Deal Abstract

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High tech bio company has made a better mammogram detecting solution.

Financials (VRB)

Question Notes
1. Fundraising Target? $5000000
2. Fundraised So Far? $1471157
3. Pre-Money Valuation? $200000000
4. Previous Year's Annual Revenue $3089624
5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash) ~$-1135428
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: Norcross, GA
2. Has at least 2 founders? False: Two
3. Has product in the market? True: Revenue generating
4. 6 months of continuous user growth or 6 months of revenue? True: Went from $2m to $3m
5. Notable investors? False: No one I recognize
6. Post-funding, will have 18 months of runway? True: Just needs $2m or so

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

Question Score Notes
1. Engineering? 3 Great engineering
2. Timing? 2 Not sure why this is the right time for this company to take off
3. Monopoly? 2 Solid revenue but at $200m that $2m revenue is a high valuation
4. People? 2 Seems like right people
5. Distribution? 2 Distribution needs to be through partners, or as they say, luminary sites
6. Durability? 4 Super hard tech moat
7. Secret? 2 Exponential adoption of superior technology for mammograms is awaiting once this device goes full on the market

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

1. Get more site partners to buy this; 2. More doctors and more frequent mammograms due to ease, accuracy, and cost; 3. All components of the device including software are revenue streams

What the Risks Are

1. Biotech always makes me nervous; 2. The valuation is very, very high; 3. Adoption could be slow as how often do people get mammograms

Bonus Muhan's Notes

Very cool

Updates

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