The Globes piece estimated that Better Place would need another four years and $500 million to reach break even. Better Place just raised $100 million back in November 2012, with much of it coming from Israel Corporation. Before that deal, Israel Corp owned about a third of the company and held a $160 million loss.

If Better Place files for bankruptcy, it will be a sober end for a startup that was founded by the charismatic Shai Agassi in an attempt to get the world’s drivers off of gas-powered cars. Better Place’s business model was built around an electric car with a swappable battery, and the installation of both battery swap stations and battery chargers around a designated area. Customers pay for the electricity to charge the car via a subscription service (like cell phone minutes) and the electric cars themselves were supposed to be highly subsidized.

However, the plan took more money and more time than originally expected. The company aimed too broadly, and when it finally decided to highlight its flagship roll out in Israel, sales to Israeli customers were slow going. Better Place ousted its founder and CEO Agassi late last year, and shortly after that Agassi left the company. The company’s following CEO also left after three months.

Along with Israel Corp, Better Place has raised money from GE, UBS, VantagePoint Venture Partners, Lazard Asset Management, Morgan Stanley, Agassi himself, and others. Agassi told me in February of this year that he still believed in the business model of swappable batteries and subscriptions for electrons.

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Late last year there was the ouster of Better Place founder and former CEO Shai Agassi as Better Place struggled to sell cars in Israel, saddled with losses. And no one can forget the posterchild of failing big — Solyndra — as the company’s name was drilled into American minds through the presidential campaign last year after going bankrupt in 2011, and taking taxpayer dollars down with it.

Solyndra’s Factory

As I’ve been thinking about these types of companies — ones that take a lot of investor money and a lot of media attention and for whatever reason flame out on an international stage — I’ve been trying to think about what characteristics these high profile failures have in common. There was a book written a few years on the habits of unsuccessful executives, which is telling. But these “big failure” stories aren’t just about not succeeding, they’re also about failing under a bright media spotlight; often times going from beloved to beleaguered at a rapid clip, and along the way over-promising across many levels and often times losing a lot of people’s money.

To note, Better Place and Fisker haven’t gone bankrupt, so there could be a slim chance they could succeed in some way down the road. Better Place could suddenly grow its customers; Fisker could launch a second car that becomes wildly popular. But let’s face it, these turnarounds aren’t likely. So while we’re waiting to see how they end up, these are my musings on four ways to fail as big as possible:

1). Overhyping the company or tech from the beginning: The big public fail wouldn’t be so big or so public if there wasn’t excessive media attention shining a spot light on the firm. For cleantech companies, usually these proclamations are about changing the world, and making it a — pun intended — better place. It’s pretty hard to live up to the goal of fundamentally changing the world.

But tech companies across sectors do this, too. Most tech and business journalists have been to the overhyped startup launch, where you watch the spectacle and wonder what the ratio of launch cost to time on this earth will end up being.

The overhype can come from not just the media, but from investors and the community, too. Solyndra, Better Place and Fisker attracted a lot of reputable investors that aggressively courted the companies and gave them really high valuations. Outside of cleantech, app maker Color had all the makings of overhype, as did Airtime.

2). The CEO ego: Sydney Finkelstein writes in his book:

“Instead of treating companies as enterprises that they needed to nurture, failed leaders treated them as extensions of themselves. And with that, a “private empire” mentality took hold. CEOs who possess this outlook often use their companies to carry out personal ambitions.”

We all know this type of CEO. Better Place, Fisker and Solyndra all seem to fall into this category. The CEO’s personal mission is intertwined with the company’s goals, and can even blind them (see my article on the problems with righteous investing).

Finkelstein also highlights how failed CEOs sometimes ruthlessly eliminate anyone who isn’t completely behind them due to their ego. I’ve heard that one specifically about Better Place (and some more successful companies, too, come to think of it). The problem with that approach is that often times it removes healthy criticism and also shows how leaders aren’t open to listening to dissenting opinions. Even if a company has the best idea, the execution can easily fail if there’s no constructive discussion of the best ways to proceed.

Finally, Finkelstein writes that failed CEOs “are consummate spokespersons, obsessed with the company image, but with leadership skills that can become shallow and ineffective.” He adds, “Instead of actually accomplishing things, they often settle for the appearance of accomplishing things.”

