Hey — It’s Nico.

Today’s issue takes 5 minutes to read. If you only have one, here are the five main things:

• Koo, the Indian Twitter, has shut down. (read why below).

• Noplace, a blend of Twitter and Myspace, hits No. 1 on the App Store.

• OpenAI and Arianna Huffington are collaborating on an 'AI health coach'.

• AI startup for document search Hebbia raises $130M from a16z.

• Robotaxis are becoming more common and growing in popularity (read more below).

This issue is brought to you by Intercom, the AI-first customer service platform, now offering a 100% discount to startups.

Let’s get into it.

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This Week In Startups

🔗 Resources

Start or scale your SaaS with Zero to SaaS, the all-in-one course and community (500+ founders) of serial SaaS entrepreneur Mike Strives.*

How PostHog got their first 1000 users.

Three key AI areas to watch out for in the next 12-18 months.

How a YC founder achieved $2M ARR in one year with a three-person team.

How much cash to expect from your next VC round.

Pitching advice for consumer startups. 

📰 News

Benchmark raises $425M to continue investing in tech startups.

Noplace, a blend of Twitter and Myspace, hits No. 1 on the App Store.

Seed VCs are using new 'pro rata' funds to compete with bigger firms.

OpenAI and Arianna Huffington are collaborating on an 'AI health coach'.

Sidney Scott has closed his VC fund after four years.

💸 Fundraising

AI startup for document search Hebbia raises $130M from a16z.

Fintech Startup Nala raises $40M to scale its remittance services.

Developer platform Tembo raises $14M to continue growth plans. 

YC Risk assessment startup Accend raises $3.2M to continue building out capabilities.

Fail(St)ory

The Indian Twitter

This week, the Indian social media platform Koo announced it is shutting down. The app was a direct competitor of X and was usually referred to as the Indian Twitter.

Why It Matters:

• Creating a new social media platform is extremely challenging. Although Koo ultimately failed, it experienced notable success during its operation.

• Koo’s founder claims they were “just months away” from beating X in India.

• Koo was severely affected by the decline in VC funding since 2021.

What Was Universal Koo: Koo was a social media platform similar to Twitter.

Launched in 2020, it gained popularity in India after Twitter started having conflicts with the Indian government. When the Indian government threatened to shut down Twitter after it refused to block some accounts, Koo positioned itself as a more compliant alternative.

In just a few years, Koo developed a product that its founder claimed had “superior systems and algorithms” compared to Twitter. Unfortunately, they started to run out of funding in 2023 and had to focus on generating revenue and reducing costs. They were forced to lay off 30% of their staff that same year.

The Numbers:

• 📅 Founded in 2020.

• 💰 They secured over $60M in funding.

• 🧑‍💼 They had 260 employees.

• 💻️ At their peak, they had 2.1M active users daily.

• 📈 The like ratio was 7-10x higher than Twitter’s, which made it more attractive for creators.

Reasons For Failure:

• Lack of Funding: Koo's founder claims the main reason for their failure was the decline in funding since 2022. This forced them to pursue revenue before they could scale sufficiently. He says that they would have needed 5 to 6 years of capital to scale the platform and grow the user base before even thinking about revenue. This shows how important it is for this type of startups to find long-term investors.

• Failed to Get a Partnership: Koo was seeking partnerships with larger companies that could fund them and help them grow. However, these attempts were unsuccessful because most of these larger companies “didn't want to deal with user-generated content and the unpredictable nature of a social media company.”

• Too Similar to Twitter: Koo was very similar to Twitter and lacked unique selling points. This made it difficult to convince users to switch from Twitter to Koo. While they achieved some success in India, they struggled in other countries, like Brazil, where only 2,000 users downloaded the app.

Trend

Robotaxis

In recent years, the Robotaxi industry has been growing rapidly.

Last week, the largest US robotaxi company, Waymo, became fully operational in San Francisco, marking an important step in the sector's development.

Why it Matters:

• Major Investments: Big players are investing heavily in the sector. Google owns Waymo, Amazon owns Zoox, and Elon Musk is about to announce his own Robotaxi vehicle.

• Future Ubiquity: In just a few years, Robotaxis could become a common sight in most U.S. cities.

• Market Competition: The Robotaxi industry could become a major competitor to ride-hailing apps like Uber and Lyft.

• Public Concerns: Many people are still worried about AI-driven vehicles on the streets. The success or failure of Waymo in San Francisco could determine the future of the industry.

Waymo: They have now opened its services to all users in San Francisco. This marks their second citywide launch, the first being in Phoenix in 2020. 

This expansion reflects Google's increasing confidence in their autonomous technology and is a vital move towards making self-driving cars a regular part of urban life. It's also a significant step towards potentially transforming what has been a historically unprofitable venture into a financially viable operation in the future.

By operating in a dense and complex urban environment like San Francisco, Waymo aims to demonstrate the robustness and reliability of its technology. The company has been rigorously testing its vehicles to ensure they can handle the city's challenging traffic conditions. Furthermore, the success in San Francisco could pave the way for further expansions into other major cities.

Baidu’s Apollo Go: Another significant player in the Robotaxi industry is Apollo Go, which is owned by China’s internet search leader Baidu. 

Apollo Go represents Baidu's strategic entry into the Robotaxi market. Currently, Baidu is conducting unmanned autonomous driving tests in over five Chinese cities.

The Apollo Go Robotaxi service has gained rapid popularity across China, reflecting growing consumer interest in autonomous transportation solutions.

Recently, Baidu's stock saw a 13% increase following Beijing's announcement of support for Baidu's initiatives in ride-hailing and car rental fleets. This support is expected to contribute to Baidu's path towards profitability, which could be achieved by 2025.

Other Competitors: Another major player in the Robotaxi industry is the Amazon-owned Zoox. Unlike Waymo, which primarily uses modified conventional vehicles, Zoox has designed and built its own vehicles from the ground up. 

These custom-built vehicles are tailored specifically for autonomous driving, offering unique features and optimizations that standard cars cannot match. Zoox's innovative approach aims to revolutionize urban mobility with its purpose-built Robotaxis that promises enhanced safety, efficiency, and passenger comfort.

Meanwhile, Elon has been generating buzz with hints about his upcoming Robotaxi venture. On August 8th, he is set to unveil his new Robotaxi vehicle, which has been eagerly anticipated by both industry experts and the public.

Musk's entry into the Robotaxi market is expected to bring significant innovations and could potentially shake up the industry.

Help Me Improve Failory

That's all of this edition.

Cheers,

Nico