Deal Abstract
In the months following Fleeting, a new trucker-on-demand marketplace has emerged with higher revenue, lower valuation, but also, smaller team and less institutional investors. Who will win the Uber for trucker driver war?
Financials (VRB)
|Question|Notes|
|---|---|---|
|1. Fundraising Target? |$1070000|
|2. Fundraised So Far?|$195715|
|3. Pre-Money Valuation?|$8000000|
|4. Previous Year's Annual Revenue |$461117|
|5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash) |~$-229101|
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: Norco, CA |
| 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: Impressive growth from 2018 to 2019 |
| 5. Notable investors? | False: No one I recognize |
| 6. Post-funding, will have 18 months of runway? | True: Needs $400k |
The 7 Thiel Questions (Every Time Man Profits, Don't Dismiss Serendipity)
| Question | Score | Notes |
|---|---|---|
| 1. Engineering? | 2 | Better than nothing, but curious to compare to Fleeting |
| 2. Timing? | 2 | Is now the right time to start a truck driver labor aggregation platform? |
| 3. Monopoly? | 4 | Incredible revenue of $2m ARR on $8m valuation |
| 4. People? | 2 | Good founder though he doesn't appear to have much of a team |
| 5. Distribution? | 3 | Definitely able to sell/build the two sided marketplace |
| 6. Durability? | 1 | This is what I don't know. Need to ask about Fleeting. |
| 7. Secret? | 2 | Relay will be able to build a faster two sided marketplace than Fleeting. |
What has to go right for the startup to return money on investment:
1. Build faster and get tight network effects; 2. Scale a team to get more aggressive customer acquisition; 3. Anticipate the coming trucking automation and figure out how to get ahead
What the Risks Are
1. Over half a year later than Fleeting, which has star studded investors; 2. Trucking automation; 3. Payroll expense for 2019 was only 133k which means two employees, so I wonder if they'll be able to compete against Fleeting's team size
Bonus Muhan's Notes
Very, very cool. $2m ARR to $8m valuation may be one of the strongest revenue businesses I've seen. Going to ask the founder some key questions.
Updates
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