On the flip side, there’s always some element of ego in almost all CEOs of aggressive and game changing companies. But it’s when these traits overwhelm a solid business decision-making process that the companies get in trouble.

Workers inspecting panels in Solyndra’s factory in April

3). Lacking transparency, until it all comes out: Whether it’s full-blown financial malfeasance, or just mishandling of funds, not being transparent about finances are the fastest way to contribute to a high-profile demise. Suntech Power had its own financial scandal and the company got in trouble with a fund it controlled that financed solar power plant development in Europe.

Solyndra was never found to have used political ties to get its loan, but it seemed to be less than upfront to the media, to state and the federal government, and to its employees about its high costs and looming losses. Around 1,100 of Solyndra’s employees came into work one morning in August 2011 and were laid off that day.

4). Raise and lose a lot of money: It might sound obvious, but companies ultimately fail spectacularly because they raise a lot of investors money, and then lose the lot of those funds. Companies that lose several hundred thousands dollars aren’t going to be touted as a “big fail.” Small failures make up the majority of business in Silicon Valley. The big fails are hundreds of millions, if not a billion, dollars. Solyndra raised almost a billion, Fisker raised over a billion, Better Place had raised $850 million.

These types of losses have happened throughout all bubbles and busts and particularly for infrastructure companies, like the broadband buildout of the 1990s, or the thin film solar investment cycle of recent years. Venture capital firms can survive being involved in maybe one of these in a fund, but not many.

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“I don’t have an issue with the model, I had a problem with the company,” Agassi said on the sidelines of the Cleantech Investor Summit following a talk he gave on the future of electric vehicle infrastructure.

Agassi’s talk was the first time I’ve seen him speak publicly following his departure from both the board and his CEO role at a company he founded in 2007. He left a rapidly rising career at SAP to tackle the global problem of cars dependent on oil. Agassi wouldn’t speak about the details about what led him to part ways with Better Place and he told the audience he was legally bound not to talk about the situation.

But clearly he and the board — led by Chairman Idan Ofer, who is the single largest shareholder — had different ideas about how to run the company. Ofer is principal of Quantum Pacific Group, which holds the Ofer stake in Israel Corp. Ofer told Israeli publication Globes in late December that “[B]uilding and operating a company are different things, which require different skills. It is ordinary for a founder to leave management in Israel, and Shai Agassi still owns 10 percent of Better Place.”

It’s no secret that the uptake of Better Place cars in Israel, its flagship market, has been slow and losses have been mounting for awhile. The company had a loss of close to $500 million by the end of 2012, and at one point last year Israel Corp held a loss of $160 million. Agassi was replaced with Evan Thornley, CEO of Better Place Australia, but in early January, Thornely himself departed after just three months. Ofer became Executive Chairman, while CFO Alan Gelman stepped in to manage daily operations.

Now Better Place is cutting costs and doubling down on Israel and Denmark. The company made a wide round of layoffs in December, and just this week said it has cut both its U.S. and Australian divisions, in an effort to focus on its Israel and Denmark markets. In late 2012, Better Place also raised another $100 million with much of it coming from Israel Corp.

Agassi said at the end of his talk on Thursday that January numbers for the Israel network actually made him optimistic. Better Place has 0.5 percent of market share in Israeli, which is headed for 0.6 and 0.7 percent, said Agassi. That might not be a lot right now, but that same market share in the U.S. would be the equivalent of 50,000 cars a month, said Agassi.

Even if Better Place can’t make it through the Valley of Death, Agassi thinks battery swapping is the way to go. Eventually, all electric cars will likely have swappable batteries one day, said Agassi.

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It’s no surprise that LPs are growing cold on the sector. I discussed this with a panel of investors late last year at the VERGE conference. Salzman tells VentureWire that the reality from the LP community was: “show us the money.” Other firms that have pulled back (slightly or a lot) or changed their strategy to focus on green IT include Mohr Davidow, NEA, Draper Fisher Jurvetson, and Kleiner Perkins.

VantagePoint had a few wins, but it also has had many losses. On one hand VantagePoint backed Tesla and Solazyme, which both went public. But the company also backed firms like MiaSole, Serious Energy, Tendril, and Better Place, which have struggled. Bright Source was planning on going public but pulled the IPO in the 11th hour.

