Only the companies in an investor’s portfolio that they truly believe in get a bridge - otherwise it’s a bridge to nowhere.

IMO bridge rounds aren’t driven by the investor’s fear of a markdown - they’re driven by the belief that the founder+team can figure it out and get to the next stage. When risking even more cash on a company that isn’t an obvious winner, you really have to believe in the team.

Not necessarily, a VC needs to show it's doing good business to raise money from investors, hiding your losses helps with that, in the short term.

Early investors are in the same boat as founders: a down round would hurt them just as much.

So a bridge round isn't about "throwing good money after bad", it's about VCs still believing in the business and not wanting to have to sell another part of the company on the cheap.