MyndVR Deal Memo (Closing Date: 2021–04–21)

VR company is building hardware/software/production house for VR experiences for the elderly. Strong recurring revenue for selling to elder care communities.

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

Deal Abstract

VR company is building hardware/software/production house for VR experiences for the elderly. Strong recurring revenue for selling to elder care communities.

Financials

1. Fundraising Target? $1070000
2. Fundraised So Far? $73129
3. Pre-Money Valuation? $8000000
4. Previous Year’s Annual Revenue: $139781
5. Previous Year’s Annual Net Income (+ Profitable, — Burning Cash): $-703321

Six Calacanis Criteria

1. A startup that is based in SV? False, Flower Mound, TX
2. Has at least 2 founders? True, Two cofounders
3. Has product in the market? True, Revenue generating
4. 6 months of continuous user growth or 6 months of revenue? True, Rev grew from 59 to 139k
5. Notable investors? True, Capital Factory def a regional player, HTC is a faded glory kind of deal (HTC Vive?)
6. Post-funding, will have 18 months of runway? True, Just at 18 months if $1m raised

Seven Thiel Tests

1. Engineering? 2, Company that is allegedly developing hardware and software, but why this company over Oculus?
2. Timing? 3, Hard to get better timing than COVID
3. Monopoly? 3, Good traction
4. People? 2, Company has solid media backgrounds but no hardware chops
5. Distribution? 3, Selling to retirement homes the real gem here
6. Durability? 3, Focusing on building a brand for
7. Secret? 3, Old people, with money, in large quantities, are going to get their kicks through virtual reality

What Has to Go Right

1. Old people have to not be luddites; 2. Get really good at both hardware and software, and figure out what the core business is here; 3. Don’t incur high servicing costs

What Could Go Wrong

1. Does the market want this? What’s prevented Vive/Oculus/Google Cardboard to take this to market? 2. Attacking media, software, and hardware could mean lack of focus; 3. Market is not growing fast enough

Muhan’s Bonus Notes

Very, very cool. Hope they can crack this market.

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/MyndVR
3. Want me to cover your startup? Submit your ‘Request for Startup’ (RFS) submission here: https://airtable.com/shrzNK8tguH8qEUF6

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