/The Notion investment memo is replacing pitch decks for startups

The Notion investment memo is replacing pitch decks for startups

  • Many entrepreneurs use pitch decks to persuade venture capitalists to back their startups.
  • But an increasing share of founders are instead using the app Notion to write investment memos.
  • In Notion, users can make their notes richer by adding images, tables, links, and pop-up windows.

When Mike Adams lacked a pitch deck for Grain, his startup for creating highlights of

Zoom
calls, he didn’t use Google Sheets or Microsoft’s PowerPoint. He turned to the app Notion.

Within 24 hours, Adams wrote an investment memo using Notion for an investor at Coatue Management, who had reached out to gauge interest in fundraising.

Notion allows users to combine text with images, tables, reminders, and subpages. The app’s minimalist design and user-friendly experience have earned it fans and venture investment.

Recently, more savvy startup founders like Adams have abandoned pitch decks in favor of writing investment memos on Notion. The rise of remote fundraising over in-person investor meetings in the past 18 months has only accelerated Notion’s use in the startup universe.

Grain’s memo looks more like a blog post than a PowerPoint presentation. It has text explaining the product and size of the opportunity, surrounded by charts and video clips, made with Grain, of customers reviewing the product. For this reason, the memo is a pitch and demo in one, Adams said.

A memo made on Notion from the startup Grain features video clips made with Grain.

A memo made on Notion from the startup Grain features video clips made with Grain.

Grain


Such memos spare founders the clumsiness of presenting a deck over video.

“These docs that they’re sharing with us are like a replacement for that person being in the room,” said Bryan Rosenblatt, a partner at Craft Ventures who said he’d gotten about a memo a week since the pandemic shutdowns.

Deals are happening faster, with founders having fewer meetings with investors to tell their stories, said Sarah Cannon, an Index Ventures partner who led the firm’s investment in Notion. Founders can make up a lot of ground by sending a memo that’s rich with context, she said.

A Notion memo from the design startup Blush grabbed the attention of Lolita Taub, whose micro-venture fund focuses on community-driven startups, because it featured a feed of users’ tweets. That helped her find members to contact as part of her due diligence.

A memo made on Notion from design startup Blush features a "love wall," or a feed of tweets from users.

A memo made on Notion from the design startup Blush features a “love wall,” or a feed of tweets from users.

Blush


Notion even promotes this use case with a funding memo template inspired by the one that the business-to-business startup Argyle used for its $20 million Series A round.

That memo took almost three months to write, CEO Shmulik Fishman said. It has a narrative structure, but the reader can click on executives, customers, or competitors to read more about them in pop-up windows.

“Standing out is probably the hardest part of fundraising — you always want to present yourself in a way that’s actually unique to what you’re building,” Notion’s chief operating officer, Akshay Kothari, said. “We’re so glad tools like Notion can help with that.”

A memo made on Notion from business-to-business startup Argyle lets the reader click an executive to read their bio in a pop-up window.

A memo made on Notion from the business-to-business startup Argyle lets the reader click on executives to read their bios in a pop-up window.

Argyle


Best of both worlds

Not everyone loves investment memos. Semil Shah, a partner at Lightspeed Venture Partners who founded the seed fund Haystack, uses Notion to keep his work organized. But he prefers pitch decks, especially for growth-stage companies, because they’re digestible.

“I’m a sample of one, but most of the Notion pitches I’ve seen tend to run on with words, becoming like soup,” he said, “and sometimes it feels like you’re reading a New Yorker article online, when it’s more pleasant to read those in print.”

"Notion investor memos are the new pitch decks," says venture capitalist Erik Torenberg.

“Notion investor memos are the new pitch decks,” the venture capitalist Erik Torenberg says.

Twitter/@eriktorenberg


Instead, founders should think of a memo as an appendix to a deck, said the Initialized Capital partner Alda Leu Dennis.

When Parker Conrad was raising funding for his startup Rippling in 2019, he sent prospective investors, including Initialized, a memo and 46 slides of metrics, projections, and detailed footnotes, Dennis said.

The memo is a “great resource for selling the dream and answering questions” in the diligence process, she said, adding that it shouldn’t substitute a deck because investors “consume information more efficiently in sound bites and visually.”

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