Deal Abstract

Dock to doorstep e-commerce play for Get Maine Lobster (Black Point Seafood.) This is a retroactive deal memo. Sought to raise $1MM, minimum $450k, at a $9MM valuation. Another example of a straightforward e-commerce business model raising crowdfunding money in an unorthodox way.



Why Investing/Passing

  1. E-commerce is the right way to do this business, but raising money in equity form to spend more on marketing seems unnecessary.
  2. The business is built to scale, but I don’t see the consumption of seafood as a suddenly rapid growing business.
  3. It took 9 years to grow to an estimated valuation of $9MM.

The 11 Calacanis Characteristics

Passed on 4/11.

1. Syndicate lead has >5 years investing and >1 unicorn investmentFail
2. A startup that is based in SVFail: (Portland, ME)
3. Has at least 2 founders Fail
4. Has product in the market Pass
5. 6 months of continuous user growth or 6 months of revenue.Pass
6. Notable investors?Fail
7. Post-funding, will have 18 months of runway Pass: this business is raising money to expand, not because it’s not profitable/sustainable.
8. Proprietary technology?Fail
9. Network effects?
10. Economies of scale?
11. Great branding?
Pass: fun brand

The 7 Thiel Questions

  1. The Engineering question:
    • Bad: this company is not 10x-ing anything. That said, they never purported to be.
  2. The Timing question
    • Bad: though it’s a good time to be starting online e-commerce business, there’s no reason to ask why this business is positioned for exponential growth at this moment.
  3. The monopoly question
    • Bad: nope. That said, although there are no reasons why another lobster shop couldn’t start an e-commerce arm, that doesn’t mean that those companies are any likely to want to change their business model.
  4. The people question: 
    • Good: the founders seem well positioned to execute on this.
  5. The distribution question
    • Good: got to love direct to

Want to read the whole post?

You don't have access to this post on Startup Investing for All by Muhan Zhang at the moment, but if you upgrade your account you'll be able to see the whole thing, including comments, as well as all the other posts in the archive! Subscribing only takes a few seconds and will give you immediate access.