Electric car company Better Place closes

Better Place, an Israeli electric car company that had hoped to change the world through battery exchange stations, announced today that it had ceased operation and declared the failure of this most fearless "clean technology" company.

Better Place was founded by Shai Agassi 6 years ago and its goal is ambitious, to make the world less dependent on oil. The specific approach is to establish a complete station system that allows electric vehicles to automatically unload used batteries and then replace them with new ones before the voyage.

Founder Agassi is the star of Israel. He founded Top Tier, a corporate portal vendor, at the age of 25, and sold it to SAP for $400 million in 2001. Agassi was promoted quickly in SAP and was once considered the candidate for the next CEO of SAP. However, in 2007, the contract extension of the original CEO made Agassi determined to find a better place, so he had Better Place.

Better Place is Israel’s banner to become a “startup country”. However, the bet of Better Place is highly risky because the layout of the station needs to be covered extensively. To achieve scale success, there must be stations throughout the country. Therefore, the company conducts tests in smaller countries such as Israel and Denmark. However, the initial investment has become a bottomless pit, and the introduction of services has been delayed. Competitors such as Tesla and larger car companies have not been able to compete with each other in electric vehicles, resulting in the current industry can not adopt the same standard.

Due to the limited battery range and the large initial investment in infrastructure, the company's viability has been questioned. At the end of last year, founder Aggasi was forced to leave the company. Then earlier this year the company closed its headquarters in Palo Alto, USA, and instead focused on Israel and Denmark.

Investors including Israel Corp, General Electric, Hang Seng Bank, European Investment Bank, Morgan Stanley, and VantagePoint Capital Partners have invested US$850 million in Better Place. Nevertheless, Better Place still can't see the hope of success. Therefore, the company with a valuation of 2.25 billion U.S. dollars finally had only Zhang Daji.

McKinsey recently published a study on the 12 major subversive technologies that determine the future economy. The study found that the hype of subversive technology does not necessarily match the feasibility and economic impact. Perhaps the closing of Better Place is a good footnote.