Nectocaris is another weird Cambrian-era animal, initially thought to have been even weirder thanks to the poorly preserved nature of the type specimen. It was originally reconstructed as a worm-like animal with a crustacean-like head, thought to possess features of both arthropods and early vertebrates. However, once better-preserved fossils were discovered, Nectocaris was revealed to be a much more cephalopod-like animal.
Nectocaris has a lot of traits that are retained in modern cephalopods, including a cuttlefish-like fin and a primitive “funnel” that may have played a role in jet propulsion. These pieces of evidence, coupled with its obvious physical resemblance to squids and cuttlefish, has led some paleontologists to believe that Nectocaris was ancestral to modern cephalopods. However, there’s one big problem with this theory.
Every other ancestral cephalopod from the Cambrian period possesses a hard shell. One such example is Plectronoceras, an ancestor to both cephalopods and gastropods (slugs and snails), as well as one of the most positively darling little animals to ever live on the sea floor. Look at him! He looks like a little wizard!
…Anyway. All cephalopods had external shells of some sort, until the development of modern-looking shell-less octopi in the Late Carboniferous period. In fact, there are shelled cephalopod-like animals that predate Nectocaris in the fossil record. If Nectocaris was truly ancestral to cephalopods, that would mean that cephalopods universally lost their shells, then universally gained them again. Personally, I find that unlikely.
My personal theory is that Nectocaris represents a sister group of that which would give rise to modern cephalopods. It convergently evolved to resemble a more modern, shell-less squid, but did not give rise to them, and likely has no living direct descendants.