I’ve been quite fascinated by electric car firm Better Place since I read up on how the company was founded by former SAP executive Shai Agassi in the excellent book ‘Start-up Nation’, which tells of Israel’s historical entrepreneurial DNA and tech success stories.
Basically, Better Place aims to reduce global dependency on petroleum through the creation of a market-based transportation infrastructure that supports electric vehicles, relying on renewable energy from solar arrays and wind farms instead of oil. The startup, founded just 2 years ago, is currently building its first electric vehicle network in Israel, and plans to deploy the infrastructure in other nations on a country-by-country basis with initial deployments beginning this year, and commercial sales beginning in 2012.
As of April 2009, it had already raised $400 million, with several countries offering tax breaks in favor of the ambitious venture. This morning, Better Place announced that it has raised a massive $350 million follow-up venture funding round to lay the groundwork for these deployments, valuing the company at a whopping $1.25 billion.
HSBC led the round with a $125 million capital injection (buying them approx. 10% of the company), with eight other investors participating, including Morgan Stanley Investment Management, Lazard Asset Management, Israel Corp., VantagePoint Venture Partners, Ofer Hi-Tech Holdings and others.
Better Place says it intends to expand into markets where the business model economics and investor returns are “optimized”, citing Europe and Asia specifically. The company also reaffirmed its original target to begin full commercial operations at the end of next year, when industry partner Renault plans to offer the first car with a replaceable battery.