Getting a Charge in Jerusalem

by Brian on October 12, 2012

in In the News,Technology

I knew as soon as I’d read Saul Singer’s best selling book “Startup Nation” that I wanted one: a 100% electric car from the Israeli “startup” Better Place. Well, not exactly a startup. With an investment of over $750 million to date, Better Place is one of the highest-flying potential game changers to come out of Silicon Wadi. And I say that even despite all of the negative news that’s come out about the company in the Israeli press in the last week (see my previous post here).

A quick backgrounder for the three people who haven’t read Startup Nation yet: Shai Agassi founded Better Place in 2005 with a vision of weaning the world off oil by creating an electric car with a switchable battery. Agassi reasoned that electric cars were never going to take off unless “range anxiety” – that’s the fear that, if you go past your car’s charge limit, you could wind up stranded on the side of the highway – was addressed.

Better Place’s solution is to sell not just the car and not just the battery, but to build a country-wide infrastructure of battery “swap stations” that will enable you to travel beyond the car’s 140 kilometer limit by pulling into a station and, within 5 minutes, to drive off with a brand new fully-charged battery. The whole swap is handled robotically – it’s like one of those drive-through carwashes; you never even get out of your vehicle.

Better Place’s other innovation is the idea of treating your car like a cell phone. Instead of paying for each swap, you are billed a monthly amount (there are various plans and monthly minimum) which covers your fill-ups – whether at a charging spot at your home or work or at a swap station – as well as any software or hardware improvements (longer lasting battery, for instance).

Better Place has been building out the swap stations in Israel, Denmark and Australia – its three proof-of-concept countries – over the past year. In Israel, 24 are online so far out of a total of 42 planned (the rest are promised by December).

Once it became possible to drive the length of the country – from Metulla to Eilat – all by swapping batteries, Better Place began selling their first vