Extra-embryonic endoderm stem (XEN) cells can be derived from the mouse primitive endoderm, which gives rise to two extra-embryonic tissues: the visceral endoderm (VE) and the parietal endoderm. However, despite displaying many characteristics of primitive endoderm, XEN cells only contribute effectively to parietal endoderm in mouse chimeras. Here, Michael Shen and co-workers study the differentiation of XEN cells in response to Nodal, a member of the TGFβ superfamily, and Cripto, a Nodal co-receptor (p. 3885). Importantly, the researchers show that XEN cells treated with either Nodal or Cripto display an up-regulation of VE markers and contribute to VE in chimeric embryos. Notably, they report, the response of XEN cells to Nodal and Cripto differs: the response to Nodal is blocked by treatment with an Alk4/Alk5/Alk7 kinase inhibitor, whereas the response to Cripto is unaffected, suggesting that Cripto can act independently of these receptors' activity. These findings provide key insights into visceral endoderm specification and define distinct pathways for Nodal and Cripto during cell differentiation.