A HealthTech failure 🔥

Astarte Medical shuts down after having raised $14M.                                                                                                                                                                                                                                                                                                                                                                                                                 [Read Online]( A HealthTech failure 🔥 Astarte Medical shuts down after having raised $14M. [Nicolás Cerdeira]( [fb]( [tw]( [in]( [email](mailto:?subject=Post%20from%20Failory&body=A%20HealthTech%20failure%20%F0%9F%94%A5%3A%20Astarte%20Medical%20shuts%20down%20after%20having%20raised%20%2414M.%0A%0Ahttps%3A%2F%2Fnewsletter.failory.com%2Fp%2Fa-healthtech-failure) Hey — It’s Nico. This is my weekly digest of startup failures, business ideas, and founders’ news. 30k+ founders are receiving today’s email. My goal is to triple this number to 100k by mid of this year. I’m doing it in public on Twitter, so make sure to follow me there if you want to see my progress ;) Today’s edition is brought to you by [Ignite Digital](. Here’s what I got today: - A dive into why Astarte Medical failed 🔥 - An analysis of YC’s “Request for Startups” 💡 - A summary of OpenAI’s new AI, Sora 📰 Presented by Ignite Digital The World is Online. Your Company Should Be Too. Use SEO to reach red-hot buyers before the competition with [Ignite Digital]( 🔥 There are 8.5 billion searches per day on Google. Are you showing up? If not, then you're losing sales. [Ignite Digital]( are the SEO experts with 13 years of experience. They'll design a custom strategy to help you drive website traffic and online sales. Wanna give them a test drive? Request a FREE competitive analysis, and Ignite Digital will respond on the same day with a sneak peek of your competitor's strategy & how you can defeat them. [Get a 100% FREE Competitive Analysis →]( This Week In Startups 🔗 Resources [How Gamma acquired 10M+ users]( in 9 months through WOM (from Failory). Reasons why founders [need to get more active on social media.]( Why startups need to consider [‘AI agents’ as a new distribution channel](. [Carta shares startup dilution stats]( after analyzing 17,000 funding rounds. 📰 News Masayoshi Son is [seeking $100B for an AI chip venture](. [HR unicorn HiBob acquires]( British payroll platform Pento. AI compute startup [Lambda raises $320M and reaches unicorn status](. App development startup [Bending Spoons raises $155M for acquisitions](. 😮 Cool Stuff A list of [new AI agent startups](. Groq is [incredibly fast](. This ugly site [makes $5k/mo](. Fail(St)ory [Astarte Medical] Astarte Medical, a $14M HealthTech Failure In December 2023, Astarte Medical, a pioneering health tech startup, made the difficult decision to shut down after seven years of operation. Despite promising beginnings, including raising $14M in funding, the company faced insurmountable challenges. Earlier this week, Tracy Warren, CEO and co-founder of Astarte Medical did a [fantastic interview]( in which she discussed the rise and fall of her startup. Astarte Medical's Journey: Astarte Medical was founded in 2016 by Tracy Warren, Tammi Jantzen, and Katherine Gregory with the aim of improving care for premature babies. The company developed healthcare software, including its flagship product NICUtrition, designed to monitor and analyze feeding and nutrition delivery to babies in intensive care units (NICUs). Milestones: - In 2019, Astarte secured $5M in Series A funding. - In 2020, they signed their first hospital contract. - In 2021, they raised another $7.6M in funding. Reasons for Failure: - No PMF: Astarte only got contracts with 4 hospitals during its whole existence, which wasn't as many as the investors hoped for. Warren says that hospitals were simply not interested in investing in digital solutions and did not have many incentives to innovate. In the beginning, they were unsure if this lack of interest was due to the pandemic or the market downturn but ultimately realized that there was no product-market fit for what they were building. - The pandemic: Although the pandemic did [increase funding for health startups](, it also [severely decreased the hospital's margins](, making them more interested in surviving the crisis than in investing in new software. - Operational Challenges: Operational challenges, such as integrating with the Electronic Medical Records (EMRs) and navigating the complexity of healthcare data, made delivering and expanding the solution more difficult. Reflections on the HealthTech Industry: - Few incentives to innovate: Hospitals and other healthcare organizations lack significant motivation to invest in new and innovative products. According to Warren, unless hospitals are forced to by external forces (like the pandemic), they “are ok to not jump into new stuff.” Hospitals are not penalized for not innovating, so they usually prefer to avoid change since there is no risk to it. - Devices are easier than software: Hospitals are used to buying medical devices all the time but do not frequently buy new software. This makes the process of selling digital solutions to hospitals a particularly painful experience. - Unexperienced HealthTech investors: During the pandemic, many investors rushed into the HealtTech