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  • Here Are the Top 50 Mistakes I’ve Seen Kill New Companies | Entrepreneur

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    I’ve seen many startups succeed, and many fail. I’ve consulted for and invested in lots of them. My previous startup, Anchor, navigated its own challenges and missteps; we were fortunate to survive them, and ultimately Spotify acquired the company in 2019.

    Over the years, I’ve come to think of startups as a game of Minesweeper. Remember that game from early PCs? You’d start with a grid of clickable squares, with cartoon mines hidden throughout. Your job was to take a few guesses, gain some information about where the mines were, and logic your way through finding them all. Similarly, startup founders start with an empty board. And although nobody can know their locations, the mines are guaranteed to be there — and certain types of mines are common to every kind of business. A founder can save a lot of time, money, and energy if they know how to avoid these pitfalls from the very start.

    After many years of navigating mines, I’ve identified the 50 most common ones. (I share lessons like this regularly in my newsletter — which you can find at my website, zaxis.page.) To be clear, this list is far from exhaustive. And while there are certainly exceptions, it can be a great shortcut for anyone leading a new initiative, at any sized company.

    Related: The Path to Success Is Filled With Mistakes. Do These Four Things to Tap Into Their Growth Potential.

    Ready to find your mines? Here they are.

    1. Thinking you have all the answers

    My favorite piece of advice for startup founders: You’ll be 90% wrong about your assumptions. The problem is that you don’t know which 90%. Therefore, do everything you can to challenge your convictions, and be willing to shed them or tweak them as needed. Rapid iteration and an open mind are two necessary ingredients for a successful startup journey.

    2. Ignoring the impact of compounding

    Meaningful long-term change takes time, be it learning new skills, obtaining new customers, or establishing a brand. The most underrated way to drive improvement is through incremental steps that compound over time. Einstein apocryphally called compound interest the “eighth wonder of the world.” Tiny changes each day multiply to astronomical gains, so long as you’re consistent and committed.

    3. Disregarding the law of funnels

    Any action a user or customer needs to take is considered the top of a “conversion funnel.” The goal is to get them to the bottom. One of the easiest ways to lose someone along that journey (a phenomenon known as churn) is to require them to go through too many steps. I call this the “Law of Funnels.” It states: “The more steps a user has to go through to do something, the less likely they are to complete it.”

    4. Hiring based on experience

    Startups have very little time and resources to focus on the wrong thing, but it’s impossible to predict what they will need to focus on. So don’t waste energy and precious hires on what a person has done in the past. It’s 97% irrelevant to what they will be doing in the future. Instead of hiring for relevant experience, hire people who are adaptable and good problem-solvers.

    5. Focusing on scaling too early (see fig. 1)

    Many startups overengineer and future-proof in the early days, which is almost certain to result in a tremendous waste of energy. At the start of the journey, there are very few knowns (see mistake No. 1). But one thing that is known is that there is a fundamental difference between the friction that prevents a product from taking off and the friction that prevents it from scaling.

    Related: Failed Startups Made These 7 Marketing Mistakes — Are You Making Them, Too?

    6. Wearing too many hats

    In my favorite brainteaser of all time, 100 prisoners wear different colored hats and strategize ways to identify their own hat colors. A startup often has far fewer than 100 employees, but often has far more than 100 hats. Context-switching carries a real cost, and early-stage employees who fail to delegate responsibility often end up performing all tasks poorly. Find people you can trust to take some of those hats off your head, and bring them in early.

    7. Comparing your work-in-progress to others’ finished works

    One of the easiest ways to get discouraged while running the startup marathon is to compare your rough drafts and works-in-progress to polished success stories. All difficult tasks (be they entrepreneurial, creative, educational, etc.) require iteration and more iteration, revision and more revision. The mistakes along the way are countless, sure, but they are also priceless. Comparing a work-in-progress to the finished products we see every day is not only demotivating — it’s also disingenuous. It’s comparing a sapling to a fully grown tree.

    8. Trying to solve unbounded problems

    To be solved effectively and efficiently, problems must be segmented and bounded. First, split your intractable problems into small, digestible challenges with a single goal in mind for each. Second, ensure that their solution is bounded to a finite solution space. Not realizing this is almost always a recipe for wasted resources and disappointing outcomes.

    9. Being frightened of incumbents

    Founders are often scared to take on powerful incumbents, believing those paths to be dead ends. This is a mistake. Taking on a monopoly is often a missed opportunity with enormous upside, and with lower costs than you think. There are four main reasons: Monopolies have already proven the industry is viable and lucrative. They refuse to cannibalize their own dominance. They’ve institutionalized their inefficiencies. And perhaps most importantly, they have the most to lose from making mistakes. Startups, by contrast, have the most to gain.

    10. Fearing the pivot

    For most startups, there are only two viable outcomes. In the unlikely case, they will be a big success. In the more likely scenario, they will fail. Don’t stick to early product or strategy decisions that raise the likelihood of the latter. If your startup fails, the value of all your decisions will be zero — so do everything you can to maximize the likelihood of success. If that requires pivoting from what you know and are comfortable with, so be it.

    Related: I Have Helped Founders Raise Millions. Here Are 7 Fundraising Mistakes I See Many Startups Making — And What You Need To Do Instead.

    11. Thinking you need to be first

    Passionate and creative thinkers often believe that in order to succeed, they need to be the first mover. This is wrong. Being the first mover is often a tremendous disadvantage. What matters is not being first but having consumers think you were first, all while benefitting from the courses charted by your forerunners.

    12. Catering too much to existing users (see fig. 2)

    Your existing users or customers are critically important; you wouldn’t have a business without them. But focusing too much on their needs necessarily comes at the expense of the audience you haven’t yet reached, and for whom you’re still struggling to showcase value. Catering to those who have reached the bottom of your funnel prevents you from serving the needs of those higher in the funnel, whose needs have not yet been served. This is the push and pull of product development, and there is a flip side to it. That’s the next mistake…

    13. Catering too much to potential users (see fig. 2)

    The danger outlined in mistake No. 12 swings the other way too. Neglecting to serve the needs of your existing users runs the risk of causing unnecessary churn. The cost of retaining customers you have already converted is substantially lower than the cost of obtaining new ones. Don’t be overly protective of the users you have, but don’t be overly dismissive either.

    14. Not understanding employee motivation

    Your employees are motivated by different things, and failing to recognize their different styles often leads to poor management as well as to employee dissatisfaction. I categorized people into a “Climber, Hiker, Runner” framework: Climbers are driven by the prospect of unlocking future opportunities. Hikers prefer to take on new challenges and learn new things. And Runners are happy when they can dive deep into what they’re good at. Approaching motivation this way has made me a better manager, and has helped me identify effective ways to keep employees happy.

    15. Focusing too much on short-term gains

    Successfully growing a startup is a marathon (see mistake No. 2). Short-term wins offer little beyond dopamine hits and the stroking of egos. In long-term success stories, accomplishing tough goals takes time but yields meaningful and lasting benefits. While it takes many short-term wins to get to the finish line, don’t miss the forest for the trees. Those incremental achievements are not the true goal. They are the means to an end.

    Related: 7 Common Mistakes to Avoid When Scaling Your Business

    16. Putting off hard conversations

    Your life is divided into two parts: that which occurs before you have the awkward, unpleasant, or emotionally taxing conversation you’re putting off, and that which occurs after. Which would you rather extend? If it’s the latter, why not do everything in your power to cross the boundary right now?

    17. Failing to recognize power laws

    Power laws govern everything you do. Most of the work you put into your startup will yield little clear benefit. Most of the success you see will come from a handful of bets. Internalizing this phenomenon leads to better decision making, less emotional turbulence, and healthier, more sustainable businesses.

    18. Overprotecting your idea

    Have a brilliant idea and an NDA preventing anyone from peeking at it? You’re likely not doing yourself any favors. Truly successful companies win with superior execution, not superior ideas (see mistake No. 11). And by overprotecting your idea from being prodded and challenged, you’re weakening its probability of ever coming to fruition. Often, those individuals who frighten you as potential competitors are those whose feedback is most valuable. And if you fear them stealing the idea, be comforted in knowing that there is no shortage of great ideas in the world. There is, however, a dire shortage of people who know what to do with them.

    19. Keeping interactions inside the office

    Whether in person or remote, the value of having your team “break the ice” cannot be overstated. I mean that in two ways. First, it’s of course good for your colleagues to get to know one another (and hopefully like one another), which leads to happier employees and higher productivity. Second, when people let loose, it “breaks the ice” of the day-to-day mayhem of startup life — or what I like to call “a necessary thawing period.”

    20. Getting too comfortable (see fig. 3)

    There is a big difference between being at a local minimum and being at a global one. Yet from a day-to-day vantage point, they look the same. Any change in any direction means more work, more stress, and more risk. We must zoom out and look at the entirety of our options. Sometimes the best paths or strategies lie just beyond a hill we’re scared to climb.

    Related: I Made These 3 Big Mistakes When Starting a Business — Here’s What I Learned From Them

    21. Not putting things in perspective

    When lost in the hustle and bustle of the early stages of a company, it’s important to remember that most stressful things don’t actually matter in the long term. They will do little to affect the eventual outcome, but they will heavily drain you in the near term. Please take regular moments to stop yourself, look at your small stressors, and ask if this really matters in life. It probably doesn’t.

    22. Not quantifying goals

    Goals without metrics are unbounded (see mistake No. 8). This makes them harder to achieve — and how will you know when you do achieve them? How will you hold yourself accountable when you’ve veered too far off course? Particularly when working as part of a team, quantifiable and measurable goals are of paramount importance to achieve any level of alignment.

    23. Waiting to find a technical cofounder

    Nearly everything I’ve needed to learn to become a technical cofounder, I taught myself (with the guidance of great mentors). You live in an age of wonders, where anyone can learn anything with incredible efficiency. Do not allow the search for a technical cofounder to prevent you from pursuing your dream. Become the technical cofounder yourself.

    For instance: Are you interested in AI but think you’ll never understand how it works? Think again.

    24. Looking for complicated answers when there may be simple ones

    Often, problems that seem intractable have elegant and simple solutions. We are trained to look for complexity, and to value those perspectives that overcomplicate the world. Ignore that instinct! The greatest insights I had as a founder came from light-bulb moments when I realized things were simpler than I’d assumed, not more complicated.

    25. Assuming there is only one path to success (see fig. 4)

    While other people’s success stories can motivate and inspire you, they can also be dangerous. Everyone’s path is unique, and often meandering. Anyone who says that your journey to success must follow a single trajectory has never built a company of their own; they’ve merely studied other people’s.

    Related: Business Owners: Are You Making These 10 Mistakes?

    26. Not filtering out high-frequency noise

    Most day-to-day problems are just noise. Sometimes it’s angry employees or customers. Sometimes it’s a deal gone bad or failing servers. Successful leaders adopt what I call a low-pass mentality. Just as low-pass filters in engineering absorb short-term shocks by filtering out the high-frequency ups and downs, a startup founder must filter out the noise and focus on solving long-term, systemic issues that will have a high impact.

    27. Putting your eggs in one basket

    As shown in mistake No. 1, you’ll be wrong about pretty much all your assumptions. So why risk your business on a single bet? Of course, it’s important to have convictions — but that doesn’t preclude you from simultaneously having other convictions, particularly at the very early stages. If the primary goal of a startup is to reach product-market fit quickly (see mistake No. 5), the risk of being wrong about your one big bet would be extremely costly.

    28. Putting your eggs in too many baskets

    Just as it is dangerous to wear too many hats (see mistake No. 6), it is similarly dangerous to tackle too many strategies at once. Successful leaders prioritize ruthlessly; that means tackling “critical” tasks before ones that are only “very important.” It means committing to seeing through strategies before expending energy on other ones. And it means rallying the whole team around a single milestone or goal, rather than splitting their attention and making everyone worse off because of it.

    29. Underinvesting in long-term relationships

    Most of the key turning points in my business career came through the strength of relationships fostered over many years. Small decisions to help others, to build trust, and to keep in touch can have a tremendous impact on your future in unpredictable ways. The worst-case scenario? Some wasted social energy. The best-case scenario? You open doors you never knew were there.

    30. Failing to recognize recurring patterns

    Despite all the unpredictable noise in business, there is an often-overlooked consistency between market cycles and the players within them. While it’s dangerous to place too much emphasis on individual success stories (see mistake No. 25), it is even more dangerous to overlook the cyclical nature of market dynamics. Human psychology is notoriously predictable — and notoriously forgetful.

    Related: How to Turn Your Mistakes Into Opportunities

    31. Not talking to other founders

    As a founder myself, I overlooked the learned experience of other founders. There is so much guidance buried in their success stories. There is even more to take away from their failures. As I said at the top of this article, startups are like a game of Minesweeper. You can tackle a blank board and start clicking away, or you can put aside your ego and get help from those who have played that board before. If you choose the latter, the likelihood of success can skyrocket.

    32. Focusing on vanity metrics

    There is a reason they are called vanity metrics. Hitting them is the kind of short-term gain I advised you to disregard in mistake No. 15. Why achieve goals that look good but aren’t strategically important? Why care about the number of users if those users are a poor fit and don’t stick around? Why focus on time spent using your product if that number is only high because your product is hard to use (see mistake No. 3)? Identify your desired outcomes, and then find the metrics that actually map to those outcomes.

    33. Misunderstanding the CAP principle

    In computer science, there is a fundamental limitation on how database systems can be built. One can never achieve more than two of the following three goals: consistency, availability, and partition tolerance (or “CAP”). The same is true of companies, which will inevitably see a decline in one of these as they invest in the other two. For instance, when ensuring all teams can talk to each other (availability) and that there is always an individual who can be the “source of truth” for others (consistency), your ability to manage when an employee leaves or communication channels go offline (partition tolerance) drops considerably.

    34. Never setting arbitrary deadlines

    Arbitrary deadlines are a tool. Like most tools, they can be good or bad, depending on who’s using them and for what. Yet while there are many times a team needs the space to think, build, and iterate without undue pressure, there are just as many instances that benefit from the structure and direction provided by arbitrary deadlines. Importantly, arbitrary deadlines should be recognized as arbitrary, and they should be adjusted if needed. But that doesn’t diminish their power in aligning a team and incentivizing productivity. In the right circumstances, I’ve seen them work wonders.

