The founder of electric vehicle network company Better Place, Shai Agassi, who stepped down as CEO several months ago, told me Thursday that he still believes in the Better Place business model of using swappable batteries and charging subscriptions, and he still thinks the company can make it.
“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.