Better Place secures $350 million series B round led by HSBC Group; electric car start-up valued at $1.25 billion

Shai Agassi and the team at Better Place have done it again: almost two years to the day after announcing its first car partnership and its first country deployment in Israel, Better Place today announced that it has signed an agreement with an HSBC-led investor consortium for new equity financing of $350 million. The deal marks one of the largest clean-tech investments in history and values Better Place at $1.25 billion.

This Series B equity financing round features participation from new investors including HSBC, Morgan Stanley Investment Management, and Lazard Asset Management. These investors will join existing Series A investors including Israel Corp., VantagePoint Venture Partners, Ofer Hi-Tech Holdings, Morgan Stanley Principal Investments, Maniv Energy Capital, and Israel Cleantech Ventures, among others, as shareholders of Better Place. For HSBC, which led the round with an investment of $125 million, the deal represents one of the largest financial investments of its kind by HSBC.

As part of the deal, Kevin Adeson, HSBC Head of Global Capital Financing, will join the Better Place Board of Directors, and HSBC will own approximately 10% of the company’s shares.

“Today marks the end of an extensive process with the outcome being a decision by one of the world’s largest, most conservative banks, HSBC, to take the validating step of investing in a private company intent on bringing innovation to the trillion-dollar automotive and energy industries,” said Shai Agassi, Better Place Founder and Chief Executive Officer. “The strong investment commitment and global relationships that HSBC, Morgan Stanley Investment Management and Lazard Asset Management bring to the table combined with the continuing confidence from our original investors enables us to scale up globally and execute against our plan.”

In welcoming Adeson to the Board, Idan Ofer, Chairman of Better Place and Israel Corp., remarked, “Kevin and the entire HSBC team will bring more than just capital to the table. We expect that HSBC will help us to scale in Europe, China and beyond, and we’re already seeing the value that they are bringing to the company and the Board.”

Stuart Gulliver, Executive Director, HSBC Holdings and Chief Executive of Global Banking and Markets, said, “We believe the switch from internal combustion engine vehicles to electric vehicles will create future growth opportunities in the auto and utility industries, and we are delighted to take the opportunity of investing in Better Place to put HSBC at the heart of these developments. Better Place is a private-sector solution to the issue of infrastructure provision for electric cars and can succeed without government subsidy and without sacrificing consumer expectations for personal mobility.”

Better Place’s new board member, Kevin Adeson of HSBC, commented: “We are confident that Better Place has the technical and commercial solutions to allow for the mass adoption of electric cars in the near term. The Better Place switchable battery solution, which addresses the range limitation of fixed battery electric cars, will offer the consumer an affordable and attractive alternative to current combustion engine and hybrid vehicles. We expect the Better Place model to be widely adopted across many countries and cities, particularly in those markets with policies strongly favoring electric vehicle adoption.”

The financing allows Better Place to expand its geographic footprint while continuing to execute against its committed R&D and deployment milestones. The company intends to expand into markets where the business model economics and investor returns are optimized, notably in Europe and Asia.

Better Place says that it continues to meet its timetable for Israel and Denmark launch plans for the end of 2011 when the first Renault switchable battery electric cars hit the road. Better Place also will continue to execute against its strategy of early deployment projects in Australia and select North American markets a few months after the Israel and Denmark launches as planned.

Additionally, the company’s R&D team is currently testing each element of the Better Place solution in real-life scenarios around the world in a multi-phase cycle, beginning with the company’s managed EV network in Denmark, which began last December, and a Tokyo electric taxi project with battery switch station, which kicks off in April this year. These and other development milestones lead up to full-scale trials in the second half of 2010 and commercial launch in 2011.

Agassi added: “Our technology and solutions, together with our strong partnership with Renault, provide us at least a two-year time advantage over all other alternative energy vehicle approaches. Our solution is the only one that can scale to decrease countries’ oil consumption and significantly reduce emissions, while providing consumers with electric cars that are more convenient and affordable than internal combustion engine cars.”

“Better Place is a huge experiment in how you sell and fuel vehicles, and these investors are becoming convinced this will make money,” Rod Lache, an analyst at Deutsche Bank told the New York Times. “It is a financial validation. Now we need to see technical validation and consumer validation.”

The transaction is subject to approval by antitrust regulators and other customary closing conditions and is expected to close in the first quarter of 2010.

Related Posts:

Better Place unveils battery switch technology in Japan

Better Place applauds Hawaii's electric car legislation

Shai Agassi named to Time 100 list of world's most influential people

Better Place and Haifa to cooperate on electric car infrastructure

Better Place raises €103 million, names new Danish CEO

Better Place and Hawaii to partner on electric car project

Deustche Bank: Project Better Place has "the potential to eliminate the gasoline engine"

Better Place appoints Israel CEO, declares Israel as primary R&D center

Shai Agassi unveils Project Better Place electric car

Israel to adopt electric cars produced by Renault-Nissan and Project Better Place

Shai Agassi, Better Place, featured in Wired Magazine

Shai Agassi, the founder and CEO of Better Place, is on the cover of the most recent issue of Wired Magazine. The article, “Shai Agassi's Audacious Plan to Put Electric Cars on the Road,” is a must read for anyone interested in Shai Agassi, the origins of Better Place, and the politics and economics of electric vehicles.


