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Summary:

Fisker is raising even more money — another $150 million — on top of the $1 billion it’s already raised. How long will private investors be willing to keep funding the electric car maker?

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How long will private investors, who have already put in hundreds of millions of dollars into electric car maker Fisker Automotive, be willing to fund the struggling auto maker startup? According to reports by Dow Jones Venture Wire, and Reuters, which cite Kleiner Perkins partner Ray Lane, Fisker is seeking another $150 million — on top of the $1 billion it’s already raised — from private equity investors.

Brokerage firm Advanced Equities, whose co-founder and CEO Dwight Badger stepped down recently, is leading the terms of the deal, reports VentureWire. Advanced Equities has also raised money for fuel cell maker Bloom Energy and more recently solar company SolFocus. Advanced Equities is also being investigated for fundraising connected to a private offering.

I put this Fisker fund raising out there as a rumor on Tuesday, and I heard that the fundraising was at a significant down round. The big question is: how long will a group of private investors be willing to continue to fund the company? Especially if Fisker struggles more over the coming months — the company just completely overhauled its management team and brought in another CEO and there were reports of a Karma catching on fire last weekend.

VentureWire reports that Fisker attempted to raise debt from private lenders but that failed because the terms were too onerous. Fisker needs this funding to develop the next car, and to eventually breakeven, reports Reuters. If Fisker can raise this money, and survive, Lane tells both VentureWire and Reuters that if the market feels right Fisker could attempt an IPO in 2013. Sounds like he’s trying to entice new investors into this round with that IPO media shout out.

Will disgruntled Fisker investors start coming out of the wood work? If anyone wants to chat, you know where you can reach me.

  1. Katie, I have been following your articles on Fisker, as I am a Fisker driver. I feel you are very negative about Fisker and do not believe in anything they do, and usually write suspiciously about them. I am curios to know why you are so negative about them?

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    1. I don’t think the issue is with the car (although there have been well publicised faults), I think the “suspicion” mainly surrounds the running of the company.

      It was never going to be easy to set up and launch a car company from scratch, but when $1bn has been pumped in, with another $150m ready to be guzzled, you have to think of what’s really in it for the current list of investors.

      I can’t see the company breaking even next year, so why not cut their losses and sell to a strategic investor now?

      FYI – I think the car is beautiful, and the fact it’s a plug-in hybrid rather than an all-electric is a massive bonus for those who like to drive without boundaries.

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  2. Keith do you think the fact that Katie’s husband works for Tesla makes her view a bit biased. All her stories on Tesla are very positive (I have been a Tesla driver too). All her stories on Fisker are speculative and negative. She is very conflicted in doing this. Don’t you think so?

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    1. I’m not married buddy. But thanks for completing making that up. I like how you call it a fact though.

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      1. I think if you look at the professional reviews so far for Tesla model S vs karma, it seems like all the reviewers are biased toward the Model S. Maybe it is indeed better?
        Disclaimer: I have not driven both of the cars.

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      2. Katie my point is not if you are married or not, whether you have a conflict or not.

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  3. I wonder if their stock certificates will be less prone to spontaneously combust than their cars.

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  4. Just look at the overwhelming positive reviews for Tesla…you cant say all of them are biased! I dont know why Karma is being compared to model s because technically it is a hybrid.

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    1. Solardentist that is compare virtual world to reality. Tesla model S has not proven itself yet. I had to get rid of my Tesla when i had problems with range and also the company stopped production.

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  5. @Nic I have no conflict. What I write in my articles is my opinion after watching both companies every day for the past 5 years — since 2007. That’s when Fisker first emerged and about fours years into tesla’s lifespan. Also, you can’t change your comment. You said it was a fact that I was married to a tesla exec, which isnt true. Ive never dated a tesla exec or married a tesla exec.

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  6. Hi Katie. Your comment: “the company just completely overhauled its management team and brought in another CEO and there were reports of a Karma catching on fire last weekend.” is not quite true. I have grown to appreciate your articles, but it sounds like you are biased, and I do not blame the other folks for making those comments. I would expect you of all people to actually do your research and understand first of all, why the CEO change, and maybe make some comments about the new CEO. Second, they did not completely overhaul their management team, if anything, there have been nothing but additions to the management team, which makes them stronger then ever. Maybe you could write an article strictly on the management team, that would be some homework for you. I am a little disappointed in you, but it is what it is…

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    1. Here’s the entire article I wrote on the new CEO and also has the other new management changes in it: http://gigaom.com/cleantech/fisker-switches-up-its-ceo-again/

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  7. It’s a matter of choosing your words appropriately. “overhauled” means that people were replaced, and some were fired. Do you know anyone that was fired? I may be wrong here, but their strengthening of the management team has been something that Fisker worked on diligently to actually satisfy some of the DOE requirements. I know you know this, but it was never mentioned here. I get the feeling that your words are chosen specifically to send a negative spin on the current status. Nowhere on both articles did you mention that the new CEO came from the Chevy volt, and that he was responsible for bringing it to the market, and made a successful launch. I am just saying…
    I still do appreciate you, as I read your articles on all other cleantech companies.

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  8. I follow Fisker very closely and think Katie’s articles have been totally fair. The fact that the company is having trouble executing is not her fault. As a Fisker investor, I really appreciate her informed, unbiased writings.

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  9. I really doubt you are a Fisker Investor. I also doubt you follow Fisker. I can not help but laugh at your statement Tom.

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    1. Not sure why you would doubt this. Maybe you should listen in our next conference call. Have a nice weekend brother.

      CONFERENCE INFORMATION

      Conference Title: Fisker New Investor Call

      Moderator Name: Peter McDonnell

      Company Executives: Henrik Fisker, Tony Pasowatz and Jim Yost

      Conference Date: Monday, September 10, 2012

      Conference Time: 1:00pm CT

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