Shai Agassi Launches Electric Car Startup, Raising $200M


agassi1.jpgShai Agassi, the entrepreneur who, at one time, was expected to take over the CEO role at SAP, said today that he has formed “Project Better Place,” a venture focusing on electric vehicles, and is raising an initial $200 million to fund the project. When Agassi announced his resignation from software company SAP (SAP) last March, he said he looked forward to working on alternative energy issues. Aren’t we all these days? This, however, is no small undertaking.

While this isn’t the first news of Agassi’s electric car ambitions, this is the most detailed information provided to date. The list of investors includes Israel Corp., Morgan Stanley (MS), VantagePoint Venture Partners, and private investors James Wolfensohn, Edgar Bronfman Sr. and Musea Ventures. The venture will focus on building out an infrastructure of battery-charging stations for electric vehicles; the comparative model offered is that of mobile phone companies building out the mobile infrastructure.

The company says it will work with car and battery makers so that subscribers to the network can get subsidized vehicles, but consumers will still own their cars. The WSJ says that the company will buy and own the batteries and that Agassi expects the subscription to be less than the economics for current gas-based cars.

The New York Times has the money quote for the mobile network comparison: “If you think of Tesla as the iPhone, we’re AT&T,” Agassi tells the NYT.

Update: We chatted with Tesla’s VP sales, marketing & service, Darryl Siry, about Agassi’s venture, and he said that anything that provides more places to charge Tesla cars, the better. We welcome the distribution of charging stations, he said.

While Siry said that the details of Agassi’s business model are still unclear, he also pointed out that the model of leasing batteries is unproven because there is no secondary market currently available to buy those older batteries. Siry also compared the idea of battery exchange charging stations to the propane business, and noted that this is a technically challenging model to pull off. “No one has figured out how to practically do that, but if they could it would be very compelling,” Siry said.

The company says that over the next two years, it will build out the infrastructure and put hundreds of thousands of vehicles into its network, and it hopes to have the system widespread within 10 years. In the release the company says its “new grid presents a practical solution to address barriers to electric vehicle adoption.”

As GigaOM readers well know, any venture focused on building out infrastructure and a network approach requires a massive amount of capital. And as the WSJ points out, Agassi has no background in the auto or energy industries. The plan will likely take billions of investment to build, and will depend heavily on developing those industry relationships.


Steve Kumar MS Engg,, MBA Pres & CEO

Dear Agassi, Pl. call us for your project. We might help in arranging capital for your company. Pl. call us at 714 968-0010.

Steve Kumar MS Engg,, MBAPres & CEO

We are interested in talking with Mr. Agassai and might arrage more capital for his Electric Car project. Pl. contact us at 714 968-0010.
Steve Kumar

frank bushere

shai and team I live in a small town in Washington state in the United States, Rochester we would love to be a test site for your new electric car trunks and farm equipment, it is important that our food, is brought in diesel trucks that are electric, can you help us with this in the United States thank you
frank bushere 1-360-273-0234 or


I am sure that the courage, determination and innovative spirit of Shai Agassi will succeed. Anything new will always have challenges and problems to face. But that is how nations and companies progress. I am very confident that entrepreneurs like Shai will someday be emulated for his innovations and it will greatly benefit the whole world for if he becomes succesful in this venture he will not only become rich but help the environment and help us become independent from Mideast oil.

Darryl Siry

small point of clarification – the aspect of Shai’s business model that I compared to the propane business was the part described by the NYT as battery exchange stations, where people driving certain types of cars could drive up and have their spent batteries exchanged for fresh batteries, similar to what we have grown accustomed to with propane tanks.


Aside from the practicality of this business, will this method really improve the environment if the charging stations will still be using traditional forms of energy to charge the batteries?

kent beuchert

The main failure of logic in this whole scheme is its
assumption that the main problem with electric cars is the slow recharge rate of their batteries. That’s
dead wrong – economics is the main obstacle – batteries are too expensive, something this scheme not only doesn’t understand, but makes worse.

kent beuchert

This is perhaps the most unlikely business model I’ve seen – it depends upon so many unlikely events – Ev carmakers designing cars to place their 500 to 700 pound battery pack in the rear and easily accessible, battery technology to not advance to the point of fast charge batteries, which would destroy his entire business, and a business space with no competitors. This business model can be uterly detroyed in so many ways and requires a whole lot of highly unlikely events to occur. And besides, plug-ins are the only economical method of electric propulsion,
and will make this scheme pointless. For a long lifespan, li ion batteries need a cooling system, and that makes the prospects of easily replaceable battery packs even less likely. If cooling is not used, the prices will skyrocket.

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