    35. Ignoring uncertainty principles

    Early-stage entrepreneurship, as in quantum physics, presents an inescapable tradeoff. Resources (time, money, etc.) can be spent on investing in a specific strategy or on keeping open optionality; they cannot do both. I call this phenomenon the Startup Uncertainty Principle. It shows that the more you focus on the present, the less you’re able to prep for the future. And the more you prep for the future, the less effective you’ll be now. Companies that attempt to do both at once are fighting a losing battle.

    Related: Common Mistakes First-Time Entrepreneurs Make and How to Stop Them

    36. Not prioritizing low-hanging fruit

    As shown in mistake No. 28, successful companies prioritize ruthlessly. When companies spread themselves and their employees too thin, they hurt productivity and morale. Of course, there is value in investing in longer-term projects with higher costs and higher rewards. Yet it is also critical to regularly prioritize easy wins and short-term opportunities that move the needle incrementally. In addition to laying the foundation for compounding improvements (see mistake No. 2), it will also reengage your teammates and keep morale high.

    37. Overlooking unexplored markets

    As founders and dollars race to build in competitive, high-growth markets, opportunities often exist in “hidden layers” of industry. Companies that focus there can ride waves of market growth while avoiding fierce competition, by turning potential competitors into actual customers. Some of the most valuable companies in the world have taken this approach (including the two most valuable) and it has paid dividends (literally).

    38. Not relying on proven technology

    New technological solutions to longstanding problems can be attractive. But the hidden downsides can surface much too late — often when you’re already dependent. New technologies can break, can go out of business, can have unexpected side effects. By contrast, longstanding problems tend to have proven longstanding solutions. While not as exciting to use, they work, and that’s what matters most.

    39. Sugarcoating bad news

    Managers sometimes believe that when things get hard — and they inevitably will, many times over — bad news is better delivered indirectly or with a positive spin. This is an innate human desire. But employees are smart. Being disingenuous about the state of the business or the rationale for business decisions will hurt your company over the long term. This applies to everything from layoffs to pivots to cutting perks. Your employees will see through the euphemisms, rendering your sugarcoating fruitless, and they will respect you less for your lack of directness.

    40. Ignoring entropy

    It’s a law of the universe that everything trends toward disorder. Knowledge and control are no different. No matter what, eventually you’ll be wrong. Your convictions will need to adapt as the world in which they exist evolves. The stable parts of your business will suffer from unexpected market dynamics, new competition, and shifting consumer attitudes. Those who succeed in the long term embrace entropy as a fact of life, and they know that they cannot hold anything too sacred for too long.

    Related: 10 Mistakes I Made While Selling My First Startup (and How You Can Avoid Them)

    41. Forgetting your only advantage

    With limited time and limited resources, only so much can get done. A startup has every disadvantage relative to more well-funded incumbents, and only one advantage: speed. Leverage this. Big players are slow to move and slow to turn, like giant cruise ships. Startups are small and nimble sailboats that can race faster and turn on a dime when it matters.

    42. Treating money like it isn’t fungible

    A dollar is a dollar is a dollar. Every single dollar spent—no matter how it’s accounted for — is money not spent on something else. This is all the more reason to prioritize ruthlessly (see mistake No. 28). Resources have a habit of disappearing faster than you’d expect.

    43. Not explicitly deciding how to balance productivity and alignment (see fig. 5)

    Companies that overinvest in aligning their team members do so at the expense of productivity. Those that focus on productivity do so at the expense of alignment. The optimal balance depends on the company, its size, and its unique journey. But the important takeaway is that you are making this trade-off whether you explicitly choose the balance or not — so you might as well choose it.

    44. Only talking to people you know

    The “birthday paradox” shows that if you put 23 people in a room together, there is a 50% chance two will share the same birthday. By the same mathematical logic, if any conversation has even a 0.3% chance of being life-changing, then putting a few dozen people in a room together is virtually guaranteed to lead to some life-changing conversations. The takeaway? Meet more people. (Here’s a good way to do that.)

    45. Working only from home

    Startup stress can seep across any boundaries you’ve set. To drive both productivity and better mental health, don’t work exclusively from where you sleep and spend time with family. I say “exclusively” because I have seen startups achieve great success in a fully remote setup. Still, the early days of startups rely critically on serendipitous conversations and ideations — and that can only happen when employees are colocated. Get the team together now and then.

    Related: 5 Marketing Mistakes Startups Must Avoid in Order to Survive

    46. Working only from an office

    Most founders I know get their best ideas when they’re not at work. There’s something about the change of scenery, the connections between unrelated neurons, and the exposure of a problem or challenge to a new environment. Whereas mistake No. 45 showcases why it’s important to sometimes bring your team together, this one recognizes that it’s equally important to take them out of their comfort zones and get them to interact in brand-new places and brand-new ways.

    47. Forgetting to revisit whatever motivates you

    When things get difficult (and they will), it’s important to reflect on the things that helped motivate you to start in the first place. Have it readily accessible—be it a movie or a podcast episode or a book or a soundtrack — and revisit it when you feel the morale drop. For me in my Anchor days, it was Daft Punk’s Random Access Memories. To this day, if I need a jump-start in motivational energy, I just put on that album and get to work.

    48. Not taking pictures

    You’re going to miss the early days. You’ll wish they were better documented. If things end up working out, you’ll look at those moments in time and say, “Wow, look how far we’ve come.” And if things don’t, you’ll say, “Wow, look how hard we worked. If I did that, I can handle anything.”

    49. Assuming you have product-market fit

    Product-market fit is the elusive transition point at which you realize who your customers are and what value you’re providing for them. Hardly anyone reaches this point without considerable effort, and the easiest way for a brand-new enterprise to fail is to assume they have reached this point when they have not. There are only two ways — talking to customers and looking at data — that can verify the milestone has been hit. Once there, things get considerably easier.

    50. Thinking there are only 50 startup mistakes

    I suppose I’m guilty of this one right now. No list of startup advice is exhaustive. Every new entrepreneurial journey is bound to uncover unique challenges. Yet that’s also part of the fun of the startup journey: You never know what’ll happen next.

    A version of this article originally appeared on Nir Zicherman’s newsletter, Z-Axis.

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    Nir Zicherman

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  • Startup Behind Goldman Sachs’ First ‘A.I. Employee’ Valued at $10B After Peter Thiel Funding

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    Peter Thiel’s Founders Fund led Cognition’s latest $400 million funding round. Photo by Nordin Catic/Getty Images for The Cambridge Union

    Cognition AI, the San Francisco-based startup known for its A.I. software engineer Devin used by Goldman Sachs, has more than doubled its valuation to $10.2 billion after raising more than $400 million in a round led by Peter Thiel’s Founders Fund. The deal, announced yesterday (Sept. 8), also drew participation from existing backers including angel investor Elad Gil, Lux Capital, 8VC, Neo, Definition Capital and Swish VC. The fresh financing marks a stark increase from the $4 billion valuation Cognition received earlier this year.

    Cognition was launched in 2023 by Scott Wu, Steven Hao and Walden Yang. Wu, the company’s CEO, previously co-founded Lunchbox, an A.I. networking platform. The founding team also includes alumni of Scale AI, Google DeepMind and self-driving software maker Waymo, as well as a number of elite coders who medaled at the International Olympiad in Informatics, a global programming competition.

    Cognition’s flagship product is Devin, an A.I. software engineer. The company also made waves through acquisitions, most notably when it snapped up software firm Windsurf just days after Google hired away much of its leadership. While OpenAI had reportedly pursued Windsurf before complications with its partner Microsoft, Google in July struck a multibillion-dollar licensing deal for Windsurf’s technology and acqui-hired several top staffers. Cognition then acquired what remained of the company: its team, intellectual property and product.

    Even before the Windsurf deal, Cognition’s annual recurring revenue (ARR) had climbed rapidly—from $1 million in September 2024 to $73 million by this June, Wu said in a press release. Since the acquisition, ARR has more than doubled. “We’ll continue to invest significantly in both Devin and Windsurf, and our customers are already seeing how powerful the combination is together,” Wu added, noting that clients include Goldman Sachs, Dell and Palantir.

    Looking ahead, Cognition plans to expand the ways its users can leverage the combined power of Devin and Windsurf. “We’re looking forward to enabling engineers [to] manage an army of agents to build technology faster,” said Jeff Wang, Windsurf’s interim CEO since former leader Varun Mohan departed for Google, in a LinkedIn post. “It’s been quite an eventful last few months, and now it’s time to show what we’re made of.”

    Startup Behind Goldman Sachs’ First ‘A.I. Employee’ Valued at $10B After Peter Thiel Funding

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    Alexandra Tremayne-Pengelly

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  • ‘We Live the Brand’: Why Mark Wahlberg and Harry Arnett Built a Company That Embodies Relentless Ambition | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    Municipal CEO Harry Arnett met his future co-founder in a setting familiar to many business leaders: the golf course. They bonded quickly over shared experiences — raising kids, navigating careers — and from that connection, a friendship grew. At first glance, it sounds like a typical entrepreneurial origin story.

    But in Arnett’s case, the partner by his side wasn’t another executive. It was Oscar-nominated actor and Boston icon Mark Wahlberg.

    Related: John and Hank Green Built a Company That Gives Away 100% of Its Profits — Here’s How

    Purpose over products

    “When Mark and I first discussed starting a brand, it wasn’t about the products,” Arnett tells Entrepreneur. “It was about how we could equip modern consumers with what they need to achieve their goals.”

    They, along with film and television producer Stephen Levinson, identified a major white space at the intersection of fitness and fashion. Arnett formerly served as executive vice president at Callaway Golf, where he noticed a shift in how consumers engaged with brands.

    “They were starting to seek direct relationships with brands they liked, primarily through digital media,” he explains. As EVP, he focused on revitalizing Callaway by reconnecting with consumers in a fresh, dynamic way — a strategy he calls the centerpiece of his community-building efforts.

    After years of back-and-forth, the duo finally launched Municipal in 2019.

    “The idea for Municipal was something I’ve wanted to do for a long time,” Wahlberg tells Entrepreneur. “It wasn’t about just attaching my name to someone else’s idea, which is often what celebrity-led brands are. Municipal is different — this is a real partnership from the ground up.”

    The launch meant Arnett had to leave Callaway. “For me, that was an aha moment,” he says. “A chance to step away from a comfortable, familiar career and start over in pursuit of the best version of myself.”

    That mentality became the ethos of Municipal, a company founded on helping modern consumers pursue excellence in all aspects of life.

    “Municipal is about creating the best products in the world for workouts, athletic pursuits and everything in between, from the office to an active weekend,” Arnett explains. “It might sound like we’re trying to be everything to everyone, but when people see our product, they get it immediately — no one makes gear like we do.”

    Related: Restaurants Are Throwing Away Billions of Gallons of Water — This Startup Said Enough

    Building tomorrow’s leaders

    Contrary to standard practices, where brands are encouraged to hone in on a focus area, Arnett positions Municipal as more than just another activewear company, calling that label too “one-dimensional.”

    He envisions the brand inspiring a drive to succeed in any arena — athletics, academics or beyond. A key part of this approach is Municipal’s Next Gen Brand Immersion, a free, week-long program that gives young people an inside look at every aspect of building a modern, purpose-driven brand — from product design and marketing to finance and operations.

    “Too often, young people are fed the myth of overnight success and shortcuts,” Arnett says. “From our experience, those are fantasies. We saw an opportunity to use our platform to celebrate ambition, hard work, and self-belief in a way that feels ‘cool’ for kids.”

    The idea for the program didn’t originate with Arnett or Wahlberg, but with Arnett’s youngest daughter, Kerris, who has shown a keen interest in Municipal.

    “We’ve been talking about the brand since day one, and she got really passionate about it,” Arnett shares. “She said it would be amazing if more kids her age could experience these kinds of things firsthand, instead of just reading about them. I told her, ‘Karis, that’s a big idea.’”

    Building on his daughter’s suggestion, Arnett sought to replicate what brands like Nike have done with sports camps — creating a talent pipeline for Municipal while connecting the company with the next generation of potential entrepreneurs and gaining insights into the preferences of the highly coveted Gen Z audience.

    The effort culminated in a week-long, hands-on program giving ambitious 18- to 24-year-olds a real look at what it takes to build a modern, purpose-driven brand. Participants work directly with Municipal’s team across product design, marketing and operations, gaining experience in creating, launching and promoting a real collection.

    The students even designed a capsule — featuring a hoodie, pants, shorts, t-shirt and hat — that Municipal will release and help market.

    “It’s a way to engage with this group beyond just selling the best gear in the world,” Arnett explains. “These 25 students are leaders in their schools and have become rabid Municipal fans. They’ll tell their friends, and even when they go off to college, they’ll maintain a connection with us. The possibilities for extending that relationship feel practically endless.”

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    Leo Zevin

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  • We Built a 7-Figure Business Without a Single Investor — Here’s Why Saying No to VC Was Our Smartest Move | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    You’ve heard this story before: a couple of college kids launch a startup from their dorm room. Surrounded by engineers, finance majors and future founders, venture capital wasn’t just common — it was expected. So when my co-founder and I launched Prepory, our college admissions coaching company, we assumed we’d need funding to be taken seriously.

    We entered a pitch competition and came in second. No check. We reached out to investors. No bites. We had a choice: give up or keep building.

    We kept building.

    What started as a one-person operation helping students in our local community has grown into a seven-figure, global company with nearly 100 team members. We’ve supported over 14,000 students, partnered with school districts and institutions in multiple countries and built one of the most trusted brands in college admissions — all without a single outside investor.

    Here’s why we said no to VC, and why bootstrapping was the smartest decision we never planned to make.

    The pressure to raise

    In elite academic circles, starting a business often goes hand in hand with chasing venture capital. I pictured the high-stakes pitch rooms, the dramatic investor meetings — scenes straight out of The Social Network. But after our early efforts fell flat, we stopped trying to win someone else’s approval and turned our focus inward.

    We obsessed over our product, our client experience and our outcomes — not “scale.”

    One month before our one-year mark, we hit $100,000 in revenue. It wasn’t a headline-grabbing number by Silicon Valley standards, but it proved something more important: we didn’t need permission to grow. We just needed to execute.

    Related: Most Startups Ignore This One Asset That Makes or Breaks Their Success

    What bootstrapping taught us

    In hindsight, bootstrapping didn’t just work — it shaped the business in ways VC money never could.

