Managed marketplace for inspections. Has good revenue, vendor pool, and contracts, but makes one wonder will this market grow fast enough to be venture backable.
|1. Fundraising Target?||$1070000|
|2. Fundraised So Far?||$41000|
|3. Pre-Money Valuation?||$10000000|
|4. Previous Year's Annual Revenue||$55548|
|5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash)||~$-456243|
The 6 Calacanis Characteristics ("Sow Passion, Not easy mediocrity", or S2 P6 N18)
|1. A startup that is based in SV?||False: Brooklyn, NY|
|2. Has at least 2 founders?||True: Two|
|3. Has product in the market?||True: Revenue generating|
|4. 6 months of continuous user growth or 6 months of revenue?||True: Grew from 0 to $55k|
|5. Notable investors?||True: Y-Combinator and Urban.us|
|6. Post-funding, will have 18 months of runway?||True: Yes, but needs $750k roughly|
The 7 Thiel Questions (Every Time Man Profits, Don't Dismiss Serendipity)
|1. Engineering?||2||Managed marketplace a la a16z|
|2. Timing?||2||Is this a time when demand for this service goes exponential?|
|3. Monopoly?||2||150 inspections with 1000 inspectors generating $150k in rev, not bad|
|4. People?||2||People seem fine|
|5. Distribution?||2||See the 150 inspections, $150k in revenue|
|6. Durability?||3||Very durable, assuming this managed marketplace is important|
|7. Secret?||3||As leaders at organizations age out and younger leaders come in, the marketplace for inspections and inspectors will become increasingly more digital|
What has to go right for the startup to return money on investment:
1. Scale revenue; 2. Consistently identify and find the right decision maker at companies that need inspections; 3. Navigate the marketplace/SaaS model correctly
What the Risks Are
1. Market is too niche/not growing fast enough; 2. Other networks will also start developing and you'll end up getting regional networks; 3. SaaS is being competed against on other side as well a la https://muhanzhang.com/optelos/
Bonus Muhan's Notes
Very cool company, though it makes me wonder how venture backable this sector is.
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Review these deal memos every time the startup raises a new round
Test if original thesis still applies
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