Salzman embodied the aggressive all-in approach of cleantech investing. He told me in an interview in late 2011 that “when it comes to greentech investing, it’s basically all or nothing.” And instead of becoming more cautious when the market cooled following the 2008 recession, Salzman and VantagePoint seemed to double down.

VentureWire asked Salzman whether focusing VantagePoint on cleantech was a mistake, and Mr. Salzman told them: “I wouldn’t admit it if it was.”

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This rate of production has been Tesla’s goal for months — if not years — and it’s a big step on the company’s path to profitability this year. Back in November, during its latest quarterly earnings, Tesla said it was on track to reach this milestone after having to scale back its original production goals a couple months earlier in September. It also means that all those customers on the waiting list to get their Model S cars — there were 13,200 as of the third quarter — will get their cars sooner, rather than later.

However, as I’ve written before, Tesla seems to be the exception rather than the rule in the struggling world of independent electric car makers and batteries made for electric cars. Electric car infrastructure maker Better Place shuffled out its second CEO in as many months last week, and laid off a big chunk of staff in the face of very slow adoption of its electric car service in Israel.

Electric car startup Fisker hasn’t made any of its hybrid electric Karma cars in months, and is looking for a Chinese partner, investor or acquirer with deep pockets to offer it a lifeline. Fisker’s original production goal at the beginning of its life was 5,000 Karmas in 2011, and it’s made around 1,900. A123 Systems, which has been making batteries for Fisker’s Karma, went bankrupt last year and then was bought by Chinese auto tech giant Wanxiang.

For the auto giants like GM and Nissan, which have been making their own mainstream electric cars, production isn’t a problem. It’s just that sales are a little slow. GM sold a total of 23,461 Volts in 2012, up from the 7,671 sold in 2011, and Nissan sold 9,819 Leafs in 2012, according to AutoblogGreen. GM originally wanted to sell 45,000 Volts in 2012.

So why is it so hard for independent electric car companies to meet their targets, and large auto makers to hit sales targets? For the auto giants, the market is only just emerging. GM’s Volt and the Nissan LEAF are the first mass produced plug-in battery cars on the market in the U.S. Auto exec Bob Lutz, who kickstarted GM’s Volt and is now on the board of some startups, says the transition to electric cars will be very slow.

For independent car startups, commercial scale production can be daunting and take a lot longer than expected, too. Many things can go wrong, and the it can take months to streamline the process of auto manufacturing. Tesla was founded back in 2003, and its pilot car — where it made errors and suffered delays — was the original Roadster. It’s taken Tesla this many years to get to its closer to mainstream auto maker status just pushing out 400 cars per week.

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Better Place says Idan Ofer, Chairman of the Board, will act as Executive Chairman and manage external relationships and alliances, and Alan Gelman, Global CFO for Better Place, will manage daily operations. According to reports back in October the board of Better Place removed Agassi in the face of mounting losses and a slow uptake of its electric car service in Israel.

Back in October, Better Place had reportedly wracked up losses of $490 million since it was founded, and Israel Corporation, which owns almost a third of the company, held a $160 million loss. Last month Globes, the Israeli business publication, also reported that 140 persons were laid off, and another 150 to 200 could be laid off soon.

Better Place spokesperson Julie Mullins told me last month that Better Place has 800 customers between Israel and Denmark, and the networks are nearly complete. Mullins also says that the company has growing momentum in Australia and a successful taxi program running in Amsterdam.

Better Place recently raised $100 million, in two tranches. In the Better Place release on the CEO change up, the company thanked Thornley for his leadership during the fund raising process. Better Place previously raised more than $750 million, and had raised a round in late August of $50 million loan (€40 million) from European Investment Bank. Investors include GE, UBS, VantagePoint Venture Partners and others.

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A Coda spokesperson said that 50 employees was 15 percent of the workforce. The company’s first electric sedan to market was delayed by years, and the car maker officially launched its sales in the Spring of 2012. But even after launch, the company had to recall 78 of its cars for faulty parts.

Coda has been directly competing with the LEAF in terms of price, all-electric features and the fact that both cars are pretty basic. Nissan’s LEAF has an official electric range of 73 miles and a 99 MPGe, and costs $35,200 (without subsidies). The Coda sedan has a base cost of $37,900 down from $44,900 (before any state and federal subsidies).

