Deal Abstract
Modern Mint.com targeted to a premium user base wants to make money by charging you for a SaaS platform. Can they pull off a $130m exit a la Mint.com to Intuit?
Financials (VRB)
| Question | Notes |
|---|---|
| 1. Fundraising Target? | $1000000 |
| 2. Fundraised So Far? | $131000 |
| 3. Pre-Money Valuation? | $10000000 |
| 4. Previous Year's Annual Revenue | $0 |
| 5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash) | ~$0 |
The 6 Calacanis Characteristics ("Sow Passion, Not easy mediocrity", or S2 P6 N18)
| Criteria | Yes/No |
|---|---|
| 1. A startup that is based in SV? | True: San Francisco, CA |
| 2. Has at least 2 founders? | False: Two |
| 3. Has product in the market? | False: Pre-product |
| 4. 6 months of continuous user growth or 6 months of revenue? | False: Pre-revenue |
| 5. Notable investors? | False: First outside money |
| 6. Post-funding, will have 18 months of runway? | True: No net income |
The 7 Thiel Questions (Every Time Man Profits, Don't Dismiss Serendipity)
| Question | Score | Notes |
|---|---|---|
| 1. Engineering? | 2 | Slightly better Mint.com |
| 2. Timing? | 2 | More self admin investors |
| 3. Monopoly? | 1 | No market share |
| 4. People? | 2 | Good CEO but only dude |
| 5. Distribution? | 2 | No big brand name for adoption |
| 6. Durability? | 2 | Couldn't anyone with a Plaid developer account do this? |
| 7. Secret? | 2 | Self managed financial customers will pay money for a financial dashboard, or somehow this company beats Mint.com at their business |
What has to go right for the startup to return money on investment:
1. Capture a premium market a la Mint.com; 2. Go to market and monetize; 3. Find ways to make money besides just information and advisory, probably start to offer proprietary financial products at some point
What the Risks Are
1. Pre-revenue; 2. Nice to have not an urgent painkiller; 3. Still a one-man product not a business yet
Bonus Muhan's Notes
Love to see it but need to see more business fundamentals before believing this is worth $10m
Updates
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Review these deal memos every time the startup raises a new round
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So, did I invest?
Click here to find out.Other thoughts, questions, comments, or concerns? Write me at mail@muhanzhang.com and let me know.