    Every dollar mattered, which meant we tested fast and paid close attention to what customers wanted. Client feedback shaped everything. We pivoted early on from a B2C model to B2B — realizing that one school contract could bring the same revenue as ten individual clients. That insight wasn’t born from a boardroom; it was born from necessity.

    Bootstrapping also made me a better leader. I didn’t start by managing dozens of people. I started with one, then five, then ten. That kind of slow, intentional growth gave me room to develop as a leader — learning how to listen, communicate clearly and lead with clarity and care. There was no pressure to scale overnight, so we could prioritize culture, values and quality.

    The hidden cost of raising too soon

    VC can be a powerful accelerator — but if you raise too early, it can also be a trap.

    Many founders take funding before they’ve found product-market fit. They shift their focus from solving customer problems to pleasing investors. Instead of building a strong foundation, they’re stuck managing burn rates and expectations. Teams get stretched. Quality suffers.

    We built slowly. That meant we stayed close to our mission and recruited talent who were energized by the opportunity to build something meaningful. Today, we outperform companies twice our size because we’ve built a team that shows up with purpose — and we’ve stayed aligned with what matters most: helping students reach their full potential.

    Related: How to Scale a Business Without Wasting Millions (Or Collapsing Under Your Own Growth)

    Should you bootstrap?

    Ask yourself this: What do you actually need the money for?

    If you’re building a product that truly requires upfront investment — hardware, tech or time-sensitive development — funding may make sense. But if you’re starting a service-based business, you might not need capital to get traction.

    Bootstrapping requires resilience, patience and a tolerance for delayed gratification. But it gives you full ownership of your company, your vision and your decisions. Today, we have the freedom to invest in growth on our own terms.

    People still ask if we’d raise money now. My answer? Not unless we have a strategic reason to. Not because I’m anti-VC, but because we no longer need it.

    Bootstrapping gave us something far more valuable than capital: it taught us how to build a resilient, values-driven, adaptable business. And if we ever decide to raise, we’ll do it from a position of strength — not survival.

    You’ve heard this story before: a couple of college kids launch a startup from their dorm room. Surrounded by engineers, finance majors and future founders, venture capital wasn’t just common — it was expected. So when my co-founder and I launched Prepory, our college admissions coaching company, we assumed we’d need funding to be taken seriously.

    We entered a pitch competition and came in second. No check. We reached out to investors. No bites. We had a choice: give up or keep building.

    We kept building.

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    Daniel Santos

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  • Paris-Based Mistral AI Seeks $14B Valuation as Europe Charts Its Own A.I. Path

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    CEO Arthur Mensch is steering Mistral away from the AGI hype and toward Europe’s A.I. sovereignty. Photo by Ludovic Marin/AFP via Getty Images

    Paris-based Mistral AI is on track for a new funding round that would value the A.I. startup at 12 billion euros ($14 billion), Bloomberg reports. The investment, expected to total around 2 billion euros ($2.3 billion), would solidify the company’s position at the center of Europe’s sovereign A.I. strategy and bring it closer to its goal of challenging dominant U.S. rivals.

    Founded in 2023, Mistral has already raised some 1.1 billion euros ($1.3 billion) over the past two years. Its upcoming valuation would more than double the 5.8 billion euros ($6.8 billion) figure it reached last June following a 468 million euro ($550 million) round that drew backers such as Andreessen Horowitz, Salesforce and Nvidia.

    Mistral did not respond to requests for comment from Observer.

    For now, the startup still pales in size compared to its Silicon Valley competitors. Anthropic closed a round earlier this month at a staggering $183 billion valuation, while OpenAI is reportedly eyeing $500 billion. Still, Mistral is eager to compete. Its products include an A.I. assistant called “Le Chat,” designed for European customers and positioned as an alternative to OpenAI’s ChatGPT and Anthropic’s Claude chatbots.

    Mistral was co-founded by Arthur Mensch, a former researcher at Google DeepMind, along with former Meta researchers Timothée Lacroix and Guillaume Lample. Mistral has tried to distinguish itself by emphasizing open access. It has released several open-source language models. Unlike American A.I. giants, Mistral has also rejected pursuing AGI. Mensch, who serves as CEO, has said his firm is more focused on ensuring U.S. startups don’t dominate how the technology shapes global culture.

    Mistral is central to Europe’s A.I. playbook

    Mistral is part of a broader surge in European A.I. investment. In 2024, venture capital rounds involving A.I. and machine learning companies based in Europe were estimated to have reached 13.2 billion euros ($15.5 billion), up 20 percent from 2023, according to data from Pitchbook.

    Mistral is part of a broader surge in European A.I. investment. In 2024, venture capital rounds involving A.I. and machine learning companies across the continent were expected to reach 13.2 billion euros ($15.5 billion), a 20 percent increase from the year before, according to PitchBook.

    As one of Europe’s leading startups, Mistral is central to the region’s goal of building an A.I. ecosystem independent of technology from America or China. Earlier this year, the company partnered with Nvidia to launch a European A.I. platform that will allow companies to develop applications and strengthen domestic infrastructure. French President Emmanuel Macron hailed the initiative as “a game changer, because it will increase our sovereignty and it will allow us to do much more.”

    Mistral’s rapid ascent is tied to broader efforts to bolster A.I. across Europe and France. Its Nvidia partnership followed Macron’s announcement at Paris’ global A.I. summit in February, where he pledged more than 100 billion euros ($117 billion) to support France’s A.I. industry. European players must move quickly, Macron stressed at the time: “We are committed to going faster and faster.”

    Paris-Based Mistral AI Seeks $14B Valuation as Europe Charts Its Own A.I. Path

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    Alexandra Tremayne-Pengelly

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  • Connection at Scale: Designing Belonging in the Age of Loneliness

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    The Camp Social founder shares how intentional design turns strangers into friends and proves belonging can be built. Courtesy Camp Social

    This Q&A is part of Observer’s Expert Insights series, where industry leaders, innovators and strategists distill years of experience into direct, practical takeaways and deliver clarity on the issues shaping their industries. At a time when loneliness is being called a public health crisis and nearly half of U.S. adults say they struggle to make friends, Liv Schreiber is proving that connection can be designed. And that joy is contagious when done right. As founder and CEO of Camp Social, a fast-growing community and events platform, Schreiber has built a business around something most of us crave but rarely prioritize: real human connection.

    Her approach is anything but ordinary. Camp Social doesn’t rely on contrived icebreakers or staged exclusivity. Instead, it invites people to show up solo and leave with a sense of belonging, whether through group hikes, paddleboarding sessions, yoga flows or roundtable dinners. Ninety-nine percent of attendees come alone, and 100 percent leave with new friends. For Schreiber, the formula is simple but intentional: create an atmosphere that’s warm, energetic and safe enough for people to drop their guard.

    From navigating intergenerational friendships to balancing the reach of digital platforms with the depth of offline experiences, Schreiber’s work is a reminder that social connection is a skill—and a business—worth cultivating.

    What key ingredients make people feel safe and open at social events?

    It starts with making people feel comfortable being themselves in a new environment. That means creating an atmosphere that’s warm, low-pressure, and welcoming, like freshman year of college, where everyone’s somehow in the same boat. At Camp Social, we do this through small details: encouraging people to come solo (99 percent arrive solo and 100 percent leave as friends), bonding over fun activities like paddleboarding, yoga and hikes instead of cringey group icebreakers, shared meals at roundtables, uplifting music, leadership staff and I demonstrating how excited we are to have our campers with us.

    The goal is to make it easy for people to talk, laugh and connect, without overthinking it, feeling like they’re at home, not visiting.

    A group of women around a picnic table A group of women around a picnic table
    Strangers arrive solo, but leave as friends. Courtesy Camp Social

    How do you curate a crowd without making it feel curated?

    I focus on vibe over visuals. It’s not about everyone dressing the same or looking the same. In fact, our wide range of ages and diversity are something I’m most proud of. We attract the vibe we put out: we want people who are kind, open, enthusiastic. 

    People you’d want next to you at a campfire or a dance party. It’s less about exclusivity and more about creating a room full of people who make each other feel good and come in with open, positive, excited attitudes.

    What has building Camp Social taught you about female friendship, and what are we still getting wrong?

    We’ve been taught that friendships should feel effortless, but real connection takes intentionality. Camp Social has shown me that most women want deeper friendships; they just don’t always have the time or space in their day-to-day lives. So we created a space where you don’t have to play it cool or play a game at all. You can show up, be yourself, and know that everyone else is looking to connect, too. It’s instant.

    How do you balance digital reach with offline authenticity?

    Social media gets people in the door, but what makes them stay is how they feel once they’re there. The offline experience majorly exceeds the online hype. That’s how it should always be. The American Psychiatric Association’s 2023 poll found 30 percent of adults experience loneliness at least once a week, and 10 percent feel lonely every single day, with adults 18 to 34 most affected. We need to feel joy and community in real life!

    Thoughtful moments, epic goodies, good conversation, unexpected fun, that’s what keeps it real. When people leave saying, “I feel like I just made 100 new best friends,” that’s the win. And that’s what builds real community, not just a following. I’m uninterested in catfishing.

    What advice would you give someone who’s moved to New York and doesn’t know how to make friends?

    First of all, you’re not alone. A lot of people feel that way (1 in 2 adults in the U.S.), that’s why I started my businesses. Most people are just waiting for someone else to make the first move. So be the one who reaches out. Say yes to things. Invite someone for coffee, even if it feels awkward. You don’t need a million friends, you just need one incredible person. And if you don’t know where to start, that’s literally why we built Camp Social. You have to be a villager to have a village, so make sure you feed the flame once it starts.

    A group of women dancing A group of women dancing
    Connection takes center stage when the setting is safe, joyful and real. Courtesy Camp Social

    The Camp Social audience is anyone young at heart. What is so special about intergenerational friendships, and how should you go about making intergenerational connections

    Intergenerational friendships are the secret sauce no one’s talking about! They stretch your perspective and bring a kind of grounding that same-age friendships sometimes can’t. Having a friend who’s 20 years older than you reminds you that things you’re stressing about might not matter in the long run, and having a younger friend keeps you curious and plugged in.

     A 2023 Journal of Social and Personal Relationships study found that adults with meaningful intergenerational relationships reported higher levels of life satisfaction, emotional regulation and even cognitive function. Another survey by Generations United revealed that 92 percent of Americans believe intergenerational relationships reduce loneliness, and only 26 percent say they have them regularly. That gap says everything. We need Camp Social.

    What’s special is that both people bring something valuable to the table: stories, wisdom, humor, new references, new ways of thinking. It’s like finding prequels and sequels of your favorite book that you didn’t know you needed.

    People must drop the assumption that friendship has to look a certain way. Stay open to connection in unexpected places, a coworker, a neighbor, someone at your gym or your mom’s best friend. Friendship is about shared energy and a mutual willingness to show up for each other.

    Some of the most meaningful connections I’ve seen at Camp Social have been between people with totally different backgrounds, careers, and ages. That’s the beauty of it: we’re all just humans looking for people who get us. If you’re lucky, sometimes, that person who gets you isn’t in your age bracket. That’s the beauty.

    Camp Social has grown quickly in a notoriously hard-to-scale space: human connection. What strategies have been most effective in translating something so personal into a sustainable, growing business?

    Camp Social grew fast because I never treated it like an “event.” It feels like family, and I treat my campers and staff like family. We have created moments—charcuterie boards and firepits at sunset, letters-to-themselves stations and friendship bracelets, dance parties at dinner, customization of individual schedules and outdoor movie nights—that made women feel seen and part of something bigger than themselves. Word of mouth is our best growth channel. Every camper has become a brand evangelist because they weren’t just attending, they were belonging. 

    That intimacy scales when you build systems around it—surveys, bunk assignments, diligently trained staff who are an extension of me—so that every woman still feels like she got a personalized, magical experience, even at a 1000-person scale. The number of attendees and popularity don’t and will never matter to me. It’s the quality of experience that I’m responsible for.

    Women kayaking on a lake at a Camp Social eventWomen kayaking on a lake at a Camp Social event
    From paddleboards to roundtables, every activity is designed for belonging. Courtesy Camp Social

    Have you faced moments when scaling threatened to dilute the “magic” of Camp Social? How did you protect the integrity of the experience while growing?

    Of course there were moments where I worried, but I just created what I wanted to experience and removed what would stress me as a consumer. To protect the “magic,” I doubled down on small touches—welcome notes, intentionally curated bunkmate pairings, surprise activations that feel intimate and are only brands that I actually use and love. Saying no to what doesn’t align, no matter the dollar offer. 

    The bigger we got, the more important it became to weave in micro-moments of intimacy and say no to the big guys that don’t align. Every human touch point matters, and scaling didn’t mean diluting. It meant more designing for intimacy at scale. It is a responsibility I’m grateful for. 

    Are there lessons from Camp Social that could translate into corporate or workplace culture? How can companies make teams feel more connected and creative?

    Camp Social proved something I think every company should pay attention to: connection fuels creativity. People do their best work and stay longer when they feel emotionally safe and socially plugged in—without being attached to work 24/7. Provide communal meals that aren’t “networking” but true bonding. Activities that the company can offer for employees in their downtime or during lunch. Camp Social is proof that when you build infrastructure around belonging—and back it with intentional leaders and staff, productivity and retention follow.

    A group of woman hold hands at the shore of a lake, running toward the waterA group of woman hold hands at the shore of a lake, running toward the water
    A loneliness antidote: creating spaces where community grows naturally. Courtesy Camp Social

    In your view, what’s the future of community-driven brands? Where do you see this space heading in the next five years, and how will Camp Social evolve to meet it?

    We’re in a loneliness epidemic, but also a renaissance of community. The future belongs to brands that don’t just sell a product—they create belonging. In five years, I see community-driven brands blending IRL and digital seamlessly, offering memberships, products, retreats and always-on touchpoints that extend beyond one-off transactions. For Camp Social, that means scaling into memberships, global retreats and digital platforms where the magic of connection continues year-round. It’s not just camp. It’s a lifestyle. I’m glad the business world is finally listening. 

    Connection at Scale: Designing Belonging in the Age of Loneliness

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    Liv Schreiber

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  • I Turned My Hobby Into a Global Startup for Writers — Here’s the Playbook | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    Since childhood, I’ve been a bookworm. My all-time favorite books include a mix of non-fiction and finance. However, this didn’t stop me from transforming my biggest hobby into My Passion, the top-2 e-book platform globally.

