A New Place For Better Place, As Bankrupt $800M+ Backed Electric Car Startup Sold For $12M
Posted in: Today's Chili
Looks like we have a final chapter for Better Place, the Israel-based electric car tech startup that raised $786 million plus $50 million in debt, only to then file for bankruptcy in May: it has now been acquired by a group called Sunrise, headed by green-technology entrepreneur Yosef Abramowitz and the Association for the Promotion of the Electric Car in Israel.
According to court filings, Sunrise is paying 18 million Israeli shekels ($5 million) for Better Place’s assets in Israel, and another 25 million shekels ($7 million) for its intellectual property, held by Better Place Switzerland. Sunrise was one of two bidders for the company, the other being a consortium including Success Parking Ltd. and U.S. electric car charging company Car Charging Group Inc.
It’s a whimper of an ending for a company that raised hundreds of millions, and many hopes, for its core business: a system that relied on smartgrid technology to create a network of battery swapping stations and other charging points for users of electric cars.
Speeding up battery charging, which typically can take anywhere from between 4 and 12 hours to charge on electric cars, could significantly spur the convenience factor of these vehicles, and help with consumer adoption. Better Place also had other ideas about how, with the rise of electric cars, power usage overall needed to be better managed.
But it seems that even if the vision was big, business was not. Creating a breakthrough technology that relies on industrial-scale overhauls is capital intensive. And there is the question of critical mass for electric car technology: apparently only 950 cars fitted with Better Place’s replaceable battery technology — the core of the business — were sold since 2012 (it looks like the only carmaker to sign on with Better Place was Renault).
Meanwhile, individual car companies like Tesla working on proprietary solutions are a sign that the space is perhaps still too fragmented and nascent for what Better Place had in mind.
Although the downward spiral from bankruptcy to bidding to eventual sale was swift, the writing was on the wall months before, when founder Shai Agassi was removed as CEO in October 2012.
New owners Sunrise are keeping 50 out of Better Place’s 85 remaining employees, and will operate 15 of its charging stations for a period of at least two years. It may not be complete curtains for all of Better Place’s efforts, depending on how Sunrise chooses to use the IP it purchased as well, but it’s not a great day for the wider ambition to move us away from fossil fuel consumption and towards more sustainable progress.
