Austin Flipsters Deal Memo (Closing Date: 2021-07-16)

Muhan Zhang -

Deal Abstract

Invest in Austin Flipsters Portfolio
Republic is a startup investing platform where you can invest as little as $10 in impactful startups
Republic

YouTube celebrity house 'flipsters' Lauren and Lincoln are crowdfunding for their next real estate portfolio. They will take a 50% profit of all carry, no management fee.

Financials (VRB)

Question Notes
1. Fundraising Target? $500000
2. Fundraised So Far? $500000
3. Pre-Money Valuation? $0
4. Previous Year's Annual Revenue $0
5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash) ~$0
Source

The 6 Calacanis Characteristics ("Sow Passion, Not easy mediocrity", or S2 P6 N18)

Criteria Yes/No
1. A startup that is based in SV? False: Austin, TX
2. Has at least 2 founders? True: Two
3. Has product in the market? False: Doesn't appear so
4. 6 months of continuous user growth or 6 months of revenue? False: No revenue
5. Notable investors? False: N/A
6. Post-funding, will have 18 months of runway? True: No burn
Source

The 7 Thiel Questions (Every Time Man Profits, Don't Dismiss Serendipity)

Question Score Notes
1. Engineering? 1 No innovation
2. Timing? 4 Austin is on the rise
3. Monopoly? 1 Real estate is not winner take all
4. People? 4 Really strong team and media presence
5. Distribution? 1 No need for distribution really
6. Durability? 5 Houses are houses are houses
7. Secret? 1 Austin's real estate market is going to keep growing

What has to go right for the startup to return money on investment:

1. Austin continues to grow at high pace; 2. Media and unfair access to dealflow continues to be proprietary; 3. Team continues to execute on MBA level professionalism against casual landlords

What the Risks Are

1. Def will not be a billion dollar company

Bonus Muhan's Notes

Super cool. I obviously write more about startup investing, but real estate investing + media is another combination of my fields.

Updates

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Other thoughts, questions, comments, or concerns? Write me at mail@muhanzhang.com and let me know.