    The platform already has over 1,000 books, and every two weeks we release another 2–3 bestsellers. For entrepreneurs wondering if their passion could become their next startup, here’s exactly how I did it — and the framework that can work for you too.

    Related: AI Won’t Wait for Your Strategy — Why Should Your Leadership?

    Define your ‘Why’

    86% of people who started a hobby-based business report higher job satisfaction. But here’s what they don’t tell you: satisfaction doesn’t equal success, and most hobby businesses never scale beyond side hustles.

    Don’t quit your job just because you read how Zuckerberg started Facebook as a hobby project for Harvard students, or how Boeing turned his love of aircraft into a billion-dollar company. Instead, consider WHY you truly desire to launch your startup.

    Here’s how I discovered mine.

    For me, reading was more than just entertainment. This is what shaped my worldview.

    Books showed me the world beyond survival — I read about Van Gogh, artists and creators who transcended their environment. This sparked the belief that my background doesn’t define me — a mantra I carry to this day.

    I didn’t just want to open a bookstore, launch an app or write a book for money. My goal was to empower writers globally. Ultimately, storytelling became the DNA of my startup, Holywater, which unlocks people’s potential by combining their imagination with AI capabilities, from books to streaming and AI-powered series.

    Now, writers worldwide share stories and gain recognition through My Passion. Moreover, books evolve into My Drama’s vertical series with a global reach. We are also developing the PYSHY (WRITE) contest with Vivat Publishing, which creates real earning opportunities for writers.

    We got 444 submissions, 3 were picked for publication and 1 was adapted for a top-performing vertical series.

    You can simply monetize your hobby, for example, by selling your books, paintings or clay crafts. Or you can turn it into a global startup. Your why and scale make all the difference.

    Connect your passion with a real-world solution

    Your passion must translate into value for others, not just personal satisfaction. The reason 42% of startups fail is misreading market demand. Simply put, founders spent money and time launching a product that no one needed.

    Identify what other people’s problems or needs you can solve by turning your hobby into a startup. Consider how successful founders made this connection. Etsy transformed the love of handmade crafts into a global marketplace for unique goods. AeroPress turned one coffee enthusiast’s quest for the perfect brew into a portable solution for coffee lovers worldwide. These founders connected their passions with unmet market needs, creating products that solved real problems and resonated with millions.

    Through my reading journey, I realized a fundamental gap: people love stories, but they lack the tools and support to tell them well. Writer’s block, pacing issues and structural gaps limit creativity, and working on a book alone is exhausting. After all, professional storytellers have entire teams of editors, plot consultants and visual artists.

    Launching My Passion together with Anatolii Kasianov, we applied AI to democratize storytelling support, giving every writer access to plot development, visual elements, structure recommendations and pacing advice. Support that was previously only available to well-known authors is now available to all creators.

    Start with a small community

    Ask yourself: Is this hobby large enough to involve other people? Your passion requires a community to become a sustainable business.

    Many great businesses started as small communities that later scaled. For instance, Reddit began as a platform for niche interests and grew into a global discussion hub, and Duolingo was a small beta community of language learners testing early lessons. Nowadays, you can easily build a community on social media and get feedback there. It’s a great chance to get like-minded people together and test out your idea.

    The beauty of starting small is that it allows you to validate demand without massive investment. You can quickly discover whether others share your passion and face similar challenges.

    Related: How a Side Hustle Led to a $1 Million+ Passive Income Stream

    Don’t let your passion turn into a nightmare

    Understand the stakes and pressure that come with monetising your hobby. When your livelihood depends on what once brought you pure joy, the dynamic changes completely. Deadlines replace spontaneity. Market demands can override creative instincts. Financial pressure can drain the original magic. The result: burnout, which affects more than half of founders.

    What keeps me going? Again, books. Not for market research, but for myself. Besides, I have other passions. For example, I meditate every day and share insights on LinkedIn. It is extremely important for startup founders not to get stuck only in work, especially if their hobby and startup are now combined.

    The line between hobby and business disappears when your work helps others experience the same transformation that once changed you. When writers tell us our platform helped them overcome creative blocks they’d struggled with for years, I know we’ve moved beyond monetizing a hobby — we’re scaling transformation.

    Your greatest obsession might just be your greatest business opportunity, but only if you can preserve what made you fall in love with it in the first place.

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    Bogdan Nesvit

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  • Your Startup Seems On Track — But An Invisible Growth Blocker Says Otherwise | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    As a founder, your focus is growth — more users, more features, more market share. But sometimes the biggest thing standing in your way isn’t your business model, marketing or funding. It’s your tech team.

    Not because they’re doing something wrong — but because they’ve taken you as far as they can.

    And when you finally bring in a new team or vendor, it’s a stress test. For the business, it means facing hard questions about control. For the new team, it means diving into someone else’s legacy code. And for you, the founder, there’s one phrase no one ever wants to hear:

    “Honestly, it might be easier to rebuild this from scratch.”

    But here’s the thing — you don’t need a fire to smell the smoke.

    Related: The Top 2 Mistakes Founders Make That Hinder the Growth of Their Companies

    The calm before the stall

    Sometimes, founders realize something’s off when everything starts breaking — delivery delays, ballooning budgets or a tech stack that feels five years old. But just as often, things look fine on the surface.

    Code is getting shipped. Deadlines are met. Users are active, maybe even paying. On paper, it all looks “on track.”

    But under the hood, your product may already be maxed out. Not because of bugs — but because the team that built it wasn’t thinking far enough ahead.

    This is the silent stall: when your product stops being a launchpad and becomes a ceiling. It still works, but it can’t grow.

    No scalable tech foundation

    Most growth plans boil down to a simple idea: make it work, then scale. But can your architecture, tools and infrastructure handle that scale?

    If your tech partner lacks a long-term mindset, they’ll deliver what you ask for — but not what you’ll need next. That means you’ll constantly be in maintenance mode, fixing things that should’ve been built right the first time.

    And growth adds pressure fast: more users, more data, more complexity. What works for a few thousand users might fall apart at scale — or cost you exponentially more to run.

    A good tech partner doesn’t treat scalability as an upgrade. They design for it from day one. Modular systems, clean infrastructure and smart trade-offs aren’t technical luxuries — they’re what make future features (and funding rounds) possible.

    Because rebuilding later costs more. In time, money and momentum you won’t get back.

    An incomplete team

    Here’s something that trips up a lot of startups: assuming developers alone can carry the product.

    Developers are essential, of course. But building a successful digital product takes more than code. You also need:

    • Business analysts to map user and market needs into features
    • UX and UI designers to shape user experience
    • Solution architects to plan scalable systems

    If your current vendor only supplies engineers, you’re not working with a product partner — you’re working with a contractor. That might be fine early on, but over time, it’s a limitation.

    Without the right roles in place, your product gets built in a vacuum. There’s no one translating strategy into functionality or guiding decisions with the bigger picture in mind.

    A complete product team is cross-functional by design. The best vendors can pull in the right expertise when needed — not weeks later, but immediately.

    No plan for what’s next

    Plenty of teams are great at delivering today’s requirements. But what about tomorrow’s?

    If your tech partner isn’t helping you plan for monetization, scale or the next fundraising round, you’re not set up for sustainable growth.

    Think about how much future planning touches:

    • Payment systems
    • Onboarding flows
    • App store requirements
    • Subscription models
    • Analytics and data tracking

    Miss these pieces early, and you’ll end up rebuilding later — right when you should be scaling. Investors notice too. They expect clean data, thoughtful UX and systems that support growth, not just usage.

    A strong tech partner will challenge assumptions and help you anticipate what comes after this version. Because scaling isn’t just more code — it’s pricing, performance, infrastructure and go-to-market timing all working together.

    If your team isn’t thinking that far ahead, it’s time to find one that is.

    Related: 6 Unconventional Habits That Actually Help Entrepreneurs Find Work-Life Sanity

    Final thoughts

    Not all stalled products fail loudly. Sometimes the most dangerous moment is when everything seems fine — but nothing’s moving forward.

    You don’t need a crisis to justify a change. You need a vision that your current team can grow into — not just keep afloat.

    Yes, switching vendors takes time, effort and sometimes cleanup. But it also gives you a reset — a chance to align your product with where your business is actually going.

    If you’ve hit a ceiling, don’t wait until it becomes a wall. Find a partner who can build what’s next, not just maintain what’s now.

    As a founder, your focus is growth — more users, more features, more market share. But sometimes the biggest thing standing in your way isn’t your business model, marketing or funding. It’s your tech team.

    Not because they’re doing something wrong — but because they’ve taken you as far as they can.

    And when you finally bring in a new team or vendor, it’s a stress test. For the business, it means facing hard questions about control. For the new team, it means diving into someone else’s legacy code. And for you, the founder, there’s one phrase no one ever wants to hear:

    The rest of this article is locked.

    Join Entrepreneur+ today for access.

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    Ilia Kiselevich

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  • What I Learned About Growth From Founders Who Started Small | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    Starting a business with limited resources is a road many solopreneurs find familiar — myself included. I’ve observed many small business owners turning modest startups into success stories, but it doesn’t happen overnight. They turn their humble ideas into successful ventures with resilience, creativity, smart technology use and a never-accept-defeat attitude.

    For this article, I’ll draw on my personal experiences and the stories of five founders who started small. These practical lessons apply to your entrepreneurship journey as well.

    Related: Boost Your Solopreneur Business with These 3 Proven Tips

    Start by solving authentic problems

    Sara Blakely launched Spanx in 2000 when she was under 30 years old and had $5,000 to her name. But her self-employment journey started with a simple notion: her personal frustration with not finding comfortable, flattering undergarments to wear. Even though her idea, which later turned out to be worth $1 billion, was rejected by multiple manufacturers, her conviction kept her persistent until she finally found someone willing to take a chance on her.

    Her story tells me that entrepreneurs must start with a problem they’re actually familiar with and deeply understand. Authenticity resonates with your core audience; it builds trust from day one. When your product stems from your own experiences and frustrations, you create an immediate connection with your would-be buyers, leading to strong word-of-mouth.

    Turn setbacks into stepping stones

    Calling himself a lousy employee, Mark Cuban admits that keeping a steady job was difficult for him. But Cuban never quit on himself and ultimately founded and sold MicroSolutions for $6 million. What I learn from his example is that setbacks are inevitable — and necessary. What matters is how quickly you bounce back from failure and what lessons you learn from your past mistakes.

    The Bureau of Labor Statistics states that 20% of small businesses shut down in a year or so. But successful solopreneurs treat these setbacks as experiments. When you start treating obstacles as stepping stones, you can easily adapt after failure and launch a working product.

    Launch small and use what you have

    Fubu’s founder, Daymond John, started this fashion brand in the 1990s by sewing hats and shirts in his mother’s living room. He didn’t have big budgets or state-of-the-art facilities. But he relied on grassroots marketing and community support to end up selling $6 billion worth of products by 2024, turning a kitchen-based hustle into a global fashion powerhouse.

    John’s story tells me that a lack of capital shouldn’t hold solopreneurs back. Instead, they should fall back on their skills, their immediate network and whatever resources are available at hand. Grit and creativity often outweigh money. This lesson speaks to me personally, since I built Selzy with a minimal viable product while relying on customer feedback for improvement.

    Related: Building Your Business With Limited Resources? Here’s the Mindset You Need to Succeed.

    Embrace digital-first and lean growth

    Automation, social media and efficient scaling. That’s how anyone can launch on budgets under $10,000. Technology lets small businesses thrive and expand into other markets. You can use email marketing tools to reach out to potential leads and advertise your business. Syed Balkhi’s WPForms is a great example here. Balkhi’s WordPress tutorial blog led to the creation of a $1 billion software company, and he did all that without raising a single dollar of his own.

    That’s how many modern-day solopreneurs are scaling past six figures. Technology allows founders to go global earlier than was possible a decade ago. Smart customer segmentation and personalized communication help them drive more engagement. And with the right tools, even small teams working remotely can achieve impressive growth with fewer resources.

    Turn your mistakes into learning opportunities

    Sophia Amoruso’s example teaches us to fuel our future successes with past failure. When her startup, Nasty Gal, became shaky after turning into a $100-million brand, she simply pivoted and launched another brand, Girlboss, a platform focused on redefining success for a new generation of women.

    Solopreneurs must always be ready to reinvent and adapt to changing consumer demands to position their business for long-term relevancy and success. Accepting that my idea didn’t work helps you thrive in a competitive industry.

    Related: How to Turn Your Mistakes Into Opportunities

    Put all these real-life lessons into action

    Growth is about your vision, resilience and continuous learning — the sign of a solopreneur who is ready to bend to fluctuating market standards and customer expectations. In fact, my experience with digital marketing and AI-powered growth tells me that these principles are universally applicable.

    Starting small isn’t a limitation for future-ready solopreneurs; it’s an opportunity to build strong foundations. It’s not how big you start (some of the world’s biggest brands were started by their founders in garages), but you keep learning and moving forward. I’ve tasted defeat and I’ve met setbacks — I recommend adaptability.

    Starting a business with limited resources is a road many solopreneurs find familiar — myself included. I’ve observed many small business owners turning modest startups into success stories, but it doesn’t happen overnight. They turn their humble ideas into successful ventures with resilience, creativity, smart technology use and a never-accept-defeat attitude.

    For this article, I’ll draw on my personal experiences and the stories of five founders who started small. These practical lessons apply to your entrepreneurship journey as well.

    Related: Boost Your Solopreneur Business with These 3 Proven Tips

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    Dmitry Solovyev

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  • Why Did a $10 Billion Startup Let Me Vibe-Code for Them—and Why Did I Love It?

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    Sitting a few feet away was Simon Last, one of Notion’s three cofounders. He is gangly and shy, an engineer who has relinquished management responsibilities to focus on being a “super IC”—an individual contributor. He stood to shake my hand, and I awkwardly thanked him for letting me vibe-code. Simon returned to his laptop, where he was monitoring an AI as it coded for him. Later, he would tell me that using AI coding apps was like managing a bunch of interns.

    Since 2022, the Notion app has had an AI assistant to help users draft their notes. Now the company is refashioning this as an “agent,” a type of AI that will work autonomously in the background on your behalf while you tackle other tasks. To pull this off, human engineers need to write lots of code.

