Brooklyn as a strategic 'space to build' for founders to foster community (Slide 15).
- The 'Talent Turnover' thesis argues that $15B+ in value created by first-wave NYC companies like Etsy and Tumblr is now fueling a second wave of technical founders (Slide 7).
- The deck lists 18 previous investments or advisory roles, including Namo Media and Grand St, both of which were acquired (Slide 17).
Notation Capital Fund 1: A Thesis-Driven Pre-Seed Teardown
The pitch deck for Notation Capital Fund 1 is a distinct departure from the standard corporate venture capital presentation. Eschewing bar charts and complex financial modeling, the deck uses a high-contrast, text-heavy aesthetic overlaid on raw photography of New York City. This visual choice reinforces their core identity: a fund built by and for the NYC technical community. The narrative is structured as a logical progression from macroeconomic trends to local market gaps, concluding with a specific, actionable fund structure.
Slide 1: Title Slide
The deck opens with a simple title, "Notation Capital," placed over a photograph of a Brooklyn street scene featuring the Williamsburg Bridge. There is no subtitle or tagline here, allowing the imagery to set the geographic focus immediately.
Slide 2: The Mission
The mission statement is explicit: "Be the first partner to highly technical founders capable of building and scaling capital efficient internet companies in NYC." This slide establishes three non-negotiable pillars for the fund: technical founders, capital efficiency, and a New York City geography.
Slide 3: Team Background
The "Who We Are" slide introduces Alex Lines and Nick Chirls. Rather than traditional titles, Lines is labeled a "Hacker" and Chirls an "Investor / Product." Their history is tied to betaworks, bitly, and chartbeat. The slide emphasizes their ten-year tenure in the NYC startup community, framing them as insiders rather than outside financiers.
Slide 4: Thesis Part 1 - Capital Efficiency
The first part of the fund's thesis focuses on the decreasing cost of scaling infrastructure. It quotes Chris Dixon and Benedict Evans to illustrate a trend: companies are reaching massive user bases with progressively less capital and fewer employees. This slide sets the stage for why a small $6M fund can be impactful; if companies need less money to reach milestones, a $150k check carries more weight.
Slide 5: Operational Efficiency as a Force Multiplier
Continuing the efficiency theme, Slide 5 argues that modern tools (PaaS, automation, distributed architectures) allow a single engineer to manage vast infrastructures. This is presented as a "force multiplier" that enables small teams to build "huge infrastructures."
Slide 6: The Efficiency Metric
This slide provides the quantitative backing for the efficiency thesis by listing users-to-engineer ratios at the time of acquisition or major milestones. It cites YouTube at 1M:1 (2006), Facebook at 1.2M:1 (2013), Instagram at 12.5M:1, and WhatsApp at 14M:1. These figures are used to suggest that the potential return on invested capital is increasing as the headcount required to serve users decreases.
Slide 7: Thesis Part 2 - Talent Turnover
The narrative shifts to the NYC ecosystem. Slide 7 claims that NYC has created over $15B in value during the current cycle through "category creating wins" like Kickstarter, Etsy, Tumblr, MakerBot, and BuzzFeed. This establishes that NYC is no longer an emerging market but a mature one with significant realized value.
Slide 8: The Maturing Ecosystem
The deck argues that as these first-wave companies mature, their technical talent is beginning to leave to start new ventures. This "turnover" is the primary source of deal flow for Notation Capital. They position themselves to catch the "next wave" of companies built by these experienced operators.
Slide 9: The Talent Graph
To prove they can find this talent, Slide 9 introduces the concept of the "talent graph." The founders claim to be systematically mapping movements in the NYC network using data and "human intelligence." This adds a proprietary, data-driven layer to their sourcing strategy, moving beyond simple networking.
Slide 10: Community Roots
Slide 10 reinforces the team's personal connection to the talent pool. It states, "these are our people," referring to the hackers and designers they have worked with for years. This slide balances the data-driven approach of the previous slide with a "boots on the ground" relational advantage.
Slide 11: Thesis Part 3 - VCs Have Leveled Up
This is a critical market-gap slide. It argues that top-tier NYC firms like USV, Thrive Capital, First Round Capital, and Lerer Ventures have moved "higher up the stack" (investing in later, larger rounds). This has left a vacuum at the "true angel / pre-seed" level, which Notation intends to fill. They name-check other firms still in the space, such as Brooklyn Bridge Ventures and Box Group, to define their competitive set.
Slide 12: Thesis Part 4 - A New Firm
The thesis concludes by identifying a "meaningful opportunity" for a small, NYC-focused pre-seed fund. The founders assert that their experience in building and scaling products makes them uniquely positioned to provide the "guidance" these technical founders need alongside early capital.
Slide 13: Fund Structure
$6M Pre-Seed Fund · 10 Pre-Seed investments per year ($150k each) · $1M Cap on total costs (management, operating, legal, etc.) · 20% Carry
The $1M cost cap is a notable detail, suggesting a lean operation where the majority of the $6M is deployed into startups.
