Two cofounders bought a struggling farm business and are now revamping it. Strange inconsistent financials that I need clarity on.
|1. Fundraising Target? |$1070000|
|2. Fundraised So Far?|$376416|
|3. Pre-Money Valuation?|$18500000|
|4. Previous Year's Annual Revenue |$0|
|5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash) |~$0|
The 6 Calacanis Characteristics ("Sow Passion, Not easy mediocrity", or S2 P6 N18)
|1. A startup that is based in SV?||False: Belvidere, NJ|
|2. Has at least 2 founders?||True: Two|
|3. Has product in the market?||False: No revenue|
|4. 6 months of continuous user growth or 6 months of revenue?||False: See above|
|5. Notable investors?||False: Bootstrapped|
|6. Post-funding, will have 18 months of runway?||True: No burn because no operations|
|1. Engineering?||1||Not sure where the engineering difference is|
|2. Timing?||1||Why is now the opportune time to start this business?|
|3. Monopoly?||1||No revenue|
|4. People?||2||Cofounders have worked before but no prior obvious success|
|5. Distribution?||2||Seems to have good distribution|
|6. Durability?||2||High capex to break into business but otherwise a commodity|
|7. Secret?||1||Now is the time to start a technology enabled unicorn business in growing produce?|
What has to go right for the startup to return money on investment:
1. Generate revenue; 2. Build out distribution that is directly with consumers; 3. Enter other higher margin businesses
What the Risks Are
1. Financial structure; 2. Commodity no innovation; 3. Not venture backable
Bonus Muhan's Notes
Lettuce learn more :)
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
Notice trends in how you think
So, did I invest?Click here to find out.
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