    They open up Cursor and select which of several AI models they’d like to tap into. Most engineers I chatted with during my visit preferred Claude, or they used the Claude Code app directly. After choosing their fighter, the engineers ask their AI to draft code to build a new thing or fix a feature. The human programmer then debugs and tests the output as needed—though the AIs help with this too—before moving the code to production.

    At its foundational core, generative AI is enormously expensive. The theoretical savings come in the currency of time, which is to say, if AI helped Notion’s cofounder and CEO Ivan Zhao finish his tasks earlier than expected, he could mosey down to the jazz club on the ground floor of his Market Street office building and bliss out for a while. Ivan likes jazz music. In reality, he fills the time by working more. The fantasy of the four-day workweek will remain just that.

    My workweek at Notion was just two days, the ultimate code sprint. (In exchange for full access to their lair, I agreed to identify rank-and-file engineers by first name only.) My first assignment was to fix the way a chart called a mermaid diagram appears in the Notion app. Two engineers, Quinn and Modi, told me that these diagrams exist as SVG files in Notion and, despite being called scalable vector graphics, can’t be scaled up or zoomed into like a JPEG file. As a result, the text within mermaid diagrams on Notion is often unreadable.

    Quinn slid his laptop toward me. He had the Cursor app open and at the ready, running Claude. For funsies, he scrolled through part of Notion’s code base. “So, the Notion code base? Has a lot of files. You probably, even as an engineer, wouldn’t even know where to go,” he said, politely referring to me as an engineer. “But we’re going to ignore all that. We’re just going to ask the AI on the sidebar to do that.”

    His vibe-coding strategy, Quinn explained, was often to ask the AI: Hey, why is this thing the way it is? The question forces the AI to do a bit of its own research first, and the answer helps inform the prompt that we, the human engineers, would write. After “thinking,” Cursor informed us, via streaming lines of text, that Notion’s mermaid diagrams are static images that, among other things, lack click handlers and aren’t integrated with a full-screen infrastructure. Sure.

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    Lauren Goode

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  • The Key to Building Effective Corporate-Startup Partnerships | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    Too many corporate-startup partnerships fall apart despite everyone starting out with good intentions. Big companies say they want to work with startups. Startups jump at the opportunity to scale their ideas. But a year later, both sides often walk away disappointed and empty-handed.

    It doesn’t have to be this way. When done right, these partnerships can unlock enormous value that pays off many times over for both sides. But the key word here is partnership. Too often, corporations treat these relationships as transactions, not collaborations. And startups, for their part, don’t always know how to navigate the maze of corporate expectations and politics.

    That may help explain why a 2024 survey of over 800 health-tech decision-makers found that just 15% of corporate-startup collaborations succeed — barely up from 13% five years earlier.

    Here’s what I’ve learned about making corporate partnerships actually work.

    Related: Startups & Corporates: A Symbiotic Relationship

    Don’t go silent after the kickoff

    One of the biggest mistakes I see corporations make is treating the startup business partnership like a box to check. They kick off the project, then walk away and expect the startup to deliver magic. I can tell you: That almost never works.

    Startups thrive on feedback, iteration and course correction. If you leave them alone for months, you risk missing key opportunities to adjust — or worse, ending up with something that doesn’t fit your needs.

    As a startup, don’t be shy about pushing for regular check-ins. Insist on ongoing conversations, even if it feels like you’re nagging. I’ve worked with startups that were afraid to “bother” their corporate sponsor, only to find out months later that they’d gone down the wrong path.

    If you’re not talking, you’re headed for trouble.

    Watch for the “not invented here” syndrome

    Here’s a common attitude trap: Big companies love to say they’re open to outside innovation, but when it comes down to it, I’ve seen many struggle to embrace something they didn’t invent themselves.

    When corporate teams subconsciously (or even consciously) resist integrating the startup’s work because it feels foreign, or simply because of an ego reflex, the “not invented here” mindset is getting in the way of innovation.

    Startups need to pay attention to this dynamic early. Ask yourself: Is your partner genuinely committed to bringing your innovation inside? Do you see them involving their internal teams? Are they championing your work internally?

    If not, that’s a red flag. A partnership where the big company never really intended to adopt your solution is just window dressing and will probably end up being a waste of your time.

    Related: When It Comes to Corporate Partnerships, Remember These 5 Relationship Tricks

    Don’t let your corporation partnership get buried in bureaucracy

    Let’s be honest: Corporations can be slow and bureaucratic. Startups … aren’t.

    I’ve seen great startups get bogged down in legal reviews, compliance checklists and approval processes, draining resources and killing momentum. If you bring all the corporate bureaucracy to a startup, they will fail. Trying to find that balance is really important.

    As a startup, you need to be honest about what your team can handle. If there are just ten of you and the corporate partner is bogging you down in demands like you’re a big vendor with endless resources, speak up. Don’t be afraid to push back and set clear limits. Whether it’s about timelines, resources or anything else, be clear on what you can deliver.

    On the corporate side, the best partnerships happen when the company makes an effort to adapt. Simplify processes and give the startup breathing room to operate. Again, startups beware: If you’re not seeing that kind of flexibility, think carefully about how much you’re willing to tolerate.

    This is even more important as corporate interest in startups grows. In 2023, corporate-backed deals already accounted for 19% of global venture funding, and the numbers are growing. This shows just how much big companies rely on these partnerships to drive innovation and how much is at stake if they fail.

    Redefine what success looks like

    One of the most important mindset shifts for both sides is understanding that success isn’t always about launching a blockbuster product right away.

    In some of the best startup partnerships I’ve been a part of, the immediate result wasn’t a shiny new thing on the market. What we learned from a project often helped us to solve a problem elsewhere. So — it was successful.

    It was learning. It was building capabilities. It was solving problems elsewhere, sometimes in surprising and unforeseen ways, by using what we discovered together.

    I like to say: Don’t measure the partnership just by the end product. Measure it by the progress it enables. By the degree of innovation it brings to your company. That is the kind of mindset that keeps both parties motivated.

    Creating this win-win relationship is important. You can apply that to intellectual property, licensing and credit, for example. Too many partnerships fail because one side tries to squeeze too much value out of the other. The result is that in the end, nobody wins.

    Startups should make sure their corporate partner values the knowledge and connections that come out of the collaboration, beyond the deliverable itself. These expectations need to be managed from the very beginning in open conversations.

    Related: Making Startup-Corporate Partnerships Succeed: The How-To

    What you should take away

    If you’re a startup thinking about partnering with a big company, here’s my best advice:

    • Speak up! Insist on regular meetings as part of the process from day one.

    • Be honest about your capacity and set realistic expectations.

    • Remember: Success is much more than a glossy product launch.

    These partnerships can be transformational. They can open doors you’d never reach on your own — but only if you go in with the right mindset and a true partner.

    If you treat it like an actual collaboration, not just a deal, you’ll unlock opportunities others might miss.

    Too many corporate-startup partnerships fall apart despite everyone starting out with good intentions. Big companies say they want to work with startups. Startups jump at the opportunity to scale their ideas. But a year later, both sides often walk away disappointed and empty-handed.

    It doesn’t have to be this way. When done right, these partnerships can unlock enormous value that pays off many times over for both sides. But the key word here is partnership. Too often, corporations treat these relationships as transactions, not collaborations. And startups, for their part, don’t always know how to navigate the maze of corporate expectations and politics.

    That may help explain why a 2024 survey of over 800 health-tech decision-makers found that just 15% of corporate-startup collaborations succeed — barely up from 13% five years earlier.

    The rest of this article is locked.

    Join Entrepreneur+ today for access.

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    Anantha Desikan

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  • Inside Mastercard’s Q3 acquisition, innovation strategy

    Inside Mastercard’s Q3 acquisition, innovation strategy

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    Two acquisitions and several new products are supporting Mastercard’s ongoing innovation efforts.  “All that we’re doing on strengthening our product solutions and our acquisitions … is going to be the way for us to win,” Chief Executive Michael Miebach said during Mastercard’s Q3 earnings call today.  Mastercard has announced these recent deals:  On Oct. 1: […]

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    Whitney McDonald

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  • Don’t Be Fooled By Overnight Success Stories — Building a Business Takes More Time Than You Think. Here’s How to Play the Long Game. | Entrepreneur

    Don’t Be Fooled By Overnight Success Stories — Building a Business Takes More Time Than You Think. Here’s How to Play the Long Game. | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    In the business world, it often seems like startups go from idea to billion-dollar valuations in the blink of an eye. But these overnight success stories, while inspiring, often mask a crucial truth: Building a great, sustainable business takes time, often much more time than most founders, investors and observers expect.

    Nothing sells better than the idea of a rapid, meteoric rise to success, and we’ve all heard stories of the legends — Instagram went from launch to a $1 billion acquisition by Facebook in just 18 months, Uber achieved a $70 billion valuation in less than a decade, and the idea for Airbnb went from air mattresses on a living room floor to a global hospitality giant in a few short years. But these are exceptions rather than the rule, and they create a distorted view of how long success really takes.

    As a founder turned investor, I’ve built and funded startups that have been very successful. But they took a long time, in some cases over a decade, to get there. And there’s nothing wrong with that. The real secret to building and growing startups lies in the art of patience.

    Related: Overnight Success as a Startup Is Unrealistic — Embrace the Uncertainty and Try This Instead.

    Reality check: The true timeline of startup growth

    The reality for most successful startups is far less glamorous than the companies making headlines and much more time-consuming. When you’re forming a new company, these are the things that take the most time but that you need to prioritize to have a shot at success:

    • Product-market fit: Finding the right product that solves a real problem for a specific market can take years of iteration and pivoting. Take Slack, for example — it started as a gaming company before pivoting to become the workplace communication tool it is today.
    • Revenue generation: Developing a sustainable revenue model often requires multiple attempts and adjustments. Pinterest spent years fine-tuning its monetization strategy before achieving profitability.
    • Scaling: Growing from a small team to a larger organization while maintaining culture and efficiency is a slow, challenging process. Dropbox spent over a decade perfecting its product and scaling its operations before its successful IPO.
    • Market education: For truly innovative products, educating the market and changing consumer behavior takes time. Tesla spent years convincing the market of the viability of electric vehicles before achieving mainstream success.

    I spent eight years at the company I co-founded, Density, and we were hyper-focused on getting these areas of the business right. In the beginning, we tested our idea by manually counting people in a coffee shop and publishing the results online. We initially sold WiFi-based counting solutions to retail businesses, but after receiving feedback and interest from larger organizations, we decided to pivot and focus exclusively on commercial real estate (CRE).

    Along the way, we realized our product wasn’t accurate enough, so we rebuilt it from the ground up. We expanded into mid-market businesses and even found an unexpected use case with airport lounges — if you fly Delta, you’ll probably see one of our sensors above the lounge doors. Eventually, we shifted back to focusing on CRE and changed our business model from a per-sensor fee to a square footage-based software fee because it made the most sense for revenue generation.

    Since I left the company, that journey has continued. This timeline is much more representative of the typical startup experience.

    Related: How Saying ‘Yes’ to Every Opportunity Helped My Startup Make $1 Million in the First Year

    Maintaining momentum over the long haul

    Long timelines without significant milestones can certainly be demotivating to employees and leadership. But there are ways to maintain motivation and momentum for the long haul.

    Set intermediate goals by breaking down the long-term vision into shorter-term, achievable objectives. This will help your team understand that they are making progress even if it’s incremental. I also believe in celebrating small wins. Acknowledge and celebrate the little achievements along the way, no matter how insignificant they might seem.

    It can be difficult to do when you’re grinding hard to make your idea a reality but hear me out — it’s crucial to maintain some semblance of work-life balance. If everyone is working until 9 p.m. and on weekends, they’re going to burn out and be even less likely to stick it out for the long run. Encourage your team to take time off.

    Lastly, stay connected to the mission. Regularly revisit and reinforce the company’s core mission and values because it reminds people why they’re doing the work and why they should continue even when progress feels slow.

    How investors and founders can align on long-term visions

    Building a great startup takes time, and it’s not just you who needs to be patient — your investors have to be on board, too. From the get-go, make sure you’re having honest conversations with them about what the journey is going to look like. Talk about timelines, key milestones and what success really means for your startup.

    It’s crucial to find investors who not only get your industry but also share your long-term vision. It’s important to pursue capital from investors who share your ideology and have a vision for their fund that outlives your business — an investor can only be in it for the long haul if their fund model supports it.

    In general, try to find investors with good track records and some semblance of operating experience. They’ll often have more empathy for the ups and downs of finding market fit or unlocking revenue. Once you have those people in your corner, keep them in the loop with regular, open communication. And don’t just focus on today’s revenue or growth numbers; pay attention to leading indicators, like customer acquisition cost, monthly recurring revenue and user engagement metrics. These are the signs that show you’re on the right track for future success.

    Don’t be shy about asking your investors for help. They bring experience and connections that can be game-changers when things get tough or when you’re looking to scale faster. As a former founder, I try to be a mentor to the companies I invest in. I’m always willing to get into the nitty gritty with founders and help them with operations, brand work, product development and company culture. The more involved your investors are, the better off you’ll be.

    Embracing the long game

    Building a truly great, sustainable business is more a marathon than a sprint. It requires not just ambition and hard work, but also patience, resilience and a willingness to learn and adapt over time.

    For founders, this means setting realistic expectations from the start, both for themselves and for their teams. It means being prepared for the long haul, celebrating the small victories along the way and maintaining focus on the ultimate vision.

    For investors, it means looking beyond the allure of quick returns and being willing to support promising companies through the tumultuous startup journey.

    We also need a mindset shift for the whole industry. We need to celebrate not just the rapid rises, but also the steady, persistent builders who create value over time. By being patient, we can foster a more sustainable startup ecosystem — one where enduring companies create real value for society. The most impactful companies of our time weren’t built overnight. They were built day by day, with patience, persistence and an unwavering commitment to their vision.

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    Rob Grazioli

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  • How to Choose the Right Business Model | Entrepreneur

    How to Choose the Right Business Model | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    Embarking on the entrepreneurial journey is an exhilarating step toward creating a legacy. However, the stakes are high — it’s almost common knowledge that 90% of startups fail. A recent survey by Failory looked into the why behind this number in 2024. Over half of the failed businesses cited marketing failures. Specifically, 34% cited poor market fit as a critical factor.

    This makes selecting the right business model in 2024 more crucial than ever to ensure you’re positioned correctly in the market. Aligning your business model with market demands and personal values is key to avoiding these statistics.

