Blazing Trails and Learning from Burnouts: Reflecting on Failure

Written by:
Kathryn de Ridder

To quote the extraordinary New Zealander Sir Edmund Hillary, “It is not the mountain we conquer, but ourselves.”

Our mission at Bridgewest Ventures is driven by the aspiration to create a positive impact on a global scale, offering innovative solutions that truly disrupt the status quo. In a world where urgent solutions are needed to address pressing global issues, such as the looming challenge of feeding 10 Billion people, the worrisome 1.5-degree warming trend, and the rising threat of zoonotic diseases, our determination grows stronger.

As an incubator deeply committed to guiding ventures, we invest not only financial resources but also our hearts and collective efforts. Countless hours are poured into each investment, guided by an active management approach. While we've celebrated triumphs, supporting ventures all the way to global dominance or public listings, it's essential to acknowledge the numerous setbacks and failures that are part of this path.

To not acknowledge the failures does a disservice to the successes and the accomplishments of those founders that overcome these obstacles.

Ventures falter for various reasons; sometimes it is just down to timing, or products not resonating, or a go-to-market strategy weakness. Sometime teams lack synergy, including governance and advisory board failures, but in many cases it is as simple as capital insufficiency. Our strategy centres on uplifting these ventures to success, providing unwavering support. But there comes a point, usually after exhausting every possible avenue to avert insolvency, when we must face the reality in start-up world.

Over the past three years of Bridgewest Ventures operating as a Deep Tech Incubator in New Zealand, we've nurtured 11 companies through incubation. As a Technology Incubator partner of Callaghan Innovation, Bridgewest Ventures companies get access to success-based repayable grant funding that allows innovators to have a go at commercialising their ideas, with limited risk and no repayment required if the proposal doesn't work out. 

We’ve proudly shared the stories of these companies’ successes, as they achieved significant milestones in their products and markets, and hopefully you’ve seen some of these inspiring accounts. Yet, as we sit here today, we haven’t openly discussed the challenges, setbacks, and failures that have also been part of this journey and we think it is positive for us to reflect openly on this aspect.

Unquestionably, this expedition exacts a profound toll on the human spirit. However, it’s a journey that someone must undertake, for without such efforts, meaningful change for the better would remain elusive. It’s a testament to our shared commitment to making a difference, even in the face of adversity, and a hat tip to the tenacity of people like Sir Edmund Hillary.

It's not an easy path, but it's one we must embrace without fear of stumbling. After all, without embracing the possibility of failure, we would never dare to strive for greatness.

Noting the human toll, we find encouragement in the commendable efforts, such as Callaghan Innovation’s Code of Conduct initiative, which provides a structured approach to enhance our interactions between founders and investors and support for those involved. They are also offering counselling support for all start up founders based in New Zealand. Equally praiseworthy is Xero’s Assistance Programme, offering free counselling services to subscribers, employees, and their families. These wellbeing initiatives underscore and recognize the toll this journey can take and we encourage their use.

One of the instances where we faced disappointment in our pursuit of positive global impact was one of our first incubated ventures. This venture took shape in late 2020, and we entered into a joint venture to commercialise a situational awareness tool for first responders. The ideas for this venture stemmed from the efforts of R&D conducted by the digital IP services company, which identified a promising opportunity after working within the Fire and Emergency industry for more than a decade.

Our JV partner had a good track record in successfully spinning out products into ventures, some of which have raised millions in venture capital and have grown impressively. In each case, the spin outs needed to create pathways for employees to becoming founders with company structures to incentivise and recognise the commitment required, which was an important step to make a venture investible.

The new venture we spun out together held a compelling vision: to enhance the outcomes of critical incidents by harnessing intelligence to equip first responders with precise information at the most crucial moments. The unique value proposition was the ability to uncover and present data that had previously been underappreciated by emergency response teams. This newfound intelligence was presented in a manner that was usable, useful, and timely.

The product itself was meticulously crafted in collaboration with working groups comprising first responders. Initially, the focus was on inner city fire departments as the primary target market. Leveraging rich domain expertise and proprietary technology in IoT, AI, 5G, and machine learning, this joint venture held tremendous promise. Yet, despite our intentions and meticulous planning, the journey was fraught with challenges. Rigorous market research highlighted several barriers, including cultural impediments and the decentralised financial decision-making process within the emergency response industry. While the venture team's dedication built and fostered an impressive community, including thousands of global members who joined monthly virtual fireside chats, which is a key to product-led growth, the inability to secure substantial additional funding hindered the conversion of this community into a driving force for sales. Regrettably, trial customers did not convert to paying customers. The solution held potential to resolve numerous sector-specific issues and the list of essential features continued to expand. Adapting the product development strategy to align with the ever-evolving market demands became a delicate dance.

Inevitably, financial constraints reached a point where the project could no longer sustain itself. This situation led us to question; was it a matter of timing, product readiness, team dynamics, or insufficient capital? The answer eludes us, obscured by the complexity of the many variables at play.

Our journey with this joint venture ultimately came to an end and we were left pondering the uncertainty that comes with these endeavours, and when you decide to step away….? The truth is, we may never definitively pinpoint what caused the outcome, but we know that the team gave it their all.

Despite the challenges, we've chosen to forge ahead, carrying the lessons learned as we continue to explore new opportunities, and we are confident that the platform and learnings created could form the base camp for another explorer.

In our pursuit of a Unicorn (or, several Unicorns), we embark on a journey filled with significant risk, and challenges that test our resolve. It is the way of all early venture and technology investing. It's not an easy path, but it's one we must embrace without the fear of stumbling. After all, without embracing the possibility of failure, we would never dare to strive for greatness.