Deal Abstract
Invest in Tempo
Republic is a startup investing platform where you can invest as little as $10 in impactful startups
Famous e-sports gamer leverages his brand, audience, and production studio to develop a full strategy card game.
Financials (VRB)
| Question | Notes |
|---|---|
| 1. Fundraising Target? | $1070000 |
| 2. Fundraised So Far? | $520189 |
| 3. Pre-Money Valuation? | $30000000 |
| 4. Previous Year's Annual Revenue | $2194514 |
| 5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash) | ~$-2315250 |
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: Long Beach, 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: Modest growth |
| 5. Notable investors? | False: No one I recognize |
| 6. Post-funding, will have 18 months of runway? | False: Needs $3m for 18 mth runway |
The 7 Thiel Questions (Every Time Man Profits, Don't Dismiss Serendipity)
| Question | Score | Notes |
|---|---|---|
| 1. Engineering? | 1 | No engineering, just a game development studio |
| 2. Timing? | 2 | Good time for e-sports |
| 3. Monopoly? | 3 | Great community |
| 4. People? | 5 | Honestly couldn't ask for a better team |
| 5. Distribution? | 5 | Fantastic distribution |
| 6. Durability? | 2 | It's a game studio/media company, not much differentiation |
| 7. Secret? | 1 | Game studios can make good venture bets |
What has to go right for the startup to return money on investment:
1. Launch game; 2. Print money and sell booster packs at high margins; 3. Focus on what makes money in the business
What the Risks Are
1. Split focus and attention, doing alot; 2. Videogames and media aren't venture backable; 3. Making a good game is one thing, making a crazy lucrative game is another thing
Bonus Muhan's Notes
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
Notice trends in how you think
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.