    By exploring the advantages and challenges of various models, from the structured support of franchising to the flexible adaptability of lean startups, it’s important to assess how each aligns with your long-term goals and immediate needs.

    Related: The 7 Elements of a Strong Business Model

    1. The structured approach of franchising

    Franchising offers a structured pathway to business ownership that combines the security of a proven system with the excitement of entrepreneurship. One of the primary benefits of franchising is its turnkey operation. Franchisees are provided with a ready-made business blueprint, significantly lowering the startup failure rate compared to independent ventures. This model comes with established brand recognition and customer loyalty, which can be invaluable assets from day one.

    Take McDonald’s, for example. With over 38,000 locations worldwide, McDonald’s franchisees benefit from the power of a globally recognized brand and a loyal customer base, reducing much of the risk that comes with starting a new business. McDonald’s offers its franchisees extensive training and support, covering everything from store operations to financial management and marketing campaigns. This ensures that franchisees can focus on growing their individual outlets without the burden of building these systems from scratch.

    McDonald’s has perfected this model by streamlining processes and leveraging its vast supply chain. Franchisees get the advantage of bulk purchasing, established suppliers and powerful advertising campaigns. This support structure helps new owners avoid many pitfalls that independent businesses face, such as inconsistent quality or costly marketing efforts.

    However, franchising comes with challenges. In the case of McDonald’s, the initial investment is significant, often ranging between $1.3 million and $2.3 million. Franchisees must also pay ongoing royalties, typically 4-5% of gross sales, which can impact long-term profitability. Additionally, while franchisees benefit from McDonald’s global reputation, they must adhere to strict operational guidelines, leaving little room for creativity or local adaptation. McDonald’s maintains tight control over everything from the menu to store layout, which limits entrepreneurial freedom.

    For entrepreneurs drawn to the structure and support of a well-established brand, franchising can be a less risky pathway to success. However, it’s important to weigh the financial commitments and lack of operational flexibility when considering this model.

    2. The subscription-based model

    Subscription-based models offer several compelling advantages for businesses looking to establish a steady and predictable revenue stream. This model significantly reduces the unpredictability associated with one-time sales by ensuring that revenue is generated on a regular basis through monthly or annual subscriptions. For example, Dollar Shave Club revolutionized the razor industry by offering affordable razors and grooming products directly to consumers via subscription. This not only created a consistent revenue stream but also built strong customer loyalty by delivering products on a recurring basis.

    One of the key benefits of this model is its scalability. Dollar Shave Club demonstrated this by expanding its offerings based on customer feedback, moving from simple razors to a broader range of grooming products. The subscription model allowed the company to scale quickly and efficiently, as it could adjust its services without substantial incremental costs. This adaptability helps businesses respond to market demands and maintain operational efficiency as they grow.

    However, while subscription models like Dollar Shave Club have thrived, maintaining customer retention is an ongoing challenge. To prevent churn, companies must constantly innovate and deliver exceptional customer service. In Dollar Shave Club’s case, they continuously updated their product line and used clever, engaging marketing to keep customers interested and subscribed. This approach helped them avoid high churn rates, but it also required significant investment in product development and customer engagement strategies.

    While the subscription model provides businesses with stable revenue and growth opportunities, it also demands consistent attention to customer satisfaction. Companies need to focus on innovation and customer service to retain subscribers, making the model both lucrative and resource-intensive.

    Related: 4 Effective Business Models That Built Billion-Dollar Companies

    3. The lean startup model

    The lean startup model is highly regarded for its flexibility and cost-effectiveness, making it an attractive option for entrepreneurs aiming to minimize risk while maximizing adaptability. A prime example of this is Dropbox, which used the lean startup approach to become a multi-billion-dollar company. Rather than building a full product from the start, Dropbox launched a Minimum Viable Product (MVP) — a simple video demonstration of its concept. This allowed the founders to gather feedback and gauge interest before committing to full-scale development. The overwhelming response validated the demand for a simple file-sharing solution, and Dropbox quickly grew from a startup into an industry leader.

    By following this lean methodology, Dropbox was able to iterate rapidly, continuously improving its service based on real-time user feedback. This approach minimized upfront investment while ensuring that their product met the needs of the market. As of its 2023 revenue report, Dropbox has reached over 700 million registered users, and its annual revenue was $2.5 billion, demonstrating the power of scaling efficiently using lean principles.

    However, the lean startup model isn’t without challenges. Its iterative nature requires constant adjustments, which can lead to uncertainty and the risk of over-pivoting. While Dropbox managed to scale effectively, frequent product changes can confuse stakeholders or destabilize the business strategy if not carefully managed. Despite these risks, for entrepreneurs who prioritize flexibility and responsiveness, the lean startup model offers a pathway to success with minimal initial investment.

    4. The cooperative business model

    The cooperative business model emphasizes shared ownership and decision-making, fostering a democratic approach to running a business. Each member has a voice in key decisions, promoting transparency and engagement. This model often leads to a strong sense of community and prioritizes long-term value over short-term profits. A prime example is REI (Recreational Equipment, Inc.), a consumer cooperative that has successfully operated under this model for over 80 years. REI’s profits are either reinvested in the business or returned to its members through annual dividends. In 2022 alone, REI returned $234 million to its 23 million co-op members in the form of dividends and member-exclusive discounts.

    One of the major advantages of the cooperative model is the alignment between the business and the community it serves. REI, for instance, focuses on environmental sustainability and local development, ensuring its values match those of its members. This not only creates brand loyalty but also strengthens the cooperative’s long-term sustainability.

    However, there are challenges inherent in the cooperative model. Since profits are distributed among all members, individual financial returns may be lower compared to other business structures. Additionally, decision-making can be slower due to the need for consensus among many members. For REI, balancing its cooperative ideals with financial growth has been crucial to maintaining its success while supporting both the environment and its community.

    Related: How to Navigate Today’s Complex Entrepreneurial Landscape — 4 Strategies for Success

    Choosing the right business model is a cornerstone decision for every aspiring entrepreneur. By considering both the advantages and limitations of each model, entrepreneurs can align their business strategies with their personal values, market conditions and long-term goals, forging a path to success that is both fulfilling and sustainable.

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    John Conway

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  • A High-Profile Geneticist Is Launching a Fusion-Power Moonshot

    A High-Profile Geneticist Is Launching a Fusion-Power Moonshot

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    Eric Lander is a Big Science heavyweight. A geneticist, molecular biologist, and mathematician, he led the International Human Genome Project and is founding director of the powerful Broad Institute of MIT and Harvard. His countless accolades include a MacArthur “genius” grant and 14 honorary doctorates. When Joe Biden became president, he tapped Lander to be his science adviser and the head of the Office of Science and Technology Policy. Lander lost the job because of charges that he bullied subordinates, but he went on to head a nonprofit organization called Science for America.

    So what is he doing running a Silicon Valley startup that aims to solve the climate crisis by realizing the long-held dream of clean fusion energy? Lander is the founding CEO of newly announced Pacific Fusion, heading a team that includes top scientists from the national nuclear labs—Lawrence Livermore and Sandia—as well as experts in simulation and operations. It joins several dozen companies chasing a fusion dream that always seems to be 10 or 20 years out. And it still is—Pacific Fusion says it won’t deliver a working commercial fusion plant until well into the 2030s. But this time there’s a clear path to success. Or so says its famous CEO.

    In May 2023, Science for America issued a report that flagged progress in fusion, citing recent breakthroughs. The year before, a Livermore group achieved what is known as “target gain,” producing significantly more energy than the amount required to perform the experiment. Soon after publishing the paper, Lander quietly formed a company with some scientists in the field, including some who worked at the labs and others from places like Alphabet’s X division and Tesla.

    Sitting in a conference room at Pacific Fusion’s headquarters in Fremont, California, Lander explains to me why commercial fusion is finally within reach—and why Pacific Fusion may have the best chance to make it happen. He starts by giving me a primer on fusion, which happens when hydrogen is, in his word, “squished” into helium, releasing massive amounts of energy. It occurs naturally on the sun and other stars, but humans have yet to figure out how to do it efficiently here on Earth. But the potential payoff—unlimited clean power—has prompted around 50 startups to chase this dragon. Billionaires including Sam Altman and Bill Gates have backed one or another of these startups. Every few months, it seems, one of those contenders announces some breakthrough.

    Why does Pacific Fusion say it’s different? The method it’s pursuing is called pulsed magnetic fusion, which involves inserting tiny containers of deuterium-tritium fuel into a chamber and blasting large electrical pulses through them to magnetically squeeze the fuel containers and achieve fusion. (It’s all explained here in a paper.) “It’s a very attractive approach that’s sort of been known for decades as an idea but has only just become feasible in the last two years because of this work in the national labs,” says Lander. His contention, which I will hear repeatedly as I meet with his team, is that we’ve now made all the scientific breakthroughs we need to understand how to use this technique to generate way more energy that it takes to build and run this system. The remaining challenges—hard ones to be sure— lie in engineering.

    Another challenge is getting the money to build the prototypes for the hundreds of commercial plants that will theoretically solve the world’s energy woes. (And maybe cause global disruption when the current suppliers are upended, but that’s another story.) How do you fund a moonshot? Even when an investor accepts the risk, the prospect for payoff is distant: The Pacific Fusion timeline is to have a full-scale demonstration system sometime in the early 2030s, and commercial systems later in the decade.

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    Steven Levy

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  • How to Build a Thriving Business Without Venture Capital | Entrepreneur

    How to Build a Thriving Business Without Venture Capital | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    After recent conversations with Y Combinator alumni and other promising entrepreneurs, I hear many of them have no plans to raise venture capital — ever. While raising funds is often crucial, bootstrapping is an approach every entrepreneur should consider.

    Contrary to the “move fast and break things” mantra that echoes through Silicon Valley, bootstrapping often means adopting a steady and deliberate approach. This allows for a deeper understanding of your market and more meaningful connections with early customers.

    For instance, instead of chasing rapid growth, Tuple focused on building a product users would truly love. Their strategy revolved around a relentless focus on user feedback and incremental improvements. By prioritizing the quality of their screen-sharing functionality, a critical feature for developers, over the rapid expansion of their feature set, they created a loyal user base that fueled organic growth.

    Related: What I Wish I Knew Before Bootstrapping My Startup

    Steering your own ship

    Bootstrapping isn’t just about money; it’s about maintaining the purity of your vision. When you bootstrap, you retain complete control over your company’s direction, culture and values. This autonomy can be invaluable, especially if your vision doesn’t align with typical investor expectations.

    Keep in mind that maintaining control doesn’t always mean rejecting all external input. Mailchimp, which bootstrapped its way to a $12 billion acquisition by Intuit, did seek advice from outside experts. The difference was that the founders had the freedom to choose when and how to implement this advice.

    Can your model fuel itself?

    The ideal bootstrap-friendly business generates revenue quickly and requires minimal upfront investment. This often leads bootstrapped startups to focus on solving immediate, painful problems for customers willing to pay for solutions.

    Gumroad, a platform for creators to sell products directly to consumers, built its business model around immediate monetization. Gumroad aligned its success directly with its users by taking a small cut of each transaction.

    Being bootstrap-friendly often requires creativity in finding ways to generate early revenue. Pieter Levels, founder of Nomad List, bootstrapped his company by creating multiple small products and services for digital nomads. This diversified approach allowed him to generate revenue streams that collectively funded the growth of his main platform.

    Related: Bootstrapping vs. Seeking Venture Capital — How to Decide the Best Avenue for Your Business

    Walking the line between brave and foolish

    Bootstrapping often means betting on yourself — sometimes quite literally. It requires balancing necessary risks and avoiding reckless gambles. This often involves personal sacrifices and a willingness to operate with a much thinner safety net than funded startups.

    When Sara Blakely started Spanx, she kept her day job selling fax machines while developing her product at night and on weekends. She invested her entire $5,000 savings and even wrote her own patent to save on legal fees.

    The key is to be realistic about your risk tolerance and financial situation. It’s about finding creative ways to extend your runway and validate your ideas before going all-in. This might mean starting as a side project or finding ways to generate supplementary income that aligns with your long-term goals.

    Building big while starting small

    One of the most pervasive myths in the startup world is that certain ideas require massive scale from day one, necessitating significant upfront investment. However, numerous examples prove that it’s possible to build a large, impactful company from humble beginnings.

    Shopify, which now powers over a million businesses, started as a simple online store for snowboarding equipment. They bootstrapped the company initially, only seeking outside investment after they had a proven product and clear market demand.

    This paradox is often resolved by focusing on a specific, underserved segment of your target market. By dominating this niche, you can build the resources and reputation necessary to expand into adjacent markets or scale up to serve larger clients.

    Turn constraints into advantages

    One of the most powerful aspects of bootstrapping is how it forces creativity and efficiency. With limited resources, bootstrapped startups often find innovative solutions that end up becoming key competitive advantages.

    Referring to Basecamp’s journey again, their limited resources led them to focus on doing a few things exceptionally well rather than trying to match every feature of their competitors. This constraint-driven innovation resulted in a product known for its simplicity and ease of use — qualities that became major selling points.

    Related: Starting a Business? Before You Seek VC Money, Here’s Why Bootstrapping May Be the Better Choice.

    Building a team with more than money

    One of bootstrapped startups’ biggest challenges is attracting and retaining top talent without high salaries and extensive benefits packages. However, many bootstrapped companies have found innovative ways to build strong teams despite these constraints.

    By openly sharing the company’s revenue, salaries and equity distribution, Gumroad attracted talent that was aligned with their values and excited by the opportunity to work in such an open environment.

    Many top performers are motivated by factors beyond just salary. Autonomy, mastery, purpose and work-life balance can be powerful attractors, especially for those disillusioned with the high-pressure environments often found in heavily funded startups.

    Defining success on your terms

    The bootstrap path can lead to unexpected and often more favorable exit opportunities. When you bootstrap, you retain more equity and have more control over the timing and terms of any potential exit.

    When Intuit acquired Mailchimp for $12 billion, the founders owned 100% of the company, a feat unheard of in tech unicorns. Their bootstrap journey allowed them to grow the company at their own pace and exit on their own terms.

    An “exit” doesn’t necessarily mean selling or going public. Success can be defined in many ways — building a profitable business that supports your desired lifestyle, creating a company that makes a positive impact on the world, or, yes, eventually selling for a significant sum.

