Firstbase.io Deal Memo (Closing Date: 2021-05-07)

Muhan Zhang -

Deal Abstract

Invest in Firstbase.io (YC W21): Helping companies incorporate in the US, from anywhere in the world. | Wefunder
Helping companies incorporate in the US, from anywhere in the world.
Firstbase.io (YC W21) on Wefunder

Helping startups incorporate from anywhere in the world. Building business-in-a-box solution that allows startups to focus less on legal stuff and more on the building the product.

Financials (VRB)

Question Notes
1. Fundraising Target? $5000000
2. Fundraised So Far? $545000
3. Pre-Money Valuation? $40000000
4. Previous Year's Annual Revenue $2400000
5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash) ~$
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: New York, New York
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: 20% MoM, $200K+ in monthly revenue
5. Notable investors? True: Y Combinator, Earnest Capital, Amino Capital
6. Post-funding, will have 18 months of runway? False: No financials on burn

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

Question Score Notes
1. Engineering? 2 Seems fine, but is a YC startup version of Stripe Atlas
2. Timing? 3 Good time for remote work
3. Monopoly? 3 Good revenue but the fact that there is still no burn comments after a month of upload is concerning
4. People? 3 Team seem fine but pretty standard bunch of YC Bros
5. Distribution? 2 How will this company beat the competition on distribution? I've never heard of them
6. Durability? 2 Platform for regulation and filing
7. Secret? 1 Firstbase can beat Stripe Atlas and all the other US-Incorporation-As-A-Service companies

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

1. Upload financials so we can dive into the heart of the business; 2. Address a niche in intl registration that Atlas does not do; 3. Drive recurring value for recurring revenue platform

What the Risks Are

1. Copy-cat competition; 2. No meaningful differentiation; 3. Leadership has not addressed financials or answered questions on WeFunder.

Bonus Muhan's Notes

Need to see financials. $$$$$$$$$$$. Originally submitted on 4/6/21.

Updates

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Other thoughts, questions, comments, or concerns? Write me at mail@muhanzhang.com and let me know.