A turbulent year has ended in the worst possible way for electric car group Better Place after it appointed liquidators on Sunday.
The battery-charging and battery-switching service provider raised close to a billion dollars from investors during its six-year lifespan but collapsed as it became clear it was about a decade too early with its idea.
The writing was on the wall back in October when charismatic founder Shai Agassi made the shock move to step aside as chief executive, with the Israeli-based group’s Australian chief Evan Thornley taking the reins. His charge to the top ended almost as surprisingly as it began, when he was fired in January after a dispute on strategy with the board. That dispute ultimately resolved itself with the re-focusing on its two original markets of Denmark and Israel.
In between times the company sacked a large portion of its staff and managed to raise a further $100 million in emergency funding from increasingly restless investors. That restlessness eventually turned to indifference however, with the company unable to find funding to shore up its leaky balance sheet. By the end it had raised around $850 million with little to show for it.
As Tristan Edis wrote in Climate Spectator in January, the vision was there but the business plan was lacking detail.
Firstly, it was reliant on a speed of electric car growth that was incredibly optimistic. Secondly, Renault aside, it failed to capture the imagination of vehicle manufacturers, which were sceptical about providing the details of a critical component of their vehicles to a Better Place standards committee. This was crucial so the group could offer battery replacement services and essentially slash the time of a full ‘recharge’ from hours to minutes.
Lastly, it never really had a significant competitive advantage and even if it had proved successful in the short-term, copycats would have been ready to swoop.
Led by Agassi, described in 2009 as “amazingly persuasive” by Israel President Shimon Peres, the firm provided an image of the future that won over investors and compelled the media to pay attention. But the vision was never matched with discussion of how and when it would become profitable. Indeed, it never happened and the company has known for some time that the challenge could prove beyond them.
“Unfortunately, after a year’s commercial operation, it was clear to us that despite many satisfied customers, the wider public take-up would not be sufficient and that the support from the car producers was not forthcoming,” current chief executive, Dan Cohen, revealed on the weekend.
It was a sober admission from a once fearless up-and-coming company.
Nevertheless, Better Place still stands by its core concept and sees it eventually succeeding, just not under its name.
“We stand by the original vision as formulated by Shai Agassi of creating a green alternative that would lessen our dependence on highly polluting transportation technologies,” the board of directors declared.
“The vision is still valid and important and we remain hopeful that eventually the vision will be realised for the benefit of a better world. However, Better Place will not be able to take part in the realisation of this vision.”
They may be right, just don’t expect to see it this decade.