# Not Boring Capital Fund II Financial Model Not Boring Capital is a media-augmented venture fund run by newsletter writer Packy McCormick, investing in companies with compelling narratives and helping tell them. - Canonical: https://finamodel.com/startups/not-boring-capital-fund-ii - Excel download: https://finamodel.com/startup-models/not-boring-capital-fund-ii.xlsx - Category: Media/Gaming - Model type: VC Fund Waterfall - Funding round: Fund 2 - Funding: $25M - Founded: 2022 - Geography: Global (US-centric; selective web3/India/international) ## About the company Not Boring Capital Fund II is a solo-GP venture fund supported by the Not Boring newsletter, Twitter, podcast, and syndicate. It invests in narrative-rich companies and offers media distribution as a differentiator, while generally not leading rounds or taking board seats. The fund uses a standard two-and-twenty structure: a 2% fee for four years, 20% carry after return of capital, a $500,000 GP commitment, and 10% reserves. Target checks are $100,000–$500,000 across an approximately even Pre-Seed/Seed, Series A, and Series B-plus mix. Fund I raised $9.9 million, deployed about $7.8 million by the end of Q3 across 79 closed companies, and saw a 13.9x Braintrust mark. Fund II materials show a $25 million terms slide and $30 million model assumption. The model should separate management-company fees from fund deployment, carry, DPI, TVPI, RVPI, and LP net IRR. ## What's included - 5-year monthly revenue build with stage-appropriate growth assumptions - Full P&L, headcount plan, and operating-expense schedule - Cash-flow statement, runway, and burn-rate tracking - Valuation via exit multiple with a DCF cross-check - Returns analysis with MOIC and IRR - Unit economics including CAC, LTV, payback, and cohort retention ## Product & value proposition - Solo GP venture fund anchored to the "Not Boring" newsletter (~90,000–98,000 subscribers at time of raise). - Invests in companies with stories to tell; provides marketing/narrative value-add via newsletter deep dives, Twitter (125k followers), podcast, and syndicate (1,500 backers, $4M deployed across 25 deals). - Does not lead deals, does not take board seats - piggybacks on larger lead funds' diligence while providing media distribution as a differentiator. - Fund II check size target: $100k–$500k, with ability to flex. Fund I range was smaller. - Stage mix target: ~1/3 Pre-Seed/Seed, ~1/3 Series A, ~1/3 Series B+. ## Market - No explicit TAM/SAM/SOM framing for the VC market is presented. - Market context provided: 994 unicorns tracked by Crunchbase as of Q3 2021, worth $3.4T combined; 132 new unicorns in Q3 2021 alone - more than 1 per day. - 83 unicorns went public in first 9 months of 2021 at combined $958B market cap, average IPO valuation $11.5B. - YTD 2021 unicorn debut valuation ($958B) exceeded the prior 3 years combined. - Implication: the fund's opportunity set is described as historically large and growing; no formal VC market TAM stated. ## Revenue model Standard 2-and-20 venture fund structure: - Management fee: 2% per year for 4 years, then 0%. On $25–30M fund, this implies ~$500k–$600k/yr management fee for years 1–4. - Carried interest: 20% of profits above return of capital (standard waterfall; hurdle rate not specified in deck). - GP Commitment: $500k (mix of fees and cash). - Reserves: 10% of fund for follow-ons; most follow-ons via SPVs. - Syndicate revenue (separate from the fund): Not Boring Syndicate has deployed $4M across 25 deals with 1,500 backers; carry/fees on syndicate deals are an additional revenue stream not broken out. - Sponsored deep dives: Companies pay Not Boring to write about them (separate newsletter revenue; not quantified). ## Traction & metrics Fund I: - Raised: $9.9M (target was $5–7M) - Deployed: In ~6 months (target was 12 months) - Companies invested (Fund I, through Q3 2021): 79 closed + 16 in process/Q4 - Total $ deployed as of end of Q3: $7,827,762 across tracked portfolio - Stage allocation actuals: Pre-Seed 13.41% ($1.05M), Seed 31.79% ($2.49M), Seed+ 18.20% ($1.43M), Series A 20.30% ($1.59M), Series B 2.87% ($225k), Series C-D 5.75% ($450k), Series E+ 7.66% ($600k) - Largest vertical by $ invested: Fintech - $1.36M across 13 companies - Second largest: web3 - $1.01M across 12 companies Traction/marks: - Braintrust ($BTRST) token launch: fund's investment marked at 13.9x in "a couple of months"; Braintrust valued at $2.3B at time of screenshot (peaked at ~$11B, settled ~$2.5B) - Multiple other investments described as "closing with signed term sheets or offers on the table" - no specific marks given except Braintrust Newsletter / distribution: - Newsletter subscribers: ~90,000 (slide 01) / 98k (slide 03) - Twitter followers: 125k - Podcast listeners: ~3–7k per episode - Syndicate: $4M invested, 25 deals, 1,500 backers ## Unit economics - Average Fund I check size: $7,827,762 / ~79 deals ≈ ~$99k per deal - Fund II target check size: $100k–$500k - Management fee economics: 2% × $25–30M = $500k–$600k/yr for 4 years (~$2M–$2.4M total management fees) - GP take on carry: 20% of gains above return of capital on $25–30M fund - No CAC, LTV, or margin data stated - not applicable to a VC fund in standard operating sense ## Competition / moat - Moat framing: newsletter