Newsletter: More money, more problems for QuantumScape

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Secretive battery tech startup QuantumScape went public with a SPAC in November and quickly hit a $20 billion valuation. Not bad for a company that’s still years away from shipping a product. But now the erstwhile disruptor is adjusting to the harsh glare of that public spotlight.

Canary Media’s Eric Wesoff has been tracking the company for years, and he’s got a new story out parsing the latest twists in this saga. It features a vituperative screed” from a short-seller that made a billion dollars go POOF!, as well as more tempered calls for transparency and third-party vetting to back up QuantumScape’s bold claims about its technology.

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This storyline cuts across many of the themes that we launched Canary Media to cover:

  • Complex technology grappling with the thorny technical challenge of making batteries safer and more powerful, which is vital to the success of electric vehicles and a flexible, clean grid. 
  • Startups trying to tackle that problem in a business world accustomed to fast turnarounds and software-style growth. QuantumScape nevertheless managed to toil for a decade while attracting a roster of high-profile investors including Kleiner Perkins, Khosla Ventures and Volkswagen Group.
  • The collision of niche cleantech companies with public markets. In the last year or so, startups that used to court venture capitalists with deep sectoral knowledge jumped on the SPAC train and now can attract retail investors. This trend raises the stakes in terms of not only how much capital the companies can access but also the kind of scrutiny they’re receiving. 

As Bloomberg’s Akshat Rathi wrote in a recent dive into QuantumScape’s history, there’s a staggering risk that comes with believing in someone else’s unseen invention.”

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Julian Spector is an editor at Canary Media and reports on the rise of clean energy. He worked at Greentech Media for nearly five years, and before that he reported for CityLab at The Atlantic.