Zpryme Trendz Volume XIII

As Tesla declares a profit, or perhaps manufactures a profit as some suggest, it’s probably time to look at an informative story of a similar company.

Between 2005–2014 Shai Agassi promised that Better Place electric vehicles and the battery swapping stations he planned to build around the world would revolutionize the auto industry. In 2009 he taunted the incumbent auto companies, suggesting he would disrupt their $60k luxury car segment by building $20k electric vehicles that easily access battery swapping stations around the world. Shai Agassi graced the cover of every tech magazine worth its salt. Agassi spoke at Davos, TED and was a guest on late night TV shows. He was a hot shot founder who’d sold his previous startup to SAP for $400M and had no problems raising $900M for Better Place. Then, just as quickly as it had risen, Better Place was gone…

Better Place’s Loss Is Our Gain

Did Better Place just up and die? I say no, and that it offered lessons for companies that followed in its footsteps. Better Place’s experience taught Tesla that a better business model (pun intended) was to first secure some revenue, $5000 and $1500 reservations for EVs that were yet to be built. Better Place also provided economic signals about how to design charging stations, signals that utilities and Tesla have taken to heart. Some of the auto companies that Better Place had taunted would go on to develop battery charging technology that factored in the technical difficulty and complexity of battery swapping. Others focused on wireless (inductive) charging technologies, rolled out recently, to avoid swapping out batteries. Better Place didn’t die. Better Place moved the industry forward. The company might have stopped existing, but we all benefit from the mistakes the company made.


Is Tesla The Next Better Place?

Can we compare Better Place to Tesla, especially as Tesla celebrates what seems like a breakthrough of 5000 Model 3’s manufactured in 1 week? Leaving aside the comparisons/suggestions of hubris that can be laid at the feet of both Agassi and Elon Musk, I’d say we are at a much different time in the evolution of electric vehicles. The technology is much further along (especially battery technology) and consumer perceptions have shifted. Whereas previously, there were worries of range anxiety, now 69% of businesses consider electric vehicles as energy savingand cleaner alternatives to their internal combustion fleet of vehicles. It’s a different time for the adoption of electric vehicles, and I dare suggest that we might be crossing the chasm of adoption on the electric vehicle front. Many companies, especially utilities, that have done business in this ‘energy space’ will fail to see this shift for what it truly is; the utility business model is too dependent on how it used to be for the industry to understand this.

Courtesy: Zpryme/Ecova Research:

It might not be Tesla that gets us across the chasm from early adopters to the mass market; many investors are shorting the stock due to the variety of issues I’ve written about here. The traditional automakers, who’ve also jumped on this bandwagon (see BMW image and link above), might actually get us there. What Tesla is absolutely doing, though, is getting the average consumer more interested in a beautifully designed vehicle that happens to be electric. Just a few steps forward, similar to how Better Place got Tesla to where it is today. Elon Musk should send Shai Agassi a Tesla. Or at least get him a drink or two. But that depends on if Tesla can afford to start spending the ‘profits’ they’re making.

We’ll be holding the first workshop, ‘Using The Supermind (AI + HI) For Corporate Strategic Planning’ in San Antonio on Nov 20th. CPS Energy is providing the space, and we’ll focus on how to gather all the insights and signals from your historic data and mine your structured and unstructured data from within and without your company to determine your strategic plans, possibilities, and actions. Reach out to Seyi.fabode@zpryme.com or Jason.rodriguez@zpryme.com.

Until next time,

-Seyi Fabode