Anatomy of the Bridj collapse: Startup moved too fast
I rode a bus operated by the Boston startup Bridj on its very first day of operations in June 2014, and again on the company’s last day, on April 28.
Both times, it was an excellent experience. The bus showed up when it was supposed to. I was guaranteed a seat, and there was Wi-Fi on board. Best of all, there were zero stops along my route from Coolidge Corner to Cambridge. I didn’t use Bridj every day, but the price — about $4.75 — felt fair on days when I had a morning meeting and wanted to avoid T transfers.
But every time I described it as an app-enabled bus service — you used a smartphone app to peruse the schedule and then book a ticket — I would field a missive from the founder, Matthew George.
The company’s “very public mission statement is to build autonomous infrastructure for cities,” George wrote in a March e-mail. “It is inaccurate to say that Bridj as a company is built around a commuter service; it’s simply one of the six products that we’ll eventually release.” One idea hyped in this newspaper last year — but never launched — involved using cargo robots to deliver groceries and convenience items to homes. George also described Bridj to me as “an autonomous air traffic control network for cities” that would use software to understand where people wanted to travel, or what goods they wanted delivered, and would dispatch vehicles or robots to satisfy those needs.
Having a vision of how the future will unfold is important for a fledgling company that hopes to play a part in that future. But there’s also something strange happening in 2017. Before founders have even finished writing Act One of their plays, they want to leap onstage and start performing in Act Two.
They might be inspired by the entrepreneurs at companies like Google, Amazon, and Netflix, which started in one business but have since branched into others. Google, famously, has been developing self-driving cars, as well as high-altitude balloons to blanket remote areas with Internet access. In addition to selling you a suitcase, Amazon will also rent you server space. Instead of just delivering movies and TV shows made by others, Netflix produces its own binge-worthy original content. But each of them earned the right to branch out by first figuring out how to make the core business work. Netflix, for instance, had about 35 million subscribers and $3.6 billion in revenue in 2012, the year before it began launching original shows like “House of Cards.”
There’s a tension, though, that entrepreneurs feel: You need to sell a big vision to get investors excited, but trying to deliver on that vision can pull you away from making today’s business really hum. “It’s great to have a roadmap to the future, but you need a game plan for the current game that you’re playing, and that needs to consume 95 percent of your resources,” says Eric Paley, a partner at Cambridge-based venture capital firm Founder Collective. (Paley, like others with whom I spoke, wanted to be clear that he was speaking generally, rather than about Bridj specifically.)
But Paley acknowledges that investors at times deserve some of the blame when they “push founders by saying that the market [they’re focusing on] is too small, and the opportunity not big enough. I think we should be disciplined enough to both see the big picture, and to accept that the company will start off in a very focused manner.”
Joe Caruso, one of Boston’s most active “angel” investors, says he tried to invest in Bridj, but George wanted him to write a larger check than he was comfortable with. Reflecting on Amazon’s success, Caruso says, “I doubt Jeff Bezos said, ‘I want an online bookstore,’ but had he tried to be everything at once, I doubt he would have succeeded. He began with books — and nailed it.”
Boston venture capitalist Todd Dagres puts it this way: “I’ve often said to entrepreneurs and colleagues that you have to do one thing better than anyone else to be successful.” Dagres’s firm has invested in companies like Twitter, virtual reality headset maker Oculus, and Slack, a collaboration tool. “If you’re lucky, that one thing will deliver value to a large group of users,” he says.
Even after George announced at the end of April that Bridj would cease operations, he still disagreed with my narrow view of his company as a provider of a local transportation service that I’d enjoyed using. In an e-mail, George said 95 percent of Bridj’s resources had been dedicated to the long-term vision of “developing technology to automate urban logistics for people and freight.” He added: “We had no marketing staff, just machine learning folks and software engineers.”
From George’s perspective, running a fleet of buses around Boston (and also, at various points, Kansas City and Washington, D.C.) was simply a demonstration of the sophisticated software Bridj was building, not its core “Act One” business.
Meanwhile, even though many Bostonians saw the sleek black Bridj buses cruising around town, whenever I asked people if they’d ridden Bridj, the answer was, “not yet.” The process of downloading the app, setting up an account, figuring out whether the schedule and pick-up locations were useful, and then buying your first ticket was a good bit more involved than signing up to use a service like Uber or Lyft.
In March, George told me that the company had chalked up a profitable fourth quarter for 2016. But less than two months later, the company said it was shutting down, after a big partnership/funding deal with a major carmaker, reportedly Toyota, fell apart. (Bridj raised about $11 million in funding over the course of its life, George said.)
My experience as a Bridj customer has an odd postscript to it. In researching this column, I went to check how many times I’d ridden Bridj this year. I couldn’t find out from the app, which no longer works. I couldn’t find any charges from Bridj on my credit card statements. Had the company been comping me without my knowledge? George said it had not. For some unknown reason, Bridj just hadn’t charged me for the half-dozen or so rides I took in 2017.
George said he’d look into why that was. “You may owe us some money,” he joked.