Nerds from Boston raised (and burned!) an astounding amount of money to build an app for budgeting. Is this the future of banking?
|1. Fundraising Target? |$1070000|
|2. Fundraised So Far?|$1225313|
|3. Pre-Money Valuation?|$15000000|
|4. Previous Year's Annual Revenue |$0|
|5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash) |~$-1143644|
The 6 Calacanis Characteristics ("Sow Passion, Not easy mediocrity", or S2 P6 N18)
|1. A startup that is based in SV?||False: Boston, MA|
|2. Has at least 2 founders?||False: Two|
|3. Has product in the market?||True: Beta online|
|4. 6 months of continuous user growth or 6 months of revenue?||False: No revenue|
|5. Notable investors?||False: Lots of institutional accelerator free competition money|
|6. Post-funding, will have 18 months of runway?||False: Burning a lot of money|
The 7 Thiel Questions (Every Time Man Profits, Don't Dismiss Serendipity)
|1. Engineering?||2||Prettier app but nothing fundamentally different|
|2. Timing?||2||Good timing, but is this the right solution?|
|3. Monopoly?||1||20 ratings on App Store, nothing to write home about|
|4. People?||1||No one with banking experience|
|5. Distribution?||1||Downloading app to get users?|
|6. Durability?||2||It is a bank, so once someone starts with them should not switch easily|
|7. Secret?||1||Building a better UI/UX mobile app will make a superior bank|
What has to go right for the startup to return money on investment:
1. Develop a monetization strategy; 2. Acquire users; 3. Build a platform for tight integration via digital banking
What the Risks Are
1. Founders have no experience in banking; 2. What is the proprietary value add; 3. AI budgeting is not that useful of a feature
Bonus Muhan's Notes
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.
Other thoughts, questions, comments, or concerns? Write me at email@example.com and let me know.