Deal Abstract

Education platform providing just-in-time reference and tips to healthcare professionals. Backed by Y-Combinator, $900k in revenue to date. Burn is $120k and raised 8 months of runway to try and 2x revenue and clients by Q2 2021.

Shoutout to A.S. for the tip!



Why Investing/Passing

  1. Valuation Too High/Company Too Mature: I’m looking for companies sub-$10 million valuation.
  2. Health Tech Not My Jam: I’m not bullish on medical organizations being motivated to adopt the newest, most efficient technology at a very rapid pace. That said, maybe COVID changes the equation.
  3. Seems More a Sales Play than a Technology Play: Solid business but uncertain it’s venture backable.

The 6 Calacanis Characteristics (91 161 18)

1. A startup that is based in SVYes: Oakland, CA
2. Has at least 2 founders Yes: 2
3. Has product in the market Yes
4. 6 months of continuous user growth or 6 months of revenue.Yes: See revenue and growth chart from team.
5. Notable investors?Yes: Y-Combinator
6. Post-funding, will have 18 months of runway No: Burn is $120k/mth, fundraised $1,070k which is 8-9 months.

The 7 Thiel Questions (ETMPDDS)

  1. The Engineering question:
    • Uncertain: Not sure their EdTech solution is that much better than existing technology. That said, they can sell..
  2. The Timing question
    • Fine: COVID and the like.
  3. The monopoly question
    • Good: Could scale quickly, impressive stats about time to deployment.
  4. The people question: 
    • Good: CEO and CTO are strong.
  5. The distribution question
    • Good: Selling to hospitals is hard, and the CEO is a former medical director.
  6. The durability question
    • Good: selling to hospitals is hard but very defensible.
  7. *What is the hopeful secret?: 
    • Charging money for a hospital edtech solution is a large, scalable business.

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

  1. 100x Revenue: In April 2020, valuations for SaaS companies was ‘the median public SaaS company valuation multiple stands at 8.2 times ARR.‘ In other

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