industry without fully understanding the market dynamics, leading to premature capital dumping. Approaching Shutdown: In her interview, Warren gives some useful advice on how to approach a business shutdown: - Be transparent about the challenges: Avoid surprising your investors and team with ugly news that they had no clue about. Be honest with the challenges the company is facing right from the start and let new hires know about the risks of entering your startup. - Pivoting is not always a good idea: Warren was pushed into pivoting the product to the AI field but decided that this was not a good idea. Using AI in her product could probably have helped in getting another round of funding, but ultimately, she did not see how this would make hospitals more interested in her product. Go Deeper: - Some [more details on Astarte Medical’s failure](. - Check our list of other [11 failed HealthTech startups](. Your Next Startup YC’s Request for Startups Last week, Y Combinator unveiled its latest [Request for Startups](, a comprehensive outline detailing the various startup categories the accelerator intends to support. The list comprises 21 distinct categories encompassing a wide array of industries, ranging from healthcare and cryptocurrency to military applications. Trends: Out of these 21 categories, there are several notable trends emerging that could shape the future of the startup landscape: - AI, AI, and even more AI: Unsurprisingly, the biggest trend by a wide margin is Artificial Intelligence. 6 out of the 21 categories are directly related to AI or Machine Learning. YC is looking for startups that apply AI in different industries like [robotics](, [weather prediction](, and [Enterprise Software](. - Reshaping traditional industries: YC is looking to fund startups that bring new technologies into existing industries. Some of these include the creation of [new defense technology](, using ML-based robotics to [bring manufacturing back to America](, and startups aiming to [eliminate middlemen in healthcare](. - Transforming enterprise software and services: There is a notable trend towards improving enterprise software and services. This includes startups building [new ERP software]( and those building the [“glue code” that integrates]( the different Enterprise applications. Interesting Ideas: Here are some of the categories that I found the most interesting: - [Developer Tools Inspired by Existing Internal Tools](: Internal tools developed by programmers within successful companies are often overlooked as sources of inspiration for startup ideas. These tools, born out of necessity to solve specific problems, have the potential to benefit a broader audience if productized. If it worked for one company, it might work for others. Encouraging the creation of startups based on these homegrown solutions could lead to valuable innovations in the developer tools space. Some successful products that were born as internal tools include React.js (by Facebook), Slack, and Trello. - [Spatial Computing](: Just a few weeks back, I wrote about the [launch of the Vision Pro]( and the huge opportunities the VisionOS ecosystem has. YC seems to agree because they are looking to invest in startups building the software for this new era of computing. With only a couple hundred apps in the marketplace, VisionOS is in dire need of software that can fully harness the capabilities of the Vision Pro device. - [AI to build enterprise software](: AI could revolutionize enterprise software by simplifying the customization process. This could replace lengthy sales cycles with a simple starter product that customers can customize through AI interaction. Instead of having specialized developers customize your ERP or CRM, you could just ask AI for the changes you need. In The News OpenAI Launches Sora, Its Text-to-Video AI In case you’ve been living under a rock and somehow missed OpenAI's latest announcement, here is a quick rundown of the important parts. Last week, Sam Altman announced Sora, [OpenAI’s newest video generation model](. This model is capable of generating realistic-looking videos from text inputs. This is not the first AI model to give video generation a try, but it is undoubtedly the best one. Just for reference, this was the state of AI video generation one year ago, and this is where we’re right now: [tw profile: Trung Phan] Trung Phan @TrungTPhan [tw] Will Smith leaning into AI spaghetti-eating meme and just posted this vid lol Feb 20, 2024 3.49K Likes 227 Retweets 40 Replies Quite a difference, right? It is scary to imagine what this technology will be capable of in one year from now. Refer Failory, Get Rewards Share Failory Chances are you have some more friends who would enjoy Failory as much as you do. Share Failory with these friends and cash in on premium resources and swag. You currently have 0 referrals, only 1 away from receiving the 2024 Startup Failure Report. [Share Failory →]( Or copy and paste this link to others: Help Me Improve Failory How Was Today's Newsletter? If this issue was a startup, how would you rate it? [🚀 Launches to the moon!]( [🤔 Room for a pivot]( [💀 Crashes and burns]( That's all of this edition. Cheers, Nico Update your email preferences or unsubscribe [here]( © 2024 Failory 1309 Coffeen Avenue Ste 1200, Sheridan, Wyoming 82801, United States of America [[beehiiv logo]Powered by beehiiv](