Rasa Deal Memo (Closing Date: 2022-02-28)

Muhan Zhang -

Deal Abstract

Invest in Rasa: The first functional coffee alternative: energize with adaptogens, not caffeine! | Wefunder
The first functional coffee alternative: energize with adaptogens, not caffeine!
Rasa on Wefunder

Bootstrapped $5m run rate alternative coffee company is raising money to give Four Sigmatic a run for their money.

Financials (VRB)

Question Notes
1. Fundraising Target? $5000000
2. Fundraised So Far? $2914528
3. Pre-Money Valuation? $25000000
4. Previous Year's Annual Revenue $2502241
5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash) ~$32030
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: Boulder, CO
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: Doubled revenue from 2019 to 2020
5. Notable investors? False: No one I recognize
6. Post-funding, will have 18 months of runway? True: Profitable!

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

Question Score Notes
1. Engineering? 2 Better than coffee, allegedly
2. Timing? 2 Lots of demands for alternative healthy drinks now
3. Monopoly? 3 Solid revenue, but I wonder if this is a smaller version of Four Sigmatic coffee
4. People? 3 Really strong team with solid performance to boot
5. Distribution? 2 Not sure how they're distributing but they got to $5m run rate
6. Durability? 1 My main question, is this just another mushroom coffee business?
7. Secret? 2 Mushroom and adaptogenic beverages are enough to make this company the Pete's Coffee of mushroom coffee

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

1. Keep branding Rasa as a premium beverage; 2. Get into more distribution; 3. Develop further proprietary blends

What the Risks Are

1. There are other mushroom coffee companies with bigger brands and more dollars; 2. The market isn't growing that fast for this beverage; 3. This is a product not a business

Bonus Muhan's Notes

Updates

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