Deal Abstract

Boxabl
Mass Production Building System

Innovative construction company is building a new Boxabl home. Can they take the product to market?

Financials (VRB)

Question Notes
1. Fundraising Target? $3000000
2. Fundraised So Far? $3925405
3. Pre-Money Valuation? $226000000
4. Previous Year's Annual Revenue $90000
5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash) ~$-1162792
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: Las Vegas, NV
2. Has at least 2 founders? True: Two
3. Has product in the market? False: 'We are currently launching a 170,000 square foot factory with the capacity to produce thousands of easily shippable homes and millions in revenue.'
4. 6 months of continuous user growth or 6 months of revenue? True: Though revenue growth from 2019 to 2020 super modest
5. Notable investors? False: No one I recognize
6. Post-funding, will have 18 months of runway? True: Needed ~$2mm and already fundraised past that
Source

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

Question Score Notes
1. Engineering? 3 Interesting engineering, but not sure how this beast prefab homes
2. Timing? 2 Construction costs not going down
3. Monopoly? 1 No market share presently as far as I know
4. People? 2 Good team but no one has lead a construction startup yet
5. Distribution? 2 Sell directly to customers? B2B?
6. Durability? 4 Basically as durable as you can get, unless someone gets a more innovative materials sciences patent
7. Secret? 2 New housing costs are going to be Boxabl homes instead of prefab/3d printed/any of the traditional construction ways

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

1. Deliver product at scale; 2. Figure out margins; 3. How is it that Boxable homes don't need to plug into utiliites?

What the Risks Are

1. Construction innovation super challenging; 2. Become full-stack provider of customer service in addition to being a manufacturer not easy; 3. Going to market and making sure margins stay competitive while risk of innovation doesn't incur additional costs

Bonus Muhan's Notes

Need to figure out more about the innovation, seems a little too good to be true

Elon Musk reportedly lives in a $50,000 prefab tiny home that already has a 100,000-unit wait list — see inside a unit
Boxabl had a wait list of about 40,000 people before the Musk rumors began. Now, its list has jumped to 47,000 who want more than 100,000 tiny homes.

Updates

This is where I’ll post updates about the company. This way all my notes from offering to post-offering updates will be on one page.

Review these deal memos every time the startup raises a new round

Test if original thesis still applies


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