Deal Abstract

Hardware/game studio combo wants to become the Peloton/Ready Player One for real. Already has shipped over 4000 units to 500 venues in 45 countries. Doubled revenues in the last year, with over $10m worth of product sold.

The 6 Calacanis Characteristics ("Sow Passion, Not easy mediocrity", or S2 P6 N18)

Criteria Yes/No
1. A startup that is based in SV? No: Austin, TX
2. Has at least 2 founders? No: Looks like just the CEO has 5.5m shares on teh cap table
3. Has product in the market? Yes
4. 6 months of continuous user growth or 6 months of revenue? Yes: $3.8m vs. $1.6m
5. Notable investors? Yes: Mark Cuban, Capital Factory (same as Hidrent,) with twenty other VC's. Notably, no big VC's that I know.
6. Post-funding, will have 18 months of runway? Yes:Targeting $10mm, $3.5mm burn in 2020 (incomplete year,) which is 34 months of runway.
Virtuix Cap Table
Virtuix Consolidated Financial Statements
Virtuix Consolidated Financial Statements

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

Question Score Notes
1. Engineering? 5 Seems phenomenal
2. Timing? 5 Lots of people staying in doors for COVID
3. Monopoly? 5 Not sure I know any other product in the immersive home VR space
4. People? 3 Good that CEO isn't just a product guy, but neither leadership has experience in selling consumer electronics, game studio development, and not too much said about other teammates.
5. Distribution? 4 1 million email list! Direct to consumer woohoo.
6. Durability? 2 Thinking of the other VR headsets I know, e.g. Facebook Oculus, Microsoft HoloLens, etc. Uncertain which part of this company is their unfair advantage. Steam?
7. Secret? 4 This company has solid progress with selling hardware B2B, but jury's out on whether they can Nintendo that into home console system.

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

  1. Bring Product to Consumer Market: Not only

Want to read the whole post?

You don't have access to this post on Startup Investing for All by Muhan Zhang at the moment, but if you upgrade your account you'll be able to see the whole thing, including comments, as well as all the other posts in the archive! Subscribing only takes a few seconds and will give you immediate access.