The failure rate for startups is outrageous: something like 80% of all new business ventures fail. Those odds are enough to make almost anyone think twice about trying to create a new company, or at least carefully review their business plan. But what if you had a brilliant product to sell? A product that would literally change the world? Your success would be assured, right?
Shai Agassi believed the answer could only be yes, and thus begins the cautionary tale of Better Place.The story reads like a modern-day Shakespearean tragedy, and the main character is the clever and charismatic Shai Agassi, an ambitious Israeli-born businessman with an extraordinary vision and an ego to match.
Agassi started out with the idea to create a new kind of electric car. This car would be battery-operated, but would not take as long to charge as other electric cars. In addition, Better Place would set up an extensive network of super-efficient service stations where customers could either stop and recharge for a short period of time, or just swap out their battery for a new one and be on their way in mere minutes. The car would also be cheaper, affordable for middle-income families.
Good ideas all, but things didn’t quite pan out as Agassi promised his investors. When it came time to set up and run the business, Agassi did virtually everything wrong. Production costs ballooned and proposed timelines doubled, while Shai hired inexperienced friends and family to work for the company, but no one who had ever actually worked on an automobile. His frankly outlandish promises about his car were never substantiated, and within a few years, the company was bankrupt. All that remains now of Better Place is its story and a few abandoned battery-swapping stations near Tel Aviv. For all the excruciating details of the rise and fall of Better Place, check out the article by Fast Company: “A Broken Place: The Spectacular Failure of the Startup That Was Going to Change the World.”