Follow the Money: Are electric flying cars ready for takeoff?

Would you believe three recent IPOs for battery-electric air travel? And investors are still bullish on earthbound battery applications too.

(Corbis via Getty Images)
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Canary Media just covered the tidal wave of cash going into grid-scale energy storage and the bubble building up around the more speculative subset of long-duration energy storage. This rush toward energy storage is not a surprise: A recent report from consultancy Wood Mackenzie projects the U.S. storage industry will be worth $8.9 billion a year by 2026

Now we have more climatetech investments to catch you up on, starting with electric air mobility and the increasingly diverse battery sector.

Decarbonizing air travel: Urban vertical-takeoff transport

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(Lilium)

Attendees of the 1964 New York World’s Fair at Flushing Meadows in Queens were promised moving sidewalks, wrist radios and flying cars. It looks like we’re finally getting a bit closer to flying cars.

Since August, three companies developing small, all-electric battery-powered aircraft that can take off and land vertically got big infusions of cash through special-purpose acquisition company (SPAC) mergers. 

Lilium, a 700-employee startup based in Munich, Germany and founded in 2015, just began trading on the Nasdaq after merging with Qell Acquisition Corp. — another SPAC merger by a company with zero revenue. Lilium wants to launch a high-speed regional air travel service based around its seven-seater jet, which the company claims is the first all-electric jet capable of vertical takeoff and landing. Commercial operation is slated to begin in 2024.

As a result of the SPAC merger, Lilium will receive approximately $584 million of gross proceeds. Investors in Lilium include Atomico, Baillie Gifford, BlackRock, FII Institute, Ferrovial, Honeywell, Lightrock, Palantir, Pimco and Tencent. 

Archer rang the opening bell at the New York Stock Exchange last week as it went public with its promise of an urban electric jet that also has vertical takeoff and landing capability. Its pre-revenue SPAC merger with Atlas Crest Investment Corp. generated $858 million of gross proceeds.

Joby Aviation went public last month, in yet another pre-revenue SPAC deal, merging with Reinvent Technology Partners in order to fund the commercialization of all-electric vertical takeoff and landing aircraft for aerial ride-sharing. Reid Hoffman, co-founder of LinkedIn and co-founder of Reinvent Technology Partners, describes Joby as Tesla meets Uber in the air.”

The proposed aircraft would have a range of 150 miles on a single charge and be able to transport a pilot and four passengers at speeds of up to 200 miles per hour, according to the firm. Joby employs more than 800 people and has a market cap of $6.2 billion.

Battery-swapping is real — just not in cars

Battery-swapping in electric automobiles has not yet been commercialized (see Better Place’s past and Ample’s current efforts).

But battery-swapping in electric scooters is a big enough business for Taiwan’s Gogoro to go public on the Nasdaq stock exchange via a SPAC merger with Poema Global Holdings that values the firm at $2.35 billion, according to the company. The deal is scheduled for early 2022

Gogoro — the world’s largest battery-swapping network — has deployed 800,000 battery packs and generated $1 billion in revenue in less than five years, according to a press release. The company has grown its Taiwanese electric-scooter client base to over 400,000 subscribers, and it’s now looking to move into markets in India and China.

(Gogoro)

While Gogoro manufactures electric scooters under its own name, it also works with other scooter brands such as Hero MotoCorp, Yadea, DCJ and Yamaha.

Gogoro electric urban scooters, soon to have their batteries swapped out. (Gogoro)

The company aspires to become a distributed-energy firm that can power a range of mobile devices and whose charging stations might conceivably be able to serve as a power source during grid outages and other disasters.

Gogoro has raised approximately $500 million from investors including Foxconn Technology Group, GoTo Group, Al Gore’s Generation Investment Management, Taiwan’s National Development Fund, Temasek and Gogoro’s founding investor, Samuel Yin of Ruentex Group.

