GURU Deal Memo (Closing Date: 2021–04–30)

Engineer is building Jarvis for real-life engineers. Pre-product, pre-revenue, but with growth opportunity as with all startups.

Company Logo

Want to see the complete rich format deal memo? Read the original post at: https://muhanzhang.com/GURU

Deal Abstract

Engineer is building Jarvis for real-life engineers. Pre-product, pre-revenue, but with growth opportunity as with all startups.

Financials

  1. Fundraising Target? $1070000
  2. Fundraised So Far? $420494.84
  3. Pre-Money Valuation? $5984000
  4. Previous Year’s Annual Revenue: $0
  5. Previous Year’s Annual Net Income (+ Profitable, — Burning Cash): $-32500

Six Calacanis Criteria

  1. A startup that is based in SV? False, Los Angeles, CA
  2. Has at least 2 founders? True, Two
  3. Has product in the market? False, Raising to go to market
  4. 6 months of continuous user growth or 6 months of revenue? False, Not in market
  5. Notable investors? False, No prior investors
  6. Post-funding, will have 18 months of runway? True, No burn

Seven Thiel Tests

  1. Engineering? 2, Better but is it 10x better?
  2. Timing? 3, Technology becoming more complex, if it works this timing is good
  3. Monopoly? 1, Few customers, only 4 in beta
  4. People? 2, Seems like team is well, but the fact that financials are from 2017–2018 not promising
  5. Distribution? 2, How to distribute to these SMBs they’re talking about?
  6. Durability? 3, If they can build it, definitely stable
  7. Secret? 2, GURU can provide a smooth enough interface to commoditize sophisticated hardware computing power for SMBs

What Has to Go Right

  1. Launch a product publicly; 2. Monetize; 3. Actually solve real problem

What Could Go Wrong

  1. Lofty ambition, no product to demonstrate proof; 2. Complexity is very hard to solve, see Bubble and the no-code movement; 3. Business model risk, what would be the willingness to pay for this, even when the product is still not totally polished yet?

Muhan’s Bonus Notes

Real life Jarvis!

Investment Decision Teaser

So, did I invest?

  1. Subscribe to https://muhanzhang.com/ to see my final investment decisions, keep track of my portfolio, and receive ongoing updates on my journey to investing in 50 startups as an unaccredited investor.
  2. Read the rich format deal memo here: https://muhanzhang.com/GURU
  3. Want me to cover your startup? Submit your ‘Request for Startup’ (RFS) submission here: https://airtable.com/shrzNK8tguH8qEUF6

Other thoughts, questions, comments, or concerns? Write me at mail@muhanzhang.com and let me know.

Founder of Startup Investing for All, for angel investors seeking better turns, together. 1st employee and COO @Yang2020. Subscribe at www.muhanzhang.com

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