Coda has a joint venture with China battery maker Lishen, called Lio (oil spelled backward), and is in the process of raising $150 million in funding to help get these inaugural cars to the first customers in California. Other investors in Coda include Aeris Capital and Singapore-based EDB Investments.

This is a bad few weeks for electric car companies. Electric car charging infrastructure company Better Place delivered massive layoffs, electric car company Fisker Automotive is searching for a partner to help it get its Atlantic built, and battery maker A123 Systems was sold off in bankruptcy court to Chinese auto giant Wanxiang.

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The three companies suffered from different setbacks, though all are facing the fact that consumers and companies are adopting electric cars more slowly than expected. And the necessary next-gen batteries are still too expensive. Looks like Tesla is the last man standing when it comes to the aggressive electric car startups that launched over the past few years — and even it is not without risk.

If Better Place can’t make it in Israel. . .

Electric car infrastructure company Better Place started rounds of layoffs as its first network in Israel has been moving more slowly than expected. The Globes says Better Place Israel has already laid off 140 employees and will be cutting another 150 to 200. There were 400 employees at the company before the first round of layoffs. The company only sold 23 cars in November, its slowest month to date, said the Globes report.

The layoffs are disconcerting because Israel is essentially the proving ground for Better Place’s business model. Yes, Denmark is another early market, too, but in Israel, Better Place — and founder Shai Agassi — had a particularly close connection to the Israeli government and important investor Israel Corp.

Better Place, which launched in the winter of 2007, builds out electric car charging infrastructure and battery swap stations and then sells electric car charging and a subsidized electric car (Updated: made by Renault, part of the Renault-Nissan Alliance) like a wireless carrier would sell cell phone service. The company made some amazing strides in past years by managing to convince Israel and Denmark to act as early markets, by partnering with Nissan, and by raising so much money.

But the problem is that it’s expensive to build out the needed network to make the service work optimally. Whenever I asked Agassi in previous interviews throughout the years about that issue, he always waved away the seemingly high capital expenditures needed to build these networks. He commonly would compare the costs of the network to the prices of oil imports.

But if you’re working with investors, at some point they want to stop losing money and they want to start making it back. Israel Corp certainly did, which is one reason why it reportedly replaced Better Place’s CEO.

Better Place still could make it. The company has raised another $100 million in two tranches, Better Place spokesperson Julie Mullins told me. So they have some breathing room to try to make the offer more attractive to Israelis car drivers . But this week’s news is a worrisome turn of events for them.

Fisker on life support

Then there’s electric car startup Fisker, which is searching for a lifeline — a.k.a a partner or acquirer — to help it produce its second car, the Atlantic. It’s also stopped assembling its Karma cars and says it’s waiting to see what will happen with its now bankrupt battery supplier A123 Systems.

Fisker told the Wall Street Journal this week that it has hired investment bank Evercore Partners to help it try to sell itself, or raise more money. The company that had been helping it raise funds previously, Advanced Equities, is being shut down for lying to investors about raising money for another cleantech company, Bloom Energy.

If Fisker is sold off, I speculate that the valuation would be pretty low. I heard the company’s last fund raising round was at a far lower valuation than its previous fundraisings. Fisker has raised funds from Kleiner Perkins, NEA, and others. Fisker launched back in the 2007. The company has had a lot of problems and some pretty bad luck, too.

Battery bankruptcy

And finally, there’s the high profile bankruptcy of lithium ion battery maker A123 Systems. This week the company held an auction to see if American battery maker Johnson Controls or Chinese auto parts giant Wanxiang would win bids for the automotive division. There could be a lot of controversy if Wanxiang bought the company, as A123 was given a large DOE grant, and also had military contracts.

A123 Systems had a long slow death over its years as a public company. Fisker was one of its major customers, ad when Fisker had to downgrade a quarter of orders, it hurt A123 hard. A123 also didn’t scale up its manufacturing very well, and had problems with some of its batteries — particularly faulty batteries that caused problems for Fisker.

Like the deadly combo of electric car maker Think, and battery maker Ener1 — which helped bring each other down — A123 and Fisker also have contributed to each others’ problems.

