Better Place Looks To Raise $100 Million To Fund Operations

5 years ago by Inside EVs Staff 7

Better Place Battery Swapping Station In Isreal

Better Place is a US-Israeli operation that features (in collaboration with Renault) an elaborate battery swap and recharge system for EV owners.  At the moment those swap station are available mostly in Israel (about 40 stations) and Denmark (about 20 stations), with an inaugural test station just opened in the Netherlands.

The problem for Better Place after raising almost a billion dollars, is that the company in 2009 committed to buy 100,000 swappable battery EVs from Renault by 2016, and at the halfway point of that timeline today they are still about 100,000 shy, give or take 500.  Breakeven/profitability was estimated to come at around 20,000 EVs on the roads.

Shai Agassi, Removed As CEO Of Better Place Last Month

Now, Better Place seeks to raise another $100 million to fund operations.

This effort is lead by Israel Corp., which said in a statement that it intends to eventually contribute up to $67 million itself in two tranches over a period of up to one year.  As part of the deal, Better Place has the right to find “other” investors, in which case the amount Israel Corp. invests (and how much it owns of Better Place) could be less.  The company currently owns 30% of the electric vehicle swap station builder.

In a regulatory filing, Israel Corp said it had “received a review of the challenges and dangers Better Place faces as a growth company that is in the process of growth and development, which have led to some time delays and an increase in costs, factors that are typical of companies at this stage…And that this investment round is intended to allow Better Place to continue to develop and realize its plans as it prepares for the next stage of the company of commercial operations and meeting customer needs/tastes”

From the outside, what it seems like is that Israel Corp is unwilling to let the (estimated) $250 million it has already invested in Better Place swirl the drain, and is hoping this latest investment can provide Better Place with enough time to finally figure out how to make their business model work.

Better Place lost $132 million in the first half of 2012, and about $500 million since its inception.  Last month the board of directors removed founder Shai Agassi, from his duties as CEO of the company.

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7 responses to "Better Place Looks To Raise $100 Million To Fund Operations"

  1. Schmeltz says:

    What is the main problem with Better Place taking off? Why aren’t people signing on to their plan? Is it because the plans are too costly or not enough EV’s to choose from? I thought at least in Isreal that they were pretty much set up and ready to take orders. And you would think a place like Isreal would be the perfect environment for a system like Better Place. If they can’t make it work there, that is telling as to how it would fly in other places too.

  2. Herm says:

    Jason, are these Israel or Netherlands prices you are using?

    I think the problem is the same as all electrics and plug-ins are suffering from, slow uptake due mostly to customer inertia. Its important to the national security of Israel for PBP to take off.

    The first thing we all think off is the battery swap stations, but most of these cars will be recharged in a conventional manner in a conventional place.

    1. Jay Cole says:

      Do they actaully have service in Netherlands, I thought it was just a test/prototype station?

      Anyway, they just changed to those prices about 4 months ago because they only had a couple hundred subscribers. The old deal (I believe) was you ended up paying at least $275 to $400 a month on pay as you go, or pre-pay for 80,000km over 4 years.

      Looks like they signed up 300 or so people in those 4 months with the lower pricing, that increase is probably how they are selling this new round of financing; as an uptick in subscribers, but I would think the “needing 20,000” to breakeven is a lot higher now.

  3. MrEnergyCzar says:

    Why create a new infrastructure…. outlets are everywhere already or it’s cheaper to install them than build these battery stations with limited choices of cars….

    MrEnergyCzar

    1. Mark H says:

      I believe quick charging along with new battery technology will end this. If you can charge 80% in the same time it takes to swap it will be a tough sell at their current pricing Time will tell. Of course I live like you from 110 outlet to outlet, so definitively a different mind set for PHEV drivers.

    2. Herm says:

      because people are not ready to accept the limitations of a car with 70 miles of range.. thus all this worry about infrastructure, fast chargers, slow chargers, range extenders, battery swap etc.. mostly the infrastructure is to make the driver feel better, it will seldom be used.

      That feeling of security could also be achieved by installing lots of faux inflatable fast chargers all over the place 🙂

  4. Shawn marshall says:

    let’s find somebody to throw good money after bad.