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    Arian Adeli

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  • AI Startups Raised $2.9 Billion in Three Months—Here’s Why | Entrepreneur

    AI Startups Raised $2.9 Billion in Three Months—Here’s Why | Entrepreneur

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    OpenAI recently secured $6.6 billion in funding at a valuation of $157 billion, but it’s far from the only AI company with high fundraising potential. Investors poured $2.9 billion from July to September (Q3) of 2024 into the latest U.S.-based AI startups, per PitchBook data.

    The three startups in the U.S. that received some of the most funding were software development AI startup Magic, enterprise ChatGPT startup Glean, and AI document search startup Hebbia, per TechCrunch. The three raised $320 million, $260 million, and $130 million respectively in the third quarter.

    Magic is creating AI that can write code and Glean is working on an AI search app for businesses. Hebbia focuses on AI agents for finance, law, and big companies.

    An earlier PitchBook report from August shows that investor interest in AI is long-term and extends beyond the last quarter. The report showed that AI comprised 41% of U.S. VC deals in the first half of 2024, with $38.6 billion of the $93.4 billion total in VC deals going to AI startups.

    Related: AI Startups Raised $50 Billion Last Year, But Some Investors Are Starting to Pass — Here’s Why

    Going back further to last year, AI was one of the few industries with the most growth in unicorn startups, or businesses with a valuation over $1 billion. In an otherwise tough fundraising year, the number of AI unicorns grew by 22.9%.

    Even as it presents opportunities, AI carries its own unique set of challenges. For one, the cost of developing an AI model is high. Anthropic CEO Dario Amodei stated in July that it would take $10 billion to train AI “better than most humans at most things.” He estimated that AI companies would reach that point within the next three years and that now it takes about $100 million to train an AI model.

    AI also has a hefty electric bill. Microsoft, Google, and other big tech companies are turning to nuclear power as a source of carbon-free energy; AI helped increase Google’s greenhouse emissions by 48% within four years.

    Still, AI remains an area of high interest among founders. 156 out of the 208 startups accepted to the summer class of Y Combinator, an acclaimed startup accelerator, focused on AI.

    Related: Y Combinator Helped Launch Reddit, Airbnb and Dropbox. Here’s What I Learned From Its Free Startup School.

    One startup founder not affiliated with Y Combinator, Sahil Agarwal of AI safety startup Enkrypt AI, talked to Entrepreneur earlier this year about the dangers and opportunities AI poses.

    “What ChatGPT did is it made AI real for everyone,” he said.

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    Sherin Shibu

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  • Why VCs are suddenly hot on photonics startups

    Why VCs are suddenly hot on photonics startups

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    Oriole Networks, a British company with plans for a completely new networking infrastructure for AI supercomputing clusters that is based on using light instead of electricity to transmit data, has raised $22 million from the London-based venture capital firm Plural.

    Photonics, which is the science of generating, manipulating, and detecting light, is suddenly a hot topic in the tech industry as a potential solution to two big problems facing AI data centers: their colossal electricity demands and the time it can take train the largest AI models on massive datasets. Just this week, two other companies working on photonic networking for AI chips announced major funding rounds.

    Lightmatter, announced it had raised $400 million in a venture capital deal led by T. Rowe Price that values the seven-year-old company at $4.4 billion. And Xscape Photonics announced it had closed a $44 million investment round led by IAG Capital, with the venture capital arm of network equipment maker Cisco and Nvidia among its other investors.

    No valuation figures were announced as part of either Xscape’s or the Oriole Networks’ fundraises, both of which were Series A rounds.

    The reason photonics is suddenly in vogue has to do with a series of challenges tech companies are encountering as they seek to build ever larger data centers stuffed with hundreds of thousands of specialized chips—in most cases, graphics processing units (or GPUs)— used for training and running AI applications.

    Conventional networking and switching equipment, which primarily uses copper wiring through which electricity is passed to convey information, is itself becoming a bottleneck to how quickly and easily large AI models can be trained. In other cases, fiberoptics are used, but with only a few colors of light traveling in a single cable, which also constrains how much information can be transmitted.

    AI models based on neural networks must shuttle a lot of data continuously back and forth through the entire network. But moving all this data between GPUs, including those that might be located in distant server racks, depends on wiring pathways and the capacity of switching equipment to send data zipping to the right place.

    The way many large AI supercomputing clusters are wired, data traveling from one computer chip to another located elsewhere in the cluster, might have to make as many as nine hops through different network switches before it reaches its destination, George Zervas, Oriole Network’s cofounder and chief technology officer, said.

    The larger the AI model and the more server racks involved, the more likely it is that this roadway of wiring will become congested, similar to how traffic jams delay commuters. For the largest AI models, 90% of their training time can consist of waiting for data in transit across the supercomputing cluster as opposed to the time it actually takes the chips to run the necessary computations.

    Conventional networking equipment, which uses electricity to transmit data, also contributes significantly to the energy requirements of data centers, both by directly consuming power, and because the copper wiring dissipates heat, meaning more energy is required to cool the data center. In some data centers, the networking equipment alone can account for 20% of the facility’s overall energy consumption.

    Depending on what energy source is used to power the data center, this electrical demand can result in a colossal carbon footprint. Meanwhile, many data centers require vast quantities of water to help cool the racks of chips used to run AI applications.

    Cloud computing companies are anticipating power needs for future AI data centers that are driving them to extreme lengths to secure enough energy. Google, Amazon, and Microsoft have all struck deals that would see nuclear reactors dedicated solely to powering their data centers. Meanwhile, OpenAI had briefed the U.S. government on a plan to possibly construct multiple data centers that would each consume five gigawatts of power annually, more than the entire city of Miami currently does.

    Photonics potentially solves all of these challenges. Using fiberoptics to transmit data in the form of light instead of electricity makes it possible to connect more of the chips in a supercomputing cluster directly to one another, reducing or eliminating the need for switching equipment. Photonics also uses far less electricity to transmit data than electronics and photonic signals produce no heat in transit.

    Different photonic companies have different ideas about how to use the technology to revamp data centers. Lightmatter is creating a product called Passage that is a light-conducting surface onto which multiple AI chips could be mounted, allowing photonic data transmission between any of the chips on that Passage surface without the need for cabled connections or copper wiring. Fiberoptic cabling would then be used to connect multiple Passage products in a single server rack and for the connections between racks. Xscape envisions using photonic equipment and cabling that can transmit and detect hundreds of different colors of light through a single cable, vastly increasing the amount of data that could flow through the network at any one time.

    But Oriole Networks’ may have the most sweeping vision, using photonics to connect every AI chip in a supercomputing cluster to every other chip in the entire cluster. This could result in training times for the largest AI models—such as OpenAI’s GPT-4—that are up to 10 to 100 times faster, Oriole Networks said. It can also mean networks can be trained using a fraction less power than today’s AI supercomputing clusters consume.

    To accomplish this, Oriole envisions not just new photonic communication equipment but also new software to help program the network, and a new hardware device that can act as the “brain” for the entire network, determining which packets of information will need to be sent between which chips at exactly what moment.

    “It’s completely radical,” Oriole CEO James Regan said. “There’s no electrical packet switching in the network at all.”

    Oriole Networks was spun-out from University College London in 2023, but it relies on technology that its founders, in particular Zervas, pioneered over the past two decades. In addition to Zervas, who is a veteran photonics researcher, UCL PhD. student Alessandro Ottino and post-doctoral fellow Joshua Benjamin, who is an expert in designing communication networks, cofounded the company. They brought on Regan, an experienced entrepreneur who helped create a previous photonics company, as CEO.

    The company currently employs 30 people. It raised an initial Seed funding round of $13 million in March from a group of investors that includes the venture capital arm of XTX Markets, which operates one of the largest GPU clusters in Europe. UCL Technology Fund, XTX Ventures, Clean Growth Fund, and Dorilton Ventures also all participated in both the Seed round and the most recent Series A investment.

    Regan said that Oriole is using other companies to manufacture the photonic equipment it is designing, which will enable the company to keep its capital requirements lower than would otherwise be the case and enable the company to move faster. He said it aims to have initial equipment with potential customers to test in 2025.

    The company has held discussions with most of the “hyperscale” cloud service providers as well as a number of semiconductor companies manufacturing GPUs and AI chips.

    Ian Hogarth, the partner at Plural who led the Series A investment, said that he was drawn to Oriole Networks because it represented “a paradigm shift” rather than an incremental approach to making AI data centers more energy and resource efficient. Hogarth, who is also the chair of the U.K.’s AI Safety Institute, said he was impressed by the “raw ambition and speed that [Oriole’s] founders have brought to the problem.”

    He said the company fit in with other investments Plural has made into companies helping to combat climate change. Finally, he said he felt it was important for Europe “to have really hard assets when it comes to the evolution of the compute stack, and to not squander the opportunity to translate brilliant inventions from European universities, UK universities, into iconic companies.”

    Of course, there’s been hype about photonics before, and it hasn’t always panned out. During the first internet boom of the late 1990s and early 2000s, there was also great excitement about the possibility of photonics to become the primary backbone for the internet, including for switching equipment. Venture capitalists back then also poured money into the sector. But most of those investments failed to pan out because of a lack of maturity in the photonics industry. Parts were difficult and expensive to manufacture and had higher failure rates than semiconductors and more conventional electronic switching equipment. Then, when the dot com bubble burst, it largely took the photonics boom down with it.

    Regan says that things are different today. The ecosystem of companies making photonic integrated circuits and photonic equipment is more robust than it was and the technology far more reliable, he said. A decade ago, a company like Oriole Networks would have had to manufacture much of the equipment it wants to produce itself—a much more capital intensive and risky proposition. Today, there is a reliable supply chain of contract manufacturers that can execute designs developed by Oriole, he said.

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    Jeremy Kahn

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  • The Hottest Startups in Berlin in 2024

    The Hottest Startups in Berlin in 2024

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    German innovation is not limited to the country’s capital. In fact, some of this year’s most prolific startups are based hundreds of miles away. The AI startup Alpha Alpha hails from Heidelberg. Helsing, which sells AI to Europe’s militaries, was set up in Munich. Yet both companies operate Berlin offices. The city attracts too much talent to ignore. Universities, such as TU Berlin, churn out Generative AI founders and the capital is such a magnet for international talent that many offices operate in English, not German.

    It’s also a very young city—half of its population is under 45, something that Thomas Dohmke, CEO of GitHub, who grew up in Berlin, remarks on. “I founded my last startup back in 2009 and I remember vividly how much energy, time, and focus it required—having a large population of younger, diverse and international, and highly motivated professionals that have that energy and hunger gives Berlin an edge,” he says. “Plus, Berlin has the best döner kebab.”

    BlueLayer

    By 2050, the carbon credit market is expected to be a $250 billion industry. Startup BlueLayer is catering to that growth by developing tailor-made software for the companies and NGOs poised to benefit. Its clients—including conservationists such as Permian Global—run projects ranging from reforestation to direct air capture, and use the startup’s software to process their data, and communicate with buyers and investors, while helping credit providers get their credits verified with international registries. Launched in 2022, BlueLayer has raised $10 million (€8.9 million) in investment and counts three of the top 10 issuers of credits globally among its clients. “It’s classic automation software,” says Vivian Bertseka, one of BlueLayer’s three co-founders along with Alexander Argyros and Gerardo Bonilla, “but for an industry that used to operate almost exclusively on Excel.” bluelayer.io

    Cambrium

    Cambrium, founded in 2020 by Mitchell Duffy and Charlie Cotton, is using AI to design proteins such as collagen. Instead of sourcing them from animal products, the startup grows them in tanks. “We’re one of the companies trying to straddle hardcore software engineering [and AI] with putting physical stuff in the real world,” says Cotton. The company has received $11.6 million (€10.3 million) in investment so far, including from Google’s AI venture fund Gradient Ventures. Skincare products using Cambrium’s first protein, a collagen called NovaColl, are expected to hit shelves later this year. Cambrium.bio

    Jina AI

    In 2020, three veterans of Chinese tech behemoth, Tencent, joined forces to build foundation models specifically for search. Attracted to Berlin by the city’s open source culture and software engineering talents, the trio behind Jina now claim 9,000 users and 400 paying customers, who turn to the company when they want to build either a public or internal search system for their data. Jina’s models promise to convert PDFs, Word documents or images into a language that AI models can understand well enough to enable an intuitive Google-style search. A legal company may no longer have to search for documents using a case number. Instead, Jina AI CEO and co-founder Han Xiao explains that they could simply ask: “Find the case where Microsoft loses to Google”. After raising $39 million (€34.8 million) from a series of early stage VC funds including Canaan Partners, Xiao and his co-founders Nan Wang and Bing He plan to expand to the US, raise revenue from the company’s $500,000 (€447,000) per year, and boost user numbers. “We want to compete with OpenAI,” says Xiao. jina.ai

    Han Xiao, cofounder of custom search-engine firm Jina AI.

    PHOTOGRAPH: THOMAS MEYER

    Endel

    Endel is a paid-for app that uses generative AI to create one endless piece of music, which constantly adapts to its user’s surroundings. The app utilizes the phone accelerometers to generate a beat that syncs with its listeners’ footsteps. If they start jogging or skipping, the tempo catches up. Calling itself a “sound wellness” startup, Endel is part of the trend for functional sound, where music has a purpose—to help people exercise, fall asleep or focus. “We want to create a technology that harnesses the power of sound and helps you achieve a certain cognitive state,” says CEO Oleg Stavitsky, one of Endel’s six co-founders. Launched in 2018, the company has since raised $22.1 million (€19.1 million) in funding, including from Amazon’s Alexa venture fund, and claims one million monthly active users. In 2023, the company struck a deal with Universal Music Group to use their technology to create new “soundscapes” using established artists’ work. endel.io

    Slay

    To understand Slay’s success, credit has to be given to Pengu, the company’s virtual pet app that has become the startup’s most popular product with more than five million users. Founded by Fabian Kamberi, Jannis Ringwald, and Stefan Quernhorst, Slay created Pengu to be part game, part social platform, where friends or couples can collaboratively raise a digital penguin. The company, which has raised $7.6 million (€6.8 million) in total, including from Accel, is currently scaling Pengu’s ability to personalize its interactions, hooking a series of LLMs to a 3D engine to create that visual experience. Pengu might respond to a child telling them they are being bullied by gifting them a drawing or sending personalized notifications to cheer them up. slay.cool

    Ovom Care

    Ovom Care is a fertility startup using data and machine learning to take the guesswork out of reproductive medicine. Since launching in 2023, co-founders Felicia von Reden, Cristina Hickman, and Lynae Brayboy have opened the company’s first fertility clinic in London—sidestepping the onerous regulatory process in Germany—and already claim to be treating hundreds of people. Alongside the physical clinic, patient app and clinic management system, Ovom also offers machine-learning algorithms that analyze patients’ blood tests, data from wearables, gamete analysis and ultrasound images to tailor the type and timing of treatment. “We’re now going into the era of precision medicine,” says CEO von Reden. “We’re tailoring [fertility] using technology”. That idea has attracted €4.8 million ($5.3 million) in seed funding led by Alpha Intelligence Capital. Within the next year, the company plans to attract medical tourists from all across Europe to its second clinic in Portugal, where treatment costs are expected to be cheaper. ovomcare.com

    Image may contain Person Teen Sitting Swing Toy Accessories Jewelry Ring Necklace Clothing Footwear and Shoe

    Felicia von Reden, founder and CEO of Ovom Care.

