Nathan Armstrong doesn’t mind using the F-word, and believes more Atlantic Canadians should discuss it openly.

The F-word, despite what you may have thought, is “failure”.

Armstrong is rightly proud that he and his brother Greg launched their cleantech startup Hyton Innovations, were shortlisted for an award and took the company through two accelerators. And he’s not ashamed to say that they eventually failed.

It’s a fact of the startup world. Startups are highly risky propositions. They deal with experimental technology, often lack proper working capital and have challenges in finding suitable personnel. They often fail.

“There are still people who view it negatively,” said Armstrong in an interview. “There are always people who are going to say, ‘I knew Hyton wouldn’t progress.’ But we need to find people in the community who can step up after failure.”

The story of the Armstrong brothers is far from an uncommon one. In examining the members of the Atlantic Canadian startup community, we found that 43 startups failed, or died, or however you want to describe their ceasing to be.  In round numbers, it’s about 15 percent of the companies we were following last year. Some had employees and had been going for a few years. Some were operating off little more than the dreams of a few college kids.

Hyton was somewhere in the middle.

Entrevestor first reported on the Armstrong brothers two years ago when they entered their Fredericton-based company – then called CeteX – into the New Brunswick Innovation Foundation’s Breakthru competition.  Its aim was to help companies clean up wastewater from their plants without a massive investment in infrastructure.

CeteX or Hyton proposed fitting all the equipment needed to treat wastewater into a mobile shipping container, backing it into a plant and letting a client lease the system without an expensive upgrade. It would clean the water so that it could be flushed away with no harm to the environment, or re-used in the plant.

The company was one of five finalists in the Breakthru competition. It entered the Accelr8 program at Planet Hatch in Fredericton then, last year, it went through the Launch36 accelerator. It also competed in BioNova’s BioInnovation Challenge.

The Armstrongs lined up early adopters for their system, but they didn’t have the firepower to fully develop the product.

“We had great early adopters,” said Armstrong, now 27. “But we were trying to build a business without a team so product development was a problem. We just didn’t have the cash flow to build it.”

In mid-2014, Greg Armstrong opted to take another position and they decided to wind down the company.

“No one really knows what to do after a company closes,” said Nathan Armstrong. “You wonder what you’re going to do next and not many people want to talk about it. It could be the most pivotal period in an entrepreneur’s life.”

Armstrong found solace in the peers and mentors who he and his brother had relied on in building up Hyton. They included Springboard Atlantic CEO Chris Mathis, Enovex CEO Scott Walton and Xiplinx CEO Brent MacDonald. He also found support from the other founders in his Planet Hatch cohort.

He thought of launching another startup immediately, but soon realized it wasn’t the right time. So he took about two months, during which he conducted a penetrating assessment of himself, his skill set and his wants.

He realized he had an entrepreneurial flair and he did not want to work for a conventional company. He liked innovation. He liked the sales process.

Armstrong began to spend more time with MacDonald. He’d been following Xiplinx, whose Internet of Things application helps food and beverage producers manage their manufacturing processes. Soon he was working for Xiplinx as an account management executive. He works with potential clients through their pilot programs and helps to convert them to paid subscribers.

“I don’t think I could work at a normal company where you’re just a number,” he said. “I feel suffocated where I can’t use my skill set and get into the strategic thinking. Down the road I will probably jump into entrepreneurship again if I get the chance.”

This article first appeared in our first Entrevestor Intelligence report of 2015. 

Disclaimer: Entrevestor receives financial support from government agencies that support startup companies in Atlantic Canada. The sponsoring agencies play no role in determining which companies and individuals are featured in this column, nor do they review columns before they are published.