ThisWay (August 2020)

Deal Abstract

HR platform company that claims to be able to use AI to make sure all candidates are being considered fairly. Burned $1.8MM to make $200k in revenue. Coming in at $25MM valuation and claims Amazon as an investor.

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Decision

Pass

Why Investing/Passing

Valuation Too Large: $25MM
Amazon as Investor?: Can’t verify that Amazon is invested in the company.
Burning Too Quickly: Burned $1.8MM generating $208k in revenue. That’s an astounding ratio.

The 6 Calacanis Characteristics (91 161 18)

Check	Yes/No
1. A startup that is based in SV	No: Austin, TX
2. Has at least 2 founders	No: 1
3. Has product in the market	Yes
4. 6 months of continuous user growth or 6 months of revenue.	Yes: 2018 rev was 97k and 2019 rev was 208k.
5. Notable investors?	Yes: allegedly Amazon, but I’m seeing no evidence
6. Post-funding, will have 18 months of runway	False: 2019 burn was $1.8MM, raised 1,070k, so only 7 months.

The 7 Thiel Questions (ETMPDDS)

The Engineering question:
- Didn’t Bother
The Timing question:
- Didn’t Bother
The monopoly question:
- Didn’t Bother.
The people question:
- Didn’t Bother.
The distribution question:
- Didn’t Bother.
The durability question:
- Didn’t Bother.
*What is the hopeful secret?:
- Didn’t Bother.

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

N/A

What the Risks Are

N/A

Muhan’s Bonus Notes

Not a good use of time to explore intellectual biases when $25MM valuation on $1.8MM burn and $200k revenue. Cannot confirm Amazon is investing. Did not see financial statements.

CEO responded to my questions here: https://wefunder.com/comments/103609

Financials (References)

Current Fundraised: $1M
Valuation: ~25MM

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.