An alternative to lithium-ion batteries attracts $100 million

EnerVenue, a Fremont, California-based startup developing nickel-hydrogen batteries for utility-scale energy storage applications, has raised $100 million in Series A funding. Schlumberger New Energy led the round, accompanied by Saudi Aramco Energy Ventures and others. 

The firm launched in 2020 with $12 million in seed funding from Doug Kimmelman and Peter Lee. EnerVenue claims that its metal-hydrogen batteries operate within a wide temperature range of -40 degrees F to 140 degrees F and have a 30-year lifespan with the ability to run through more than 30,000 cycles without degradation, while presenting little risk of fire or thermal runaway. 

VCs are searching the globe for EV startups

Sophie Purdom and Kim Zou track venture capital deals in their Climate Tech VC newsletter. They logged these international EV and battery startups raising cash in the last few weeks. 

  • VanMoof, a Netherlands-based startup that designs and markets electric bikes, won $128 million in Series C funding from Balderton Capital, Felix Capital, Gillian Tans, Hillhouse Investment and TriplePoint Capital.
  • LeydenJar, a Netherlands-based EV battery startup, garnered $26 million in Series A funding from Catalus Capital, Invest-NL, Somerset Capital Partners and Yard Energy.
  • Echion Technologies, a U.K.-based startup making fast-charging batteries, raised $14 million in Series A funding from the University of Cambridge, Origin Capital and others.
  • Accure, a Germany-based provider of battery safety software, banked $8 million in Series A funding from Blue Bear Capital and Capnamic Ventures.
  • Revos, an India-based EV infrastructure platform, landed $4 million in Series A funding from Prime Venture Partners and Union Square Ventures. 

Recycling batteries

Battery Resourcers, a vertically integrated lithium-ion battery recycling and manufacturing company, closed its latest funding round of $70 million from investors including At One Ventures, Doral Energy, Hitachi Ventures, Jaguar Land Rover’s InMotion Ventures, Orbia Ventures, TDK Ventures and Trumpf Ventures. 

Battery Resourcers plans to use the capital to further develop its closed-loop material production and recycling process, as well as expand its commercial plants. The funding will provide the company with the capacity to produce over 30,000 tons of battery material per year, according to the firm.

Confronting the lithium bottleneck with $150 million

Lilac Solutions of Oakland, California is developing a system that extracts lithium from what it calls brine resources,” or natural deposits of salt water, with high efficiency, minimal cost and an ultra-low environmental footprint, according to the company.

The lithium-extraction technology startup just announced the first close of a $150 million Series B financing led by Lowercarbon Capital and funds and accounts advised by T. Rowe Price Associates, along with new investors including Mercuria Energy Trading and Valor Equity Partners and existing investors Breakthrough Energy Ventures and The Engine.

Lilac recently completed its first field pilot.

Electric vehicles are a low-carbon success story, but the lithium raw materials needed for batteries have become a serious bottleneck,” said Dave Snydacker, CEO of Lilac. The lithium industry has been plagued by technical and environmental problems that have put the energy transition in jeopardy. Lilac’s technology solves these problems and will finally enable lithium production at a scale demanded for the energy transition.”

The surging electric vehicle market is forcing the lithium industry into a state of volatility as it confronts unprecedented demand growth. Lithium now accounts for about 10 percent of the cost of making a battery cell, according to Snydacker. 

The CEO contends that the EV market has driven the battery industry to such scale and throughput that much of the manufacturing cost has already been squeezed out, and now we’re starting to bump up against the cost of materials. 

In a previous interview, Snydacker told this author that there are dozens of lithium resource developers in the U.S., Argentina and Chile that know where to find brine that contains lithium. What they’re missing is the extraction piece,” he said. That’s what Lilac claims to have figured out. 

Eric Wesoff is the managing editor of Canary Media. He's a prominent industry journalist, analyst, writer, consultant, speaker and expert witness in the renewable energy field.