Slide 14: Strategy Part 1 - Pre-Seed Definition
Notation defines pre-seed as "investing first money into highly technical teams pre-product or early prototype." They specify an investment range of $100k-$200k, which they note may represent the entire pre-seed round. The goal is to get the product to market and prepare the team for institutional seed capital.
Slide 15: Strategy Part 2 - Space to Build
The fund includes a physical component: an office in Brooklyn. This is intended as a workspace for founders to build and a hub for the broader community. This "space to build" is presented as a tool for building a strong network beyond just the portfolio companies.
Slide 16: Co-Investment Relationships
Slide 16 lists 30 firms they have invested with or have relationships with, including major names like Index Ventures, Spark Capital, and SV Angel. This demonstrates their ability to provide portfolio companies with "capital access" for subsequent rounds.
Slide 17: Previous Investments
The track record slide lists 18 companies where the founders had "Sweat," "Investment," or "Advisory" roles. Notable exits mentioned include Hyperpublic (acquired by Groupon), Namo Media (acquired by Twitter), and Grand St (acquired by Etsy). This validates their ability to pick and support winners in the NYC market.
Slide 18: References
The final slide is a list of 17 high-profile references, including Naval Ravikant (AngelList), Andy Weissman (USV), and Shana Fisher (High Line Venture Partners). This serves as a final social proof layer, indicating that the most respected names in venture and tech endorse the founders.
What Notation Capital Fund 1 Does Well
The deck excels at defining a specific, defensible niche. By focusing on "highly technical founders" in a specific geography (NYC) at a specific stage (pre-seed), they avoid the "generalist trap." The logic of the thesis is sound: if the cost of building is going down (Slide 4) and the talent pool is maturing (Slide 7), then a small, specialized fund is the most efficient vehicle to capture that value. The inclusion of a physical space in Brooklyn (Slide 15) and a data-driven talent graph (Slide 9) provides tangible examples of how they will add value beyond just writing a check.
What is Missing from the Deck
While the thesis is strong, the deck is light on the specific mechanics of the "Talent Graph." It mentions mining signals to predict movements but doesn't explain what those signals are or how the data is processed. Additionally, while Slide 13 mentions a $1M cap on costs, it doesn't detail the management fee percentage, which is standard in fund decks. There is also no mention of the expected fund lifecycle (e.g., a 10-year fund with a 3-year investment period), though the "10 investments per year" suggests a rapid deployment phase.
What Other Founders Should Copy
Founders raising for a fund or a startup should emulate Notation's use of a "Market Gap" slide (Slide 11). By showing that established players have moved "up-market," they create a logical necessity for their own existence. Furthermore, the use of a specific, non-obvious metric—the users-to-engineer ratio (Slide 6)—is a powerful way to ground a broad thesis in quantitative reality. Finally, the "References" slide (Slide 18) is an underutilized tactic; listing reputable names who are willing to vouch for you is often more effective than a standard "Advisors" slide with headshots of people who may only have a tangential relationship with the project.
Frequently asked questions
- What is the specific investment focus of Notation Capital Fund 1?
- According to Slide 2 and Slide 14, the fund focuses on being the 'first partner' to highly technical founders in New York City. They specifically target the pre-seed stage, which they define as investing 'first money' into teams that are pre-product or at the early prototype stage. They aim to provide the initial capital and guidance necessary to get a product to market and eventually raise institutional seed capital.
- How does the fund justify the need for a new pre-seed firm in NYC?
- The justification is two-fold. First, Slide 11 argues that established top-tier NYC firms like USV, Thrive Capital, and First Round Capital have moved 'higher up the stack' to larger rounds. Second, Slides 7 and 8 argue that NYC has reached a level of maturity where technical talent from successful first-wave companies (like Kickstarter and BuzzFeed) is now spinning out to start new ventures, creating a surge in demand for early-stage capital.
- What are the financial terms and structure of the fund?
- Slide 13 explicitly outlines the fund structure: a $6M total fund size with a 20% carry. It sets a $1M cap on total costs, which includes management, operating, and legal expenses. The deployment strategy is to make 10 investments per year at an average of $150k per investment, though Slide 14 notes the range can be between $100k and $200k.
- What is the 'Talent Graph' mentioned in the deck?
- On Slide 9, the founders describe a systematic approach to mapping the NYC 'talent graph.' They use publicly available data and human intelligence to mine signals that predict when key technical people are moving between companies or preparing to start new ones. They express an intent to productize or open-source these findings, positioning the fund as a data-driven scout for talent.
- Who are the founders and what is their track record?
- The fund was founded by Alex Lines and Nick Chirls. Slide 3 describes them as 'technologists first' with a decade of experience in NYC. Alex Lines is credited as a 'Hacker' with experience at betaworks, bitly, and chartbeat. Nick Chirls is described as an 'Investor / Product' lead from betaworks and HFC. Slide 17 lists their previous investment and advisory history, including companies acquired by Twitter, Groupon, and Etsy.
