Vetted developer agency is raising money to build more remote friendly websites for various startups, such as Campus Concierge or MealPal.
|1. Fundraising Target?||$5000000|
|2. Fundraised So Far?||$331634|
|3. Pre-Money Valuation?||$80000000|
|4. Previous Year's Annual Revenue||$2250406|
|5. Previous Year's Annual Net Income (+ Profitable, - Burning Cash)||~$-62245|
The 6 Calacanis Characteristics ("Sow Passion, Not easy mediocrity", or S2 P6 N18)
|1. A startup that is based in SV?||False: New York, NY|
|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: Grew from 1.6m in 2019 to 2.2 in 2020|
|5. Notable investors?||False: No one I recognize|
|6. Post-funding, will have 18 months of runway?||True: Very low burn|
|1. Engineering?||1||Seems like a vetted marketplace, which is great, but not a new engineering concept|
|2. Timing?||2||Good time for remote developers|
|3. Monopoly?||1||Good revenue for marketplace, but not as good as say, TopTal|
|4. People?||2||Good team, with CEO having background at Monster|
|5. Distribution?||3||Impressed by some of the customers this team has gotten|
|6. Durability?||2||I believe the supply is durable, if not growing at a tepid pace|
|7. Secret?||2||Building a verified marketplace for developer services right now is a venture sized business|
What has to go right for the startup to return money on investment:
1. Grow beyond just a service business; 2. Maintain quality at scale; 3. Systematize getting large clients and increasing lifetime collaboration
What the Risks Are
1. Service business not VC backable; 2. Marketplace can't compete against Toptal or Thumbtack; 3. No-code reducing demand for traditional dev agencies
Bonus Muhan's Notes
I know MealPal, very curious to know how Upstack go this customer.
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 firstname.lastname@example.org and let me know.