is the "unfair advantage" - without it, Packy states he would be "a very average venture investor at best" - Does not compete with large funds for deal leadership; instead co-invests alongside them (explicitly positioned as complementary) - Distribution moat: 90–98k newsletter subscribers, 125k Twitter followers providing organic dealflow and LP outreach - Media value-add: Sponsored deep dives (companies pay to be featured), public investment memos, podcast generate goodwill and differentiation with founders - Structural advantages listed: no board seats, no deal leads = more investments, faster deployment, broader portfolio - Risks acknowledged: missing winners despite high volume, less time diversification, inability to raise future funds, reputational risk from over-extension, conflicting out from competitive investments ## Team & funding ask / use of funds - GP: Packy McCormick (solo GP) - writer of Not Boring newsletter - No other named team members in the deck - Funding ask: $30M for Fund II - Use of funds: Deploy into Seed to Series B tech startups; $100k–$500k checks; ~1/3 pre-seed/seed, ~1/3 Series A, ~1/3 Series B+; growing web3 allocation (was ~11% in Fund I, expected higher in Fund II) - 10% reserves for follow-ons; most follow-ons via SPVs outside the main fund - GP Commitment: $500k - Terms: 2% mgmt fee for 4 years then 0%, 20% carry --- ## Recommended financial model - **Archetype + why:** Venture fund economics model (management company P&L + fund-level return waterfall). This is not an operating startup - it is a closed-end fund raising from LPs. The appropriate model has two layers: (1) a **management company P&L** (management fees as revenue, GP operating expenses, solo GP comp) and (2) a **fund-level return / DPI / TVPI waterfall** (committed capital → deployed capital → portfolio MOIC → carried interest → LP net returns). No 3-statement operating model is appropriate. No revenue forecast for a product/service. If a simpler model is preferred, use a **VC fund cashflow and carry model**. - **Forecast horizon & granularity:** 10-year fund life (standard for VC); annual granularity for management company P&L; quarterly or semi-annual for deployment schedule; single-period waterfall for carry calculation at exit scenarios. - **Key drivers & assumptions:** Fund structure: - Fund size: $30M (note: Terms slide shows $25M; model both, flag discrepancy) - GP commit: $500k - Management fee: 2% × 4 years, then 0% - Carry rate: 20% - Reserves for follow-on: 10% - Investable capital: $30M × 90% = $27M (net of reserves) - Deployment period: 6–12 months per Fund I pace; 18–24 months for Fund II given larger size Portfolio construction: - Average check size: $100k–$500k target; $250k blended average - Number of investments: ~27M / $250k avg = ~108 companies (upper range); or ~54 at $500k avg - Stage mix: ~33% Pre-Seed/Seed, ~33% Series A, ~33% Series B+ - Web3 allocation: ~20–25% of Fund II (up from ~11% in Fund I) - Follow-ons: mostly via SPVs, not from fund Return assumptions (all - no realized return data except Braintrust): - Power law portfolio: ~2% of investments return 50x+, ~5% return 10–50x, ~15% return 2–10x, ~78% return <2x or write-off (standard VC loss ratio heuristic) - Braintrust: 13.9x mark noted, but locked up 12 months - cash multiple unconfirmed - Blended MOIC target: 3–5x gross on fund (consistent with top-quartile seed/multi-stage fund) - Exit timeline: 5–7 years average to liquidity for typical investment Management company: - Annual management fee (years 1–4): $600k/yr (if $30M fund) - Annual management fee (years 5–10): $0 - GP operating expenses: ~$300–500k/yr (office, legal, admin, Packy salary - not stated) - Newsletter/media revenue (separate P&L): not modeled in fund entity - **Scenarios (Base / Bull / Bear - which variables flex):** - Base: $30M fund, 90 investments, 3.5x gross MOIC, ~12% net IRR to LPs - Bull: $30M deployed faster, 1–2 breakout web3/token investments (20x+), gross MOIC 6–8x - Bear: Market correction post-2021 (relevant given deck is from late 2021 peak), write-off rate 40%+, gross MOIC 1.5–2x; carry = $0; management co. burns through fee income - Flex variables: fund size, number of investments, blended check size, MOIC by stage cohort, web3 allocation %, exit timing - **Required sheets / outputs:** 1. **Assumptions** - fund terms, deployment schedule, portfolio construction 2. **Management Company P&L** - annual management fees, operating costs, GP net income years 1–10 3. **Portfolio Construction** - investment count by stage, average check, total deployed 4. **Return Waterfall** - gross portfolio proceeds by scenario → return of capital → preferred return (if any) → carried interest → net LP proceeds 5. **Fund KPIs** - DPI (distributions to paid-in), TVPI (total value to paid-in), RVPI (residual value to paid-in), gross/net IRR by year 6. **Carry Schedule** - GP carry $ by scenario, timing of carry realization 7. **Sensitivity** - MOIC vs. fund size; carry $ vs. gross MOIC ## Frequently asked questions ### Is the Not Boring Capital Fund II financial model free? Yes. The Not Boring Capital Fund II model is a free Excel download with live formulas. ### Can I change the assumptions? Yes. The workbook is editable and its live formulas recalculate when assumptions change.