    PHOTOGRAPH: THOMAS MEYER

    Dryad

    When Carsten Brinkschulte’s daughter started protesting against climate change in 2018, the serial telecoms entrepreneur started to think about how he could leverage his experience for the good of the planet. The result was a startup called Dryad, launched in 2020, designed to be an early wildfire detection network. “Think of us like the Vodafone of the forest,” says Brinkschulte, one of the company’s seven co-founders. Dryad’s solar-powered mesh networks enable sensors to send alerts when they detect fire, even in remote areas where there is no signal. So far the company has sold 20,000 wildfire sensors and related hardware to 50 countries across the world, from Canada to Thailand, and to clients ranging from local governments to utility companies that want to protect their infrastructure from an inferno. Dryad has raised €22 million ($24.6 million) so far, including from German deep tech fund eCAPITAL. dryad.net

    UltiHash

    The rise of energy-hungry AI prompted the International Energy Agency to warn that the electricity consumed by data centers could double in just two years. As environmental groups discuss the risk that the technology poses to the climate, startup Ultihash has been developing a practical way to slash the data center needs of companies performing energy-intensive machine learning or training their own models. Founded in 2022, Ultihash has developed an algorithm that CEO and co-founder Tom Lüdersdorf claims can slash companies’ data storage needs by up to 60 per cent, meaning they need less data center space and reduce their carbon footprint. The company has raised $2.5 million (€2.2 million) despite still being in stealth mode. Lüdersdorf plans to launch the product later this year, after beta testing with more than 300 companies. ultihash.io

    TheBlood

    According to TheBlood’s co-founders, Isabelle Guenou and Miriam Santer, menstrual blood is an under-appreciated asset for diagnostics, containing data-rich endometrial tissue, live cells, immune cells and proteins, which are not found in ordinary blood. The pair launched the company in 2022, with the aim to use menstrual blood in an attempt to fill healthcare’s gender data gap. Since then, the firm has analyzed more than 1,000 menstrual blood samples, selling testing kits for between €35 ($39) and €120 ($133) to women who are looking for more data to inform fertility or endometriosis treatment. TheBlood also plans to license biomarker analysis or data sets to pharmaceutical companies. So far, the company has raised €1 million ($1.1million) in total, including from healthcare-focused venture firm ROX Health. theblood.io

    Qdrant

    To create generative AI, algorithms have to infer relationships between data—text, images or audio—that isn’t labeled or organized. That’s where so-called vector databases come in, helping developers extend the long-term memory of LLMs by making it easier for those models to search and analyze large amounts of data, while keeping computational costs down. Launched in 2021 by co-founders André Zayarni and Fabrizio Schmidt, Qdrant is catering to AI software developers, promising a vector search engine and database for unstructured data with an easy-to-use API. In the past three years, the company has reached 7 million downloads and 10,000 users worldwide, raising $37 million (€33.2 million) in the process including from US venture capital firm Spark Capital. qdrant.tech

    This article first appeared in the November/December 2024 edition of WIRED UK.

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    Morgan Meaker

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  • The Hottest Startups in London in 2024

    The Hottest Startups in London in 2024

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    In the “Startup-up, Scale-up” review report published last year, chancellor Rachel Reeves promised to make Britain the “high growth, start-up hub of the world”. Now, almost six months into the new government, entrepreneurs remain encouraged by the promises made in the Labour manifesto. “The ambition embodied in Great British Energy and the 2030 decarbonization targets is precisely what we need and deserve,” says Shilpika Gautam, CEO of greentech startup Opna, about Labour’s energy policies. “It’s high time the UK caught up with the policy and financing innovations in other countries, such as the Inflation Reduction Act in the US.”

    Amit Gudka, founder of Field, agrees: “We welcome Labour’s plans to double onshore wind, triple solar and quadruple offshore wind by 2030. These plans are ambitious, but not unrealistic, provided the Government continues to make clear policy decisions and create a stable policy and regulatory environment.” Other sectors, such as healthcare, share the same cautious optimism. “Labour do have a greater political mandate to genuinely reform the NHS, and Wes Streeting in particular seems pragmatic,” Meri Beckwith, co-founder of Lindus Health, says. “He’s signaled a greater willingness to work with private companies to address some of the really big challenges facing the NHS.”

    Expectations are, of course, tempered by the reality left behind by 14 years of Conservative government. For instance, in June, the UK government already had to shelve a £1.3 billion ($1.7 billion) commitment for tech and AI projects made by the previous government because no money had ever been allocated for it. “We should hope that UK industry and academia will find other avenues to mobilize the resources to build that infrastructure,” says Robin Tuluie, founder and CSEO of PhysicsX. “We don’t envy the very hard fiscal choices that the chancellor and the Labour government have to make.”

    Robin AI

    Robin AI is building an AI legal assistant that can help anyone to solve their legal problems. “I wanted to make law more accessible,” says Richard Robinson, a former corporate lawyer at Boies Schiller Flexner, and CEO of Robin AI. “We’re not here to pad out the billable hours business model of big law firms. We’re legal AI for business, not just AI for law firms.” Co-founded in 2019 by Robinson and machine learning researcher James Clough, Robin’s legal assistant is already used by hundreds of businesses like PepsiCo, PwC and Yum! Brands. Its latest product, Robin AI Reports, can, according to Robinson, analyze hundreds of legal contracts and generate single reports in minutes, allowing companies to complete legal processes that used to take weeks—for instance, M&A Due Diligence—in a matter of hours. The company has raised $26 million (£19.8 million) by Singapore-based Temasek and has recently opened an office in Singapore, adding to its offices in London and New York. robinai.com

    Gaia Family

    “I challenge you to find one fertility clinic website that doesn’t show a baby in a blue blanket front and center,” says Nader AlSalim, CEO of Gaia Family. “But how you get to that baby—and more importantly if you ever get to it— is a lot less straightforward.” AlSalim speaks from first-hand experience: his wife underwent five rounds of IVF during three years until they had a child. “There’s a lack of transparency regarding clinical outcomes and treatment prices,” he says. “People start IVF without knowing where the total bill is going to land or how far they’ll be able to go.” AlSalim launched Gaia to address those problems: the startup takes upfront payments from clients and handles all costs for up to three cycles of IVF. Clients only pay back later, in installments, if they become parents. “We apply machine learning to large public datasets to predict fertility treatment outcomes and take on the financial risk if those treatments are unsuccessful,” AlSalim says. The startup, which has raised more than $23 million (£17.5 million), is available in the UK, Spain, Greece and the US. gaiafamily.com

    Get Harley

    “I suffered from acne, seborrheic dermatitis, and eczema at various stages of my life,” says Charmaine Chow, CEO of GetHarley. “In the past, I wasted huge amounts of time, money and energy trying to figure out what works for me. I imagined a service that would enable me to meet practitioners online and would deliver the difficult-to-access, medical grade products to my door in a timely manner.” That service didn’t exist, so Chow decided to invent it. GetHarley, the online consultation and clinician matching platform she launched in 2019, currently gives more that 150,000 patients access to a network of 1,500 skincare practitioners across the UK and Ireland. “We have seen triple-digit annual growth since our launch,” she says. “We also partner with more than 500 pharma brands, which allows practitioners to be brand agnostic when they are curating personalized skincare plans.” In August 2024, the company raised $52 million (£39.6 million), led by Index Ventures. getharley.com

    Charmaine Chow, founder and CEO of GetHarley.

    PHOTOGRAPH: JACK LAWSON

    Lindus Health

    “When I was a VC investor, all the techbio companies I met shared the same frustration with clinical trials,” says Meri Beckwith, co-founder of Lindus Health. “They were late, over budget and getting exponentially more expensive. No one could really explain to me why.” Beckwith eventually realized that the culprits were the so-called contract research organizations (CRO), third-party entities that oversee and run clinical trials. “I was told that they make more money the worse the clinical trial goes,” Beckwith says. “That’s the industry’s dirty secret.” Lindus Health, founded by Beckwith and Michael Young, replaces the traditionally old-fashioned methods used by CROs with a technology platform that automates many of the phases of a clinical trial. This allows them to complete trials, on average, in half the time they usually take. “One example is real-time trial monitoring, which takes up to half of the trial’s budget,” he says. “CROs do this by physically sending someone to sites to examine paper records. Our software captures that data directly.”Lindus, which has raised $18 million (£13.7 million), has already been involved in 91 trials. lindushealth.com

    Field

    Field’s big batteries allow electricity grids to store renewable power when supply is high and release it when there’s demand. The company was founded in 2021 by former Bulb co-founder Amit Gudka. A year later, it switched on its first 20MWh battery storage site in Oldham, Greater Manchester. “That played an important part in keeping supplies steady and the lights on in the build-up to Christmas last year, when a large subsea cable transporting power between the UK and France tripped,” Gudka says. “It would have led to instability across the grid were it not for a number of batteries across the country, including ours.” The startup uses lithium-iron phosphate cells, sourced from a Chinese manufacturer, while other battery components are imported from Europe. The startup has raised £200 million ($152.4 million) from DIF Capital Partners and already has a presence in Italy, Germany and Spain. Three sites across Britain, totalling 190MWh, are currently in construction. field.energy

    Opna

    In 2017, Shilpika Gautam became the first person to stand-up paddle the entire length of the river Ganges. “On my expedition, I was introduced to renewable energy and forestry project developers who consistently shared the same challenge: they needed upfront financing to get started,” Gautam says. In 2022, she launched Opna, a platform that allows corporations that want to find, fund and monitor carbon removal projects. “Our mission is to unlock capital for high-quality climate projects that address climate change with speed, scale, and equity,” she says. So far, it has worked with more than 45 projects, in sectors such as agroforestry, blue carbon, biochar and direct air capture, generating more than $340 million (£401 million) in carbon credits. “We verify the integrity of information provided by suppliers and review all the risks associated with a project,” she says. “Our standardized diligence, contracting, and portfolio management tools can save buyers hundreds of thousands of dollars in costs, shrink deal timelines, and de-risk net-zero journeys by actively managing carbon removal portfolios for several years.” Opna has raised a seed round of $6.5 million (£7.6 million) led by Atomico. opna.earth

    Image may contain Blouse Clothing Face Head Person Photography Portrait Nature Outdoors Pond Water and Plant

    Shilpika Gautam, CEO and founder of climate fintech, Opna.

    PHOTOGRAPH: THOMAS MEYER

    Sylvera

    Sylvera verifies and rates the performance of carbon offsetting projects, helping corporate buyers make more informed decisions when purchasing carbon credits. The platform uses machine learning algorithms to assess factors such as the project’s carbon impact and accuracy of reporting based on a range of datasets from satellite data to LIDAR (light detection and ranging) scans. “We’re obsessed with getting project ratings right,” Allister Furey, CEO of Sylvera, says. “We spend up to 120 hours putting together every project rating and analysis, which includes rounds of testing to ensure we’ve come to the correct conclusion.” In May, it launched the Sylvera Catalog, which gives investors access to an overview of nearly 20,000 projects, from biochar to landfill methane. In July 2023, the company raised $57 million (£43.4 million) in series B funding led by Balderton Capital, taking its total external investment to $96 million (£73 million) since being founded in 2020 by Furey and Sam Gill. sylvera.com

    PhysicsX

    PhysicsX uses machine learning to run simulations for engineers in industries such as aerospace, automotive, energy and semiconductors. “AI-driven physics and chemistry simulation will fundamentally transform complex engineering and manufacturing,” says Robin Tuluie, CSEO of PhysicsX. “Our technology replaces standard simulation models with Large Physics Models. These models are as accurate as numerical simulation, but execute in a second or less. We’re talking about speeding up physics simulation by 104-105 times.” Although they can’t disclose names, Tuluie says clients already include a top Formula One team and major automotive and renewables companies. Founded by Tuluie, an astrophysicist and former chief scientist at Mercedes F1 team, and Jacomo Corbo, co-founder of data agency QuantumBlack, the startup has raised $32 million (£24.3 million) in funding led by General Catalyst. physicsx.ai

    Newcleo

    Nuclear technology startup Newcleo is developing a mini nuclear power plant which uses nuclear waste as fuel. Founded in 2021 by physicist Stefano Buono, the startup has already raised more than €400 million (£338.8 million) and employs more than 750 people located in fifteen offices across the UK, France, Switzerland and Italy. In 2024, NewCleo dropped plans to build a power plant in Cumbria, opting instead to invest £4 billion (€4.7 billion) in the south of France following personal lobbying from French President Emmanuel Macron. A demonstration model is currently being built in Italy and the first 30 MW prototypes are planned for 2030. newcleo.com

    Volt

    Volt is an open payments platform that enables merchants to receive direct payments in real-time. “I saw an industry that was ripe for disruption, based on technologies imagined and implemented in the 50s,” Tom Greenwood, CEO of Volt, says. “I could see that there was a new generation of payment infrastructure coming that was real-time.” Founded by Greenwood, Steffen Vollert and Jordan Lawrence, Volt is live today across 31 countries, including Europe, the UK, Brazil and Australia. In June last year, they raised a $60 million (£45.7 million) Series B led by IVP. Clients include FarFetch, Robinhood, Next, KLM, Air France and Xe.com. volt.io

    This article first appeared in the November/December 2024 edition of WIRED UK.

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    João Medeiros

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