Hey — It's Nico.

This newsletter contains:

• 5 resources for founders.
• 5 startup news.
• 1 failed startup.
• 1 hot startup.

This issue is brought to you by Bill:

It’s essential for small businesses to take practical steps to reduce the effects of inflation, short staffing, and other hurdles.

In BILL’s guide, Solving Business Challenges of 2023 with Automation, you’ll learn how automation can help your business minimize the impact of recent challenges.

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What to read this week?

✍️ Y Combinator partner Michael Seibel shares his 1 piece of advice for startups.

🧠 NFX shares a practical guide on what to include in investor updates.

🚀 Todd Jackson discusses Webflows' path to achieving Product Market Fit.

💵 How Lenny Rachitsky got 18K subscribers to pay for his newsletter.

💡 A practical guide to using Product-Led SEO in your business.

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What happened this week?

💰 Eclipse Ventures secures $1.2B across 2 funds for startups changing the physical world.

📈 Clear Street, a FinTech startup, raises $270M at a $2B valuation.

📱 Cash App founder Bob Lee dies in San Francisco.

🤖 Techcrunch provides Insights into Y Combinators 2023 winter batch.

👽 Bloomberg announce their own GPT Finance chatbot.

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Failed startup story: Starsky Robotics

Starsky Robotics, a self-driving trucking company that raised over $20M in funding, ceased operations in 2020.

The company believed it had a solid business model and had invested heavily in safety engineering. However, the company failed due to a lack of investor interest and funding.

The former CEO, Stefan Seltz, wrote an article explaining why the company shut down and offers valuable insights into AI and the trucking industry.

In between the lines:

In the article, Stefan mentioned that despite the company's efforts to build a successful business, investors had cooled on the autonomous trucking space. Additionally, he mentions that investors didn't value the heavy investment in safety that the company had made.

Starsky focused heavily on safety engineering, which was a critical feature. However, he believes this was invisible to investors who expected to see more visible AI features.

In the article, he also states trucking companies are not great technology customers and may not be receptive to such products. As a result, Starsky faced challenges in promoting its technology and achieving its growth objectives.

Lessons learned:

Starsky found the trucking industry may not have been ready for significant technological changes and that trucking companies were not ideal technology customers. Startups must analyze their industry and determine whether potential customers are prepared for their solutions.

Moreover, the article suggests that some investors don’t really care about safety; they like features. Startups should consider developing visible features that can captivate investors and showcase the potential of their technology. This is also relevant to customers, as they may not be interested in the intricate engineering behind the product.

Here’s a tip: Sell the outcome, not the product. Stefan highlighted that investors or even potential customers are generally uninterested in the technical aspects of a product. Instead, they want to know how the product can simplify people’s lives.

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Hot startup of the week: Aqua Cultured Foods

​Aqua Cultured Foods, a Chicago-based startup focusing on creating sustainable, cultivated seafood alternatives, announced a $5.5M seed round. The funding will help bring the company’s seafood alternative to the market.

Aqua Cultured Foods is differentiating itself by developing whole-muscle cut seafood alternatives, such as calamari, shrimp, scallops, and filets of tuna and whitefish, using proprietary mycoprotein (fungi) fermentation processes.

In between the lines:

Before launching the company, CEO Anne Palermo, was in the finance industry. However, she always had an interest in health and wellness, prompting her to go back to school to learn about product development and science.

After finishing her studies, she initiated a health snack company that used protein isolates to create exclusive formulations of high-protein snacks.

​In an interview with Techcrunch, she said, “It was really during the development of that product in particular that I got into the alternative protein set scene because it helped me to understand that there are a lot of alternative proteins that are not highly refined and do not come from animals.”

This commitment to acquiring relevant knowledge and skills helped her identify market opportunities and develop innovative solutions that address the challenges faced by the traditional seafood industry.

Lessons learned:

One crucial takeaway from Aque Culture Foods' recent funding round is the significance of continuous learning. Annie's shift from finance to health and wellness highlights the importance of gaining relevant expertise and abilities to thrive in a chosen field.

Entrepreneurs often have great ideas but may feel discouraged due to a lack of relevant skills or knowledge. However, Annie's experience emphasizes that it's acceptable to take your time and invest in further education. Doing so can equip entrepreneurs with the tools to make informed decisions, identify opportunities, and create innovative solutions.

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Cheers,

Nico