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Israeli electric car company Better Place, which raised about $800 million on a vision to revolutionize the auto industry, filed for bankruptcy liquidation Sunday, citing disappointing sales and exhausted cash reserves.
The spectacular rise and fall of the company is a blow to Israel’s image as a “startup nation,” in which hundreds of innovative new technology businesses have attracted billions of dollars in investment capital from around the world.
Despite bold sales predictions, positive press and a futuristic showroom near Tel Aviv, only a few hundred Israelis purchased the Renault cars, whose batteries were to be recharged or swapped as needed at a network of company-run charging stations.
“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,” Better Place chief executive Dan Cohen said in a written statement.
Sluggish sales led to a management shake-up last year when founder Shai Agassi was replaced as chief executive. This year, Renault announced that it would slow production. Attempts to raise more capital failed.
During its heyday, Better Place, founded in 2008, lured hundreds of millions of dollars from large investors, including Morgan Stanley.