Deal Abstract

https://wefunder.com/makeba

Pre-revenue fintech company for emerging companies wants to be the PayPal/Square/Venmo/Braintree. Burned $1.1MM in 2018 and 2019, each, raising money at a $30MM valuation. Will only raise ~7 months of runway at present fundraising terms.

Shout out to reader John for forwarding me the deal!


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The 6 Calacanis Characteristics (91 161 18)

CheckYes/No
1. A startup that is based in SVNo: New York, NY
2. Has at least 2 founders No: 1 (CEO holds 86.2% of the equity.)
3. Has product in the market Yes
4. 6 months of continuous user growth or 6 months of revenue.Yes: Users grew from 688 to 3239 in six months.
5. Notable investors?No
6. Post-funding, will have 18 months of runway No: Burned $1.1MM in 2018 and 2019, each, currently raising max $700k which is 7.6 months of runway.

The 7 Thiel Questions (ETMPDDS)

  1. The Engineering question:
    • Bad: not seeing fundamentally any new technology.
  2. The Timing question
    • Uncertain: Good for fintech but this company is trying to be PayPal/Square/Venmo/Braintree for emerging markets and I’m not sure they’d do it besides better than the OGs.
  3. The monopoly question
    • Good: if they could actually build it, this would be great. But the level of capital to build this is far exceeding their non-existent revenue.
  4. The people question: 
    • Eh: Not seeing anyone with fintech experience prior.
  5. The distribution question
    • Bad: Marketing to consumers is straightforward, but getting businesses onboard not easy.
  6. The durability question
    • Good: if they could build it.
  7. *What is the hopeful secret?


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