Better place 311.
(photo credit: Better place)
Once the very symbol of Israeli green innovation, the Better Place electric car
company filed for bankruptcy on Sunday, asking the Lod District Court to
“Despite significant efforts,” the firm announced, “revenues
are still insufficient to cover operating costs, and in the light of the
continued negative cash flow position, the board has decided that it has no
option but to seek to make this application to the courts for an orderly
liquidation of the company.”
“This is a difficult day for all of us,”
Better Place CEO Dan Cohen said.
Despite its innovative vision and
accomplishments, he said, the latest, unsuccessful round of fund-raising left
the company financially unviable.
“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,” Cohen said.
The announcement spells
uncertainty for Better Place car owners, who bet on the company’s continued
operation to provide electric infrastructure for their cars. Without battery
switch stations, the cars will be limited to about 120 km. before needing to be
It will be up to the courts and the liquidation team to
determine how to compensate them, a task complicated by the fact that some
purchased four years of kilometers for their car batteries ahead of time, while
others bought them on a pay-as-you-go basis; some purchased their cars, others
had them on lease.
Founded by former SAP executive Shai Agassi in 2007,
Better Place captured global attention with its vision for making electric cars
viable by building a battery-swapping infrastructure to rival standard gas
stations. It had plans to launch in Australia, Japan, China, Europe and the
With Agassi’s inspirational vision touted on TED (Technology,
Entertainment, Design) talks internationally and a vaunted place in Start- Up
Nation, the much-touted tome on Israeli innovation, the company won accolades
from the likes of the World Economic Forum and raised some $850 million over the
In 2008 it contracted Renault to produce a Better Place car, the
Renault Fluence ZE, in hopes that others would also eventually begin producing
cars to match its stations.
Yet when the car came onto the market in
Israel and Denmark, where the company had invested millions in infrastructure,
the public was slow to buy. To date, it has sold only some 900 in Israel, and
400 in Denmark.
Amid slow progress, management disagreements and a
growing concern over the company’s financial situation, the board ousted its
visionary founder, Shai Agassi, in October, replacing him with Evan Thornley,
the CEO of Better Place Australia. Thornley himself stepped down in January, to
be replaced by Cohen, and the company soon discontinued its global activities to
focus on success at home.
When Better Place withdrew funding from its
Australia operation in February, it had some 150 battery charge sites in
Melbourne, Sydney, Canberra and the Hunter Valley.
Despite a handful of
hopeful signs in Israel, such as a leasing program that boosted sales, and
agreements to furnish fleets of cars to government bodies, the company failed to
get a footing in the car market. On Sunday, its controlling shareholders at
Israel Corporation decided that they would no longer invest in the
“The technical challenges we overcame successfully, but the
other obstacles we were not able to overcome, despite the massive effort and
resources that were deployed to that end,” the board of directors said in a
“The vision is still valid and important and we remain hopeful
that eventually the vision will be realized for the benefit of a better world.
However, Better Place will not be able to take part in the realization of this