Deal Abstract
Invest in PittMoss
Republic is a startup investing platform where you can invest as little as $10 in impactful startups
Eco friendly fertilizer that takes shredded paper waste and turns it into fertilizer. Good revenue and backed by celebrity angels.
Financials (VRB)
| Question | Notes |
|---|---|
| 1. Fundraising Target? | $297000 |
| 2. Fundraised So Far? | $218137 |
| 3. Pre-Money Valuation? | $7500000 |
| 4. Previous Year's Annual Revenue | $563821 |
| 5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash) | ~$-879163 |
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: Ambridge, PA |
| 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: Revenue grew from $408k to $503k |
| 5. Notable investors? | True: Mark Cuban |
| 6. Post-funding, will have 18 months of runway? | False: Only raised 4 months of runway |
The 7 Thiel Questions (Every Time Man Profits, Don't Dismiss Serendipity)
| Question | Score | Notes |
|---|---|---|
| 1. Engineering? | 4 | PittMoss fertilizer grew 50% more |
| 2. Timing? | 2 | Not sure why this is the right timing for PittMoss |
| 3. Monopoly? | 2 | Good revenue but have never heard of it |
| 4. People? | 3 | Good team |
| 5. Distribution? | 2 | Has to go through TrueValue and other garden care chains |
| 6. Durability? | 2 | No network effects or moats to fertilizer |
| 7. Secret? | 3 | Now is the time to create a eco friendly fertilizer and get venture sized returns |
What has to go right for the startup to return money on investment:
1. Get more distribution; 2. Brand effectively to farmers; 3. Identify whether B2B or B2C is a better business
What the Risks Are
1. Fertilizer is not venture backable; 2. Requires distribution partners; 3. 50% improvement not a 1000% improvement
Bonus Muhan's Notes
Beautiful and will have to try it out
Updates
This is where I’ll post updates about the company. This way all my notes from offering to post-offering updates will be on one page.
Review these deal memos every time the startup raises a new round
Test if original thesis still applies
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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.