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.