VC Firms Expected To Take A Billion Dollar Bath On Fisker
PrivCo, a private corporate intelligence firm, has published a 20+ page dossier on Fisker’s seemingly strong ability to fundraise for itself, while failing to do a good job of actually creating cars. With Fisker teetering on the verge of bankruptcy, the results are staggering; with just under 2000 units sold, Fisker burned through an estimated $1.3 billion in venture capital, taxpayer-funded loans and private investor funds.
According to PrivCo’s estimates, that amounts to $660,000 per Karma sold. PrivCo has charted out an extensive, detailed timeline of Fisker’s operations, and highlighted key information pertaining to corporate developments, government loan proceedings and the various ways that Fisker breached their agreements with the government. What materializes is an amazing picture of how Fisker was able to raise enormous sums of money merely on the promise of providing a “green” car for the very wealthy few, without every creating anything tangible or ready for the marketplace. According to the firm, the government
“…applied negligent underwriting standards in granting the DOE Loan and Credit Agreement to Fisker, which was by any commercial standard clearly a financially unqualified borrower for the loan.”
You can view the full report at PrivCo’s website.
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The folks who invested in Fisker are big boys (translation:wealthy). They knew what they were getting into.
Only 2000 sold? Someone in my garage at work drives one, and I have seen another here too (maybe a loaner?) And I have seen at least one on the road. But I am stuck in the music business in Santa Monica. I see Teslas all the time in LA though, but not in our garage. There are a couple of Volts and several Leafs here. But there are more Bentleys than all those put together. (up intill a year ago I loved the looks I got driving past them to my spot in my 65 Dart wagon)
Here in Central Florida, I have never seen a Fisker or a Tesla in the wild. There are the occasional Volts, but those are usually wearing paint jobs for some business that's trying to earn some green points. And we taxpayers only got hosed for $1/2 billion? Why for that money, they should at least drive a Karma in the next 4th of July parade, so we can see one on the street and not in a car show.
I remember when the Fisker was first shown at the NAIAS. The folks from Kleiner Perkins, the VC company, were almost giddy. Talking to them it was clear that they knew almost nothing about the auto industry, another universe they were sure they could master.