The #1 Rule For Startup Success

February 02, 2023

GM! It's Thursday, February 1st - Today, we're covering Bugatti breaking records, ChatGPT growing faster than TikTok, the Instagram co-founders new startup, Stripe raising $2.5B, and Jack Abrahams's number 1 rule for startup success.

- Callum

FEATURE

He's Launched 33 Businesses, And All Must Pass This Test.

At 24, Jack Abraham sold his company to eBay for $75m. Since then, he's launched 33 businesses that have earned billions.

What's His Business?

Jack is the founder of Atomic VC, a venture fund that creates its own companies. It has an incredible track record, so much so that investors have given Atomic over $430m to keep building its own companies.

Notable companies include:

  • Openstore (Raised $137m) - eCom store acquisition.

  • Hims & Hers (NYSE: HIMS, Market Cap: $1.66B) - Wellness brand.

  • Bungalow (Raised $171m) - Home rental service.

Jack creates multiple businesses at once and does so systematically. To make this possible, he’s developed a very powerful system to test his ideas.

Jack's #1 Rule For Startups

The best method to build high-growth, sustainable businesses is to solve distribution first.

Startups often get stuck at the 'distribution wall' it goes like this:

  • Founder has an idea

  • Raise money from friends and family to build the product

  • And 2 years later, it has a product ready to sell

But they forgot to plan how to sell the product during that time. 9 out of 10 startups fail because they hit this distribution wall. So Jack launched Atomic, a venture studio that creates breakout companies.

He flips the process on its head and says:

"If we can't get through the wall, we won't start the company...we don't care if it's a good idea in the abstract, if it can't get through that wall, it will fail. This is the secret to our success."

Jack Abraham

Here's the Atomic Process:

1) Identify a big problem with lots of potential customers.

2) Understand the channels to reach those customers (Paid ads, Partnerships, Inside Sales...)

3) Test the profitability and scalability of these channels.

4) Only build if it passes #3.

HEADLINES

Last Gas-Powered Bugatti Sold For $10.7M

> Bugatti sold its last gas-powered car for $10.7m, setting world auction records.

> ChatGPT is growing faster than TikTok. In its first month of release, it eclipsed 50m monthly active users and surpassed 100m by the end of January.

> Bed Bath & Beyond misses more than $28m in interest payments on bonds.

> Peloton is starting to show signs of recovery.

> Rivian is laying off another 6% of its workforce. The automaker claims manufacturing roles won't be affected as it aims for profitability.

> Stripe in talks to raise $2.5B after lowering valuation, which would raise its valuation from $55B to $60B.

> Facebook's stock price surged 18% on plans to devote 80% of its total investment dollars to its legacy business.

> Tiger Global cuts fundraising target as the startup market cools, shrinking its initial $6B fund target to $5B.

> Tom Brady announces his retirement from the NFL...again?

> The Unicorn club: Zopa, the UK neobank, raises $93m at a $1b+ valuation.

ON TREND

The Instagram Co-Founders New Startup

You should know:

  • Kevin Systrom and Mike Krieger sold Instagram to Facebook for $1B in 2012. Now, they're launching their new business - Artifact.

  • Artifact is a personalized news feed drive by the lates in AI.

  • The team was inspired by TikTok's innovation, which proved that people would ingest content driven by a personalized algorithm, not just who their friends are.

  • Join the waitlist here.