Weekly Roundup: Snack Money 🪙

Happy Friday, DVC! You’ve might have heard that

While parents are understandably outraged, I’m relieved. Lunchables’ elite status as a Snacktime Store of Value finally makes sense when you realize it’s the world’s only currency backed by hard commodities and precious metals.

DVC Deal Review #79 Summary & Weekly Poll:

Over the past 2 weeks we looked at Offline - a startup building a monthly subscription to help customers find unique local restaurants!

Sadly for Offline, DVC’s Investing Members collectively decided not to fund an investment in the company’s current Wefunder campaign.

It was a surprising result. By most metrics, Offline seems like a very solid deal (Note: not financial advice). It has a novel business model, is expanding fast in new cities, and is raising at a reasonable increase in valuation from its oversubscribed $2M round in 2022. DVC was cut out of that round, so our members were excited to get a second chance.

But, that’s about where the community excitement stopped. Despite our best efforts, the founder (politely) declined a webinar with DVC, citing a heavy workload with their rapid expansion and the fact that individual calls are typically for Angels/VCs considering large investments.

The founder gave helpful responses to our questions, but ultimately DVC’s Investing Members said “We’re out!” on this one…

Note: If you invested in Offline, feel free to (confidentially) share why here. It will help us gauge the Club’s sentiment for future deals.

“The RegCF Incentive Gap”:

This speaks to what is, in our opinion, one of the biggest challenges in RegCF: the incentive gap between founders and investors.

On the founder side, time is almost as precious of a resource as the previously-mentioned Lunchables. A founder’s efforts can make or break a company, so prioritizing the highest-impact tasks makes sense. Simply, why interact with a small customer when you could be pitching a VC? It might hurt to admit, but it’s valid.

On the investor side, it’s crucial to recognize that we’re operating at a significant disadvantage to VCs. The average investor can’t sit across the table from a founder and ask nuanced questions. They can only base their decisions off the campaign pages, SEC filings, and whatever the founder chooses to share in the Q&A section.

It’s “imperfect information”, which makes it hard to make informed choices.

So what’s the solution?

We’re confident founders will see over time that truly leaning into the community side of RegCF creates more supporters, revenue, and brand value than is visible in the short-term. But, in the meantime there are plenty of subtle clues you can add to your diligence process, including:

• How detailed are the Q&A responses a founder provides? Do they address or evade the questions? What is their tone?

• Does the company proactively share information with the crowd? Or, do they only share info when asked?

• How willing is the company to spend time with potential “small” investors?

They’re small details, but in our opinion they can help you determine a company’s level of commitment and respect for its customers and community.

But of course, we could be biased… help us test our ideas with the poll below!  

Last Week’s Results:

Last week we asked what type of newsletter/community content you’d like to see more of… and 57% of you said “investing resources (templates, how-to guides, etc.)”!

We hear you 🫡 Stay tuned…

Vote for New Deals:

Help select DVC's future deals! Please view the options, upvote your favorites, and suggest your own!

New companies suggested this week:

• Immigrant Food

DVC Portfolio Updates:

Overplay (Deal #55) - Story Time:

Overplay is back on the road (did they ever leave?) promoting the company, its Wefunder campaign, and its path ahead! Co-Founder Caroline Strzalka’s article on the company’s backstory was featured in BuiltIn, and the team will soon take part in fireside chats at the Penn Club of New York and the Wharton Alumnae Association! See and register here.

Qnetic (Deal #40) - Q1 Update:

Kinetic battery startup Qnetic checked in with a promising status report in its Q1 update! Notably, the company hired a finance and ops lead as its 9th employee, secured a new workshop to build its “Vega” rotor prototype, and will build and perform initial prototype tests in Q2! See full update.

Thank you for reading & participating! Have a great weekend and see you for a new DVC Deal Review next week!

Sincerely,

Team DVC