Highlights include:

A Q&A with Israeli President Shimon Peres, who contends that Israel can be a global cleantech R&D center

A description of AutoOS, the Better Place operating system, and how it will transform the transportation grid. AuotOS will serve as an energy monitor, GPS unit, help center, and personal assistant, packed into an onboard PC that will also hold cellular and Wi-Fi chips.

Details of Agassi’s efforts, along with venture capitalist Michael Granoff, Better Place’s earliest investor and its head of oil independence policies, to lobby the U.S. government to create incentives for electric cars

An inside look at a Better Place meeting in Tel Aviv to determine the design of the company’s charge spots

A test drive of a Better Place prototype with the company’s chief engineers

News that Better Place is in discussions with Chery Automobile, the massive Chinese auto company, and is eyeing the Chinese market. (Israel Corp., which has invested $130 million in Better Place, has a joint venture with Chery Automobile, and Idan Ofer is Chairman of both Israel Corp. and Better Place.)

News that Better Place is raising $160 million to roll out the Electric Vehicle Recharge Operator in Denmark. (The company has already raised $200 million.)

Confirmation that Agassi has flown to Honolulu to meet with the Governor of Hawaii, which might become the first place in the U.S. to sign an agreement with Better Place.

Better Place names Israeli firm to oversee recharing infrastructure

In other news, Globes reports that Better Place has selected Massad Oz Management & Supervision Ltd. to manage the pilot recharging infrastructure deployment for the company's electric car venture. Massad Oz will set up the recharging infrastructure in Tel Aviv parking lots in the coming months.

Related Posts:

Better Place secures $350 million series B round led by HSBC

Project Better Place in talks with Mercedes, Hawaii, and San Francisco

Project Better Place presents prototype

Deustche Bank: Project Better Place has "the potential to eliminate the gasoline engine"

Cleantech attracts foreign investment

"From cutting-edge geothermal power deep underground to wind turbines and solar panels capturing energy from the sky above, foreign investors are pouring money into Israel's growing clean tech sector."

This is the opening paragraph in an article recently published by the Jewish Journal of Los Angeles.

The article provides an overview of Israel's cleantech sector and focuses on the importance of the United States, both as an export market for clean technologies and a source of funds for cleantech VCs and startups.

It includes quotes from Michael Granoff, President of NY-based Maniv Energy Capital and an investor in Project Better Place; David Rosenblatt, Vice Chairman of the Arava Power Company; Glen Schwaber, Partner at Israel Cleantech Ventures; Stacy Schusterman, CEO of the Samson Investment Co. and a major Jewish philanthropist; Assaf Barnea, CEO of the Kinrot Water Technology Incubator; and Jonathan Shapira, the author of this blog.

If you want to meet Assaf Barnea and learn more about water technologies in Israel, please sign up for the Cleantech Israel business network and attend our next event on July 29.

Michael Granoff speaks at Cleantech Israel event

The third Cleantech Israel "meetup" event took place on May 19 in Ramat HaSharon. Over 80 cleantech industry professionals, and a number of participants from North America and Europe, came to network and hear a presentation by Michael Granoff.

Granoff is President of Maniv Energy Capital and an investor in Project Better Place, and he shared with the group his thoughts on cleantech, Israel, and the future of transportation. If you were not able to attend the event, you can get a sense of his ideas on the subject by reading this blog post.

For "ex-VC" Tali Aben's reaction to the event, check out her blog.

Related posts:

Michael Granoff, leading cleantech investor, interviewed by Ynet

Cleantech Israel group meets in Herzliya

Highlights from the first Cleantech Israel meetup event

Michael Granoff, leading cleantech investor, interviewed by Ynet

Michael Granoff, a leading investor in Israel's cleantech sector, was recently interviewed for an article published on Ynet.

Granoff, the founder of Maniv Energy Capital, discusses his connections to Israel, his interest in cleantech, and his investments in Project Better Place and Israel Cleantech Ventures.

It is definitely worth reading. In addition to his role as an investor, Granoff is currently an "Oil Independence Specialist" for Project Better Place, where his "mission is to advance our ability to move countries off of oil by giving them a policy framework to speed the conversion from gas to electric drive. In advancing that mission, I also am responsible for generating public support for these policies."

The Ynet article is in Hebrew. For those looking for English information, I recommend checking out this blog post, in which Granoff outlines his views on energy security and cleantech and discusses the origins of Israel Cleantech Ventures and Project Better Place.