How Notion Capital uses data to source better deals and screen 50% more companies a year

Introduction

Notion Capital is a European B2B SaaS and Cloud VC with more than $700m assets under management, and more than 100 investments to date. Notion’s investments include Brightpearl, Currencycloud, GoCardless, Mews, Paddle, Tradeshift, Unbabel and YuLife.

Notion needed a CRM to serve as a centralized system of record for the firm and surface relevant data points to support decision-making. Using Affinity and RISTA, the firm’s proprietary technology, Notion now has access to company and founder data that allows them to proactively reach out and maintain relationships with potential portfolio companies.

With Affinity, Notion can now:

• Prioritize opportunities and identify the deals that require attention, allowing the firm to screen 50% more companies a year
• Connect Affinity to external data sources to create the company’s system of record in one place
• Establish triggers that support proactive outreach and a competitive edge in investing

Challenge

Static CRMs and static adoption

In Venture Capital, a firm is only as successful as its decision-making abilities. Dealmakers have to make the right decisions around which companies to source, what information is relevant in the due diligence process, and the investment amount in the deals they close.

As Kamil Mieczakowski, Principal at Notion Capital shares, “If you're a VC firm, it's a very competitive space, and everyone is trying to figure out what their edge is. For us, a core focus has always been around data, good coverage, and being very informed in the market rather than very reactive.” 

Notion Capital is a venture firm made up of SaaS entrepreneurs and operators turned investors, specializing in early stage SaaS companies. The team relies on data from multiple sources to make decisions around sourcing and investing. Notion ultimately invests in 0.6% of the companies they meet with, and the information that helps them determine who to invest in includes founder information, key executive hires, and other data points that help determine deal potential.

Before Affinity, Notion had a very limited CRM that offered little in the way of data and integrations. Onboarding new employees was time-consuming and using the available data was tedious. This meant people stopped using the CRM and lived in Google Sheets instead. Says Mieczakowski, “If I wanted to know who the investors were in a business, I'd have to leave the CRM and go into Crunchbase, or if I wanted to see who was the founder of that business, I'd have to go on LinkedIn... it was like an elevated spreadsheet rather than a CRM.” The team needed an easier-to-use solution that proactively surfaced the relevant data.

Solution

Creating a tailor-made solution powered by Affinity

After considering many different options, including Salesforce and Pipedrive, Notion decided to build their own solution using Affinity. Says Itxaso del Palacio, Partner at Notion, “I think of Affinity as our system of record, and today, whenever any deal is done, we can go and check who spoke to that company and our full history.”

Ultimately, as Mieczakowski put it, “Affinity has a good combination of UX and more of an opinionated layer, where you have a system that you can embrace when working with some readily available data sources inside of the CRM, such as PitchBook, CrunchBase,  and Dealroom.” 

These integrations allowed Notion to revamp the way they approached sourcing, due diligence, and dealmaking. In 2018, Notion decided to create RISTA (reconnaissance, intelligence, surveillance and target acquisition, like the US military term), their proprietary data intelligence tool that sits on top of Affinity. RISTA uses signals to identify potential opportunities in external data sources such as LinkedIn, Crunchbase, ProductHunt and others. The opportunities are ranked and are automatically entered into Affinity. As del Palacio puts it, “Once you have those integrations you can start thinking about metrics to prioritize deals and to process deals faster. This is what we do in Affinity” 

With Affinity, Notion now has access to much more information directly in their CRM, including investors, founders, series, funding round information, and total amount of capital raised. RISTA complements the data available in Affinity with an additional layer of data relevant to the firm. This includes founder information like LinkedIn profiles, work experience and job titles, years of experience, company growth rate, web traffic, and competitive density.

Affinity has also enabled Notion to adopt a more proactive outreach and sourcing approach. The team is notified when a major activity takes place such as a C-level executive joining a company they’re monitoring. Says Mieczakowski, “In early stage startups, it's as difficult to close your first deals as it is to close incredible people who believe your narrative and join the journey so early on, so if we see founders that are talent magnets, we also want to know about that.” 

With a strong pipeline in place, Notion also uses Affinity to conduct thorough due diligence. Del Palacio shares how Affinity helps them be more operationally efficient: “Affinity allows us to create different fields and stages for the potential companies, so we can be on top of those stages, set up priorities, and assign tasks and ownership to people, making us much more efficient. It’s finding the best deals at the top of the funnel as well as operational efficiency.”

A successful investment built on relationships

Affinity and RISTA’s integration was a crucial element in Notion being a part of TestGorilla’s $10 million seed round. RISTA initially surfaced the Dutch company because the company’s co-founders were both second-time founders. Per Mieczakowski, “when we see a combination of two second-time founders who had an exit before building a new business, you want to get on top of that company ASAP.” Once TestGorilla was added to Affinity, it was assigned to a regional lead, who, in turn, used Affinity to set up reminders to stay in touch, and start building relationships.

As the company grew and started raising, Notion quickly jumped on the opportunity. They were in a position to act fast because they had identified the company early on in the process, built trust, and established a solid relationship with the founders. TestGorilla received over a dozen term sheets and they chose Notion because they had the time to understand and experience the value that Notion can bring to a B2B SaaS business.  “If it wasn't for RISTA, and then Affinity helping us run an efficient process with the reminders, timeline, and everything else, we could have missed it or we could have been late to the party,” says Mieczakowski.

Results

Working towards that infinite deal flow

With Affinity and RISTA, Notion Capital has a system that surfaces the best companies and allows the team to efficiently work through deals. As evidence of this, they now have an SLA where every outbound opportunity is processed within seven days. As Mieczakowski shares, the team may start their week with 50 companies for outbound outreach but by the end of the week, the figure is at zero. “It's a combination of being more efficient, thanks to RISTA and Affinity,  having a good process, and then having visibility into what actually gets processed.” 

As Notion looks to the future, they’re planning ways to automate more processes that will help associates and partners increase deal flow. Says del Palacio, “in this business, you’re never finished with leads. The number of leads and companies is infinite. So it's not about getting money or time back. It is about being able to process more deals faster, so we can be the ones who get to an opportunity before anybody else does.” 

With Affinity and RISTA powering their day-to-day, Notion ensures they are sourcing as many high quality, data-driven deals as possible while also proactively managing relationships across their collective network.

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