Tesla still going

One of the last really aggressive startup electric car bets left is Tesla. Yes, the company had to lower its estimates of production of its Model S this year, but now it’s on track with new numbers. And Tesla CEO Elon Musk tweeted recently that the company “was narrowly cash flow positive last week.” Musk can be a little creative, so wait for the next earnings report to check on that one.

In addition, Tesla also had some other good financial news this week. Investment management giant Blackrock has taken a 5 percent stake in the company, according to the Wall Street Journal and an SEC filing. Updated: That WSJ story was inaccurate and has since been corrected. Blackrock already had a stake in the company and reduced its share to just under 5 percent, selling some off.

So what’s the difference in these three struggling companies and Tesla? Well, for Tesla, strong leadership, strong technology, a little bit of luck and good investors. But I’ll go into that in another post, in a few weeks.

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Better Place’s business model is to build out battery swap stations and electric car charging stations in regions and then sell electric cars like cell phones. Customers pay rates for charging cars and for a subsidized vehicle (made by Nissan) that has a swappable battery.

However, the model isn’t proven out yet, and Israel is the testing ground — and car sales have been slow there. Better Place only sold 23 cars in November, says Globes, which is “the lowest figure since it started marketing vehicles this year.”

Israeli customers don’t seem to be taking to the rates and plans as well as expected. Sam Jaffe, a senior research analyst with IDC Energy Insights, thinks the problem has been a marketing one. He writes in an article in October:

The Israeli car market is held hostage by a small oligarchy of leasing firms. Better Place chose to thread the needle by having those leasing firms be their distributors while at the same time not sharing enough profits with them. The leasing companies balked at becoming a middle-man, and froze Better Place out of the market. The solution to the impasse is for Better Place to either re-mold its Israel operations as a head-on competitor to the leasing companies or to renegotiate its contracts with them.

Meanwhile Better Place is the process of raising another $100 million from investors, with much of it coming from Israel Corporation. Better Place has already raised more than $750 million, and had raised a round in late August of $50 million loan (€40 million) from European Investment Bank to finish building out its networks in Denmark and Israel. Investors include GE, UBS, VantagePoint Venture Partners and others.

As of a few months ago, Better Place had wracked up losses of $490 million, with Israel Corp (which owns almost a third of the company) holding onto a $160 million loss. The President of Israel Corp, Nir Gilad, said during an earnings call in August: “I too would be glad to know when we will start making a profit from Better Place.”

Better Place spokesperson Julie Mullins told me last month that in Denmark and Israel, Better Place has 750 customers combined, and that more than half of the infrastructure is deployed in both Israel and Denmark — there are 24 out of 38 stations operational in Israel and in Denmark 12 out of 18 are operational, said Mullins.

Founding CEO Shai Agassi stepped down in October. Reportedly the Better Place board removed Agassi and replaced him with Evan Thornley, CEO of Better Place Australia.

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The funding news is positive news for Better Place, indicating that the company’s major investor Israel Corp is willing to double down on its investment in the startup despite losses. According to an article in Israeli business paper Globes earlier this month, the Better Place board removed Agassi and replaced him with Evan Thornley, CEO of Better Place Australia, after Better Place wracked up losses of $490 million. As of earlier this month Israel Corp. owned almost a third of the company and held a $160 million loss.

Better Place has already raised more than $750 million, and had just raised a round in late August of $50 million loan (€40 million) from European Investment Bank to finish building out its networks in Denmark and Israel. The roll out of cars in Israel has been slower than expected — NPR reported as of August that 300 cars were sold in Israel, fewer than the company would like.

Better Place spokesperson Julie Mullins told me that in Denmark and Israel, Better Place has 750 customers combined, and that more than half of the infrastructure is deployed in both Israel and Denmark — there’s 24 out of 38 stations operational in Israel and in Denmark 12 out of 18 are operational, said Mullins. On top of that there are 2 to 3 stations being added each week in both countries, she said.

Better Place installs both charging stations and battery swap stations to create a network that enables its users to drive electric cars with the same convenience of gas cars. Better Place partners with utilities and governments in countries to provide subsidies to make the cost of the electric cars to its customers very low, and partners with car companies like Nissan to make the vehicles’ batteries swappable. The customer then pays a subscription service for driving and charging the electric car.

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