Troubled e-bike maker Van Morff The company, which raised a total of $189.1 million from investors including Balderton Capital and Felix Capital, is now officially insolvent in the Netherlands after less than a week of administrative proceedings. As TechCrunch previously reported, the company is in a “payment hold” process with court-appointed administrators after we broke the news that the company had suspended bike sales.
VanMoof owners are now caught between a rock and a hard place, as VanMoof e-bikes require highly customized parts and a unique digital key connected to VanMoof’s servers to function fully, even though they can operate in a basic fashion without them. Incredibly, rival Cowboy has even launched an app that allows VanMoof owners to keep a digital key to their bikes.
That being said, the company says its e-bikes “will remain functional and rideable as we aim to keep our app and servers online and ensure continued service going forward.”
At the same time, people will ask how an e-bike maker with a long history and a mature supply chain could go out of business in the post-pandemic e-bike boom.
The e-bike market is booming
According to Fortune Business Insights, the e-bike market Expected to experience rapid growth globally. The market is valued at USD 35.69 billion in 2021 and is expected to grow to USD 91.19 billion by 2029 at a compound annual growth rate (CAGR) of 12.6%.
Meanwhile, dry weather in Germany, for example The number of electric bicycles has increased significantlyAccording to the ZIV Zweirad-Industrie-Verband (Association of the Bicycle Industry). In the first quarter of 2023, the export volume of bicycles was 260,000 units, an increase of 14% over the first quarter of 2022, and the export volume of electric bicycles was the most prominent, reaching 190,000 units, an increase of 56% over the first quarter of 2022.
Questions may also be asked of supporters. So far, VC backers have been silent, including London-based Balderton Capital, which participated in the Series C round. Other investors include Felix Capital (London), Gillian Tans, former CEO of Booking.com, TriplePoint Capital USA, Norwest Venture Partners, Stew Campbell, Hillhouse Capital Group, Shen Haoyu, Xinbang Electronics and Slingshot Ventures, According to Crunchbase.
As one e-bike industry insider told me: “VanMoof is so focused on marketing and spending a lot of money, but forgets to think about the supply chain and unit cost. Overordered after order was delayed.”
This emphasis on marketing rather than product excellence, supply chain, and unit cost likely contributed to VanMoof’s downfall.
Was VanMoof so “intoxicated” with VC cash-infused marketing budgets that he forgot to pay attention to the costs?
It didn’t help that the company’s crisis communications could have been handled better.
Despite these tumultuous times, the company has largely kept quiet about the rumors surrounding it, describing the delay in sales as “a feature, not a bug.” In late June, customers discovered that its online ordering system was no longer working, The reason was “unplanned system maintenance.”
Shortly after, the company’s Twitter account detailed that it was a technical glitch that caused the problem.
The situation changed again a few days later, with a spokesperson telling TechCrunch that the suspension was actually intentional to “catch up with delivery and production of existing orders.”
But as they say, the rest is history.
An internal email to employees today from VanMoof’s co-founders and brothers Taco and Ties Carlier, who started the company 14 years ago, said: “We are saddened, but most importantly, we cannot be happier with this Proud. Together we achieved something.” Here’s the full text of the letter:
Tice and I have been trying to figure out the future for VanMoof for the past few weeks. We regret to report that, despite our best efforts, we were unsuccessful and we had to file for bankruptcy. The administrators (now trustees) will explain what this means to you below, but we wanted to take a moment to thank you all from the bottom of our hearts.
We started VanMoof 14 years ago with a crazy idea to change the world. The only reason we can make progress is because of you: hundreds of dedicated and loyal people who help us in our mission of making cities better. We thank each of you and regret that we were not able to accomplish this mission together.
We are sad, but most of all, we are incredibly proud of what we have achieved together. It has been the honor of a lifetime for us, and while the current iteration of VanMoof ends today and we don’t yet know what the future holds, I am confident that VanMoof alumni will continue to be a force for good.
Sincerely best regards,
Taco and Tie Kalir