An agtech start-up offered salad kits filled with fresh ingredients grown using advanced robotics. With the backing of tens of millions of VCs and the recent launch of a new salad product in eco-friendly packaging, the company founded in 2015 is on track for his next year of growth. It looked like
However, employees report that Pittsburgh Business Timesending its fifth season as of this past Friday.
The company also has a farm facility in Braddock where it grows produce and employs about 100 people.
“Unfortunately, sometimes the timing is wrong and the economic downturn affects businesses differently,” wrote a former software engineer on LinkedIn last week. “The Fifth Season ends today and I am heartbroken at the loss of my potential, but I am looking forward to the next chapter.”
The Fifth Season did not respond technical.ly Request for comments.
Why startup fails
this is, Algo AI A shutdown that shocked the Pittsburgh area. The products made by Fifth Season and self-driving car tech company Argo AI are worlds apart, but those who Technical.ly spoke to about the chain of events agree that the shutdown is only a harsh reminder of reality: Startups often fail.
“Failure is far more common than success” Sean Sebastian,partner Black Tech Nation Ventures When Birchmere Ventures, told Technical.ly. “As you know, successes are celebrated, celebrated, featured on blog covers, etc. With a few notable exceptions, failures usually quietly fade away.”
The trade-off with the potential for high returns on investment is a huge chance things can go wrong. So why do startups with millions of VC dollars behind them fail? Usually the answer is money.
“At that level, it’s kind of very simple and obvious: the money runs out, the lights go out,” Sebastian said. “The question is, ‘Why did they run out of money?’ They either can’t achieve profitability or they can’t scale to buy with the capital they have.”
In other words, the problem is that even though the startup has achieved its original goals and produced a product, the market has shifted to products made by “more well-financed” competitors. Investors say there is potential. In either case, the end result could be that the store has to close due to costs.
“This is a very high risk, very high reward business,” Sebastian said.
Olga Pogodanow chief operating officer of a Larimar-based drone software maker KEF Robotics, tend to agree. Having spent several years in the startup world, she said she hoped more people in the tech space would be more than happy to share their failures because it was very unlikely they would succeed. It can be helpful for future founders to understand when something has happened or when everyone involved tried their best and it didn’t work out.
Project Olympus, Carnegie Mellon University, said she always encourages people to understand their market. Because, broadly speaking, in addition to lack of funding, sometimes the problem with startups is that there is no market for their product.
“Sometimes the problem they’re trying to solve isn’t so bad that people want to spend money on it,” says Pogoda.
For Fifth Season, Pogoda sympathizes with everyone involved, but doesn’t think the shutdown is a bad sign for the Pittsburgh startup as a whole. But it’s a reminder that we’re in the middle of an economic recession, not just for the city, but for the country as a whole.
“This and Argo AI are very unfortunate events,” said Pogoda. “But I don’t think they’re really speaking to the Pittsburgh ecosystem. There are a lot of thriving startups and small businesses.”
As Pittsburgh’s leader in the industry, bloomfield robotics CEOMark DeSantis share her feelings. He said running an agtech startup can be difficult. DeSantis described this subset of the tech industry as “unforgiving” at times. Personally he hasn’t interacted much with the Fifth season, but he thinks they should be applauded for their efforts.
“I think they put in a lot of effort,” said DeSantis. “In vertical farming, it’s a challenging market. In an industry with some very large players making hundreds of millions of dollars to get to a certain minimum scale, it can be difficult for companies to scale that scale. cannot be reached.”
The reasons behind Fifth Season’s closure are still unclear, but Desantis noted that, like others, startups often fail and the economy is still in a precarious place.
From start to finish, building and maintaining a company is no easy task. Whatever the case with Fifth Season, he doesn’t see the news as a sign of doom for the agritech industry.
“I don’t treat this as any kind of agtech trend, it’s just a real challenge to try to do something really hard,” said Desantis.
Atiya Irvin-Mitchell is a 2022-2023 squad member for Report for America. This is an initiative of The Groundtruth Project that pairs young journalists with local newsrooms. This position is supported by Heinz Endowments. -30-