Soul Machines

What worked

Turned genuinely world-class research — Mark Sagar's double Academy Award-winning facial animation and the BabyX virtual-infant project — into the defining company of the digital-human category.
Raised more than US$135 million (~NZ$225 million) across six rounds from Horizons Ventures, Temasek, Salesforce Ventures, Lakestar, and SoftBank Vision Fund 2 — New Zealand's flagship AI startup of its era.
Deployed real enterprise digital humans years before generative AI made avatars mainstream, with pilots and deployments at Air New Zealand, ANZ, Mercedes-Benz, and other global brands.
Built the Digital Brain — an autonomous animation system simulating a nervous system for real-time emotional expression — a technical approach no competitor seriously replicated.
Scaled to 253 employees at peak (July 2023) with operations spanning New Zealand, the US, and the UK.
Shipped Soul Machines Studio, moving from bespoke services toward self-serve creation of LLM-connected digital people before the money ran out.

What broke

Revenue never materialized at venture scale — no revenue figures were ever publicly disclosed across a decade and US$135 million of funding.
Marquee enterprise customers Mercedes-Benz, ANZ, and Air New Zealand all churned, hollowing out the reference base that justified the premium positioning.
Generative AI commoditized avatars: Synthesia, HeyGen, D-ID and others delivered good-enough digital humans at a fraction of the cost, erasing the Digital Brain's differentiation in buyers' eyes.
Burn was catastrophic relative to traction — US$38.1 million in annual net outflows against US$12.3 million cash by March 2023.
Bespoke, services-heavy deployments never converted into a scalable product business, leaving the company dependent on continual fundraising.
Leadership dissolved as the crisis deepened: CEO Greg Cross resigned September 2023, co-founder Mark Sagar stepped down June 2024, and headcount fell 82% from peak before receivers were appointed on February 5, 2026 owing creditors over NZ$19.5 million.