Weekly Roundup: Brats

Happy Friday DVC!

Hope everyone had a great week! And a high five to the 11 new members! ✋ 

Whether you're a seasoned investor or just starting out, our goal is to provide valuable insights in Venture that help you make informed decisions and achieve outsized returns. Today, we’re going to focus on business model evaluation. But first:

Are you a Brat?

The Wall Street Journal posted an article this week about being a “brat.” For you Boomers, Gen Xers, and Millennials, apparently, being a brat is a “perspective on life” that means you enjoy living your life and don’t care what anyone else thinks. Heck, even Kamala Harris is getting swept up in the “brat” craze (see Overplay update below).

Perhaps the youth of today are right—we can’t relate to the “brat” perspective on life. However, what we can relate to is Mike Tyson’s perspective: “Everyone has a plan until they get punched in the face.”

Table of Contents

• Bitcoin ‘24 Conference Reflection

• Republic’s Pivot?

• QAI Scholarships Available! Act Fast!

• Venture Investing: Assessing a Business Model

• DVC Deal Review

• DVC Portfolio Updates

Bitcoin ‘24 Conference Reflection

• We attended the Bitcoin '24 Conference, where Presidential Candidates Donald Trump and Robert F. Kennedy were present. There were also last-minute discussions about Kamala Harris attending. This highlights Bitcoin's growing political influence, but the industry faces a significant education challenge, especially with Bitcoin often confused with the fraud-prone crypto sector.

• And for anyone that wants to know the most “Bullish” case for Bitcoin, Michael Saylor’s presentation is a must watch.

Republic’s Pivot?

• Republic, once considered one of the market leaders in the RegCF marketplace space, has since taken a back seat to Wefunder and StartEngine in terms of transaction volume. The question is why? Well, this week, the CEO, Kendrick Nguyen posted a “reflection” on the first 8 years of the company and where it’s heading. It’s pretty clear that they are putting all of their energy into tokenization. Read the post here.

QAI Scholarships Available! Act Fast!

We get it!!!! Education isn’t sexy, but being highly sophisticated investor or founder is. If you are serious about being excellent in venture, then register for the next QAI Cohort (beginning the week of August 12). Send a note to [email protected] and say “I WANT MY QAI” and we’ll cover a sizable cost of the program! Only 5 scholarships are available “and” the program is flexible enough to work within your busy schedule! All live sessions will be recorded. www.beqai.com 

Venture Investing: Assessing a Business Model

By: Gerry Hays

For the past several weeks, we’ve discussed the three pillars of successful venture investing: 1) A Fertile mindset; 2) A Sound Strategy; and 3) Disciplined Execution.

During the execution phase of building your portfolio, you will be assessing the credibility of each investing opportunity to determine whether you’re investing in a deal (or not). Specifically, we concentrate on five broad areas:

1. Business Model

2. Team

3. Competitive Advantage

4. Market

5. Alignment

Today, we’re going to focus on the Business Model. The term "business model" in the context of QAI (Qualified Accredited Investor) refers to the framework or blueprint for how a company creates, delivers, and captures value. Overall, a strong business model should clearly articulate how a company plans to make money and provide value to its customers, which in turn helps investors make informed decisions about whether to back (or continue to back) the startup.

Breaking down a business model analysis using the QAI structure for different funding stages—pre-seed, seed, and Series A—requires understanding the criteria investors use at each stage. Specifically, an investor and a founder know far less at the pre-seed stage compared to the Series A stage. Therefore, one cannot apply a one-size-fits-all approach when evaluating the business model.

Here's a detailed breakdown of what to look for in a business model at the various stages:

Of course, this is a broad summary of what to look for at different stages, and the QAI Evaluation model offers a more detailed scoring system to help determine whether the business model aspect of the deal is credible. But this gives you a general idea of how to analyze a business model at various stages.

Next week, we’ll tackle how to evaluate the Team. And, if you have questions you’d like for us to answer, feel free to email them to [email protected] 

DVC Deal Review

For DVC Premium Members, the Sweater deal analysis is currently live!

DVC Portfolio Updates

Lexi (Deal #22) - Lexi, a company using IOT (Internet of Things) to retrofit commercial buildings to meet climate mandates, has moved their offering from Start Engine to Republic and lowered their minimum from $500 to $100. They are hosting a call on August 5 to discuss the transition. 

Holodia (Deal #27) - Holodia, a VR fitness app company, is touting the application of their technology, called Holofit, in senior living facilities. Early tests show that Holofit considerably increased the motivation of seniors to exercise. An interesting and promising use of the technology! Full update here.

Overplay (Deal #67) - Overplay, an app that can turn any video into a game, announced that they’ve surpassed $1MM in their most recent Wefunder campaign (from nearly 800 investors) and that Kamala Harris is a Brat gram is trending on the app, an indication that Overplay is ushering in a whole new market: meme-style games. Full update here. 

RadAI (Deal #9) - RadAI, a company using Artificial Intelligence to help companies boost revenue through integrated and measure marketing, announced that they’ve tripled revenue and are raising another round at a valuation of $74MM (a 400% increase from when we analyzed the deal).

Have a great weekend everyone!

Sincerely, Team Doriot