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?

📈 Yesterday I gave a talk about how to get customers through Programmatic SEO (& launched this cohort-based course).

📧 The Split from Turner Novak, a weekly newsletter for founders going deep on one topic, followed by helpful charts and links.

👂 AngelList’s CEO talks about today’s funding markets, how they’re using AI, and more.

😮 Tibo discusses how Justin Welsh makes $2M a year with 0 employees.

🧠 Packy McCormick writes on why Google’s monopoly is in an uncomfortable position for the first time in 25 years.

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What happened this week?

🤖 Stability AI launches StableLM, an open-source ChatGPT alternative.

🚀 Savings app Super.com raises $85M in a Series C round.

👎 1200 Lyft employees are set to be laid off as the company looks to reduce costs.

💰 Vice Ventures raises $25M to fund startups in ‘controversial’ industries.

👨‍💻 Google gives Bard the ability to generate and debug code.

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Failed startup story: Vicis

Vicis, a Seattle-based startup that developed innovative protective football headgear, ceased operations in 2020. Their helmets were used by numerous professional, college, and high school football teams.

Vicis had successfully raised more than $85M in funding, attracting investments from high-profile NFL quarterbacks like Alex Smith and Aaron Rodgers.

In Between the Lines:

Despite its initial success, Vicis reportedly faced closure and laid off 84 employees due to cash-flow issues and its inability to attract sufficient capital to remain in business.

A critical factor contributing to the startup's failure was the excessive time and effort dedicated to fundraising, detracting from essential business operations. Co-founder and chief executive Dave Marver mentioned in an email to the New York Times, "We were more successful than most at raising capital, but it took a tremendous amount of time and effort, an effort that could have been applied to growing and running the business."

Lessons Learned:

A key lesson to be learned from Vicis' experience is the importance of efficiently balancing fundraising and business operations.

When running a startup, things can get busy, and raising capital becomes a top priority to maintain operations. However, it shouldn't take precedence over running the business.

This balance can be achieved through effective time management, leveraging technology to optimize and automate internal processes, or seeking external support when needed. By maintaining this balance, startups can avoid neglecting core business operations while still securing the necessary capital for growth and success.

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Hot startup of the week: Hawkr

​Hawkr is a UK-based music merchandise startup that offers a print-on-demand service for artists to sell merchandise directly to fans during concerts.

The company recently raised a seed funding round of £260,000 to enhance its service, sign more music industry partnerships, and expand its reach.

In Between the Lines:

While print-on-demand itself is not a new concept, Hawkr has innovated by tailoring the business model specifically to the music merchandise industry.

The Hawkr platform replaces traditional physical merchandise stands with digital merch stands customized for each concert.

This approach eliminates the need for artists to print large quantities of T-shirts in advance, which may not always sell out. Furthermore, artists gain increased flexibility by offering a wider variety of designs and merchandise options, providing fans with more choices.

Lessons Learned:

An important takeaway is that a startup doesn't have to be the next Facebook, Airbnb, or Uber to be successful. Hawkr demonstrates how utilizing an existing business model, such as print-on-demand, can effectively address a specific problem.

It is common for aspiring entrepreneurs to focus on discovering the next groundbreaking tech company (which is okay!). However, it is crucial to remember that addressing niche issues and improving existing models can also lead to successful and sustainable businesses!

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What do you think of today's newsletter?

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Cheers,

Nico