Deal Abstract

Pre-revenue media company wants to launch a membership/sponsored content production house for mobile first video news. Compelling value proposition, with some famous investors, but too early in the innovation cycle for me. Needs to become a platform/tech company to deliver venture returns.

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The 6 Calacanis Characteristics (91 161 18)

1. A startup that is based in SVNo: Brooklyn, NY
2. Has at least 2 founders No (1, but has Chief Product Officer)
3. Has product in the market No: only beta users, can’t download via app and didn’t want to give email to
4. 6 months of continuous user growth or 6 months of revenue.No: 2019 net revenue was $261.
5. Notable investors?Yes: Snap Accelerator, Biz Stone (co-founder of Twitter)
6. Post-funding, will have 18 months of runway Yes: They burned $82k in 3 months, or monthly burn of $26.6k meaning that a round $1m would get them 38.46 months of runway.
(Thanks to Yifan Tang for pointing out my slip-up!)

The 7 Thiel Questions (ETMPDDS)

  1. The Engineering question (Can you create breakthrough technology instead of incremental improvements?):
    • Bad: This is a tech-enabled media company
  2. The Timing question (Is now the right time to start your particular business?): 
    • Good: Move to mobile definitely make sense
  3. The monopoly question (Are starting with a big share from a small market?): 
    • Bad: Hard to gauge. Potentially good if talking about just mobile/story like video news, bad if talking about mobile news.
  4. The people question (Do you have the right team?): 
    • Average: Team has good experience on creating content, but I don’t see anyone with unfair advantages in monetizing media.
  5. The distribution question (Do you have a way to deliver your product?): 
    • Average: Direct to consumer through online ads, but neither founder has an enormous platform.
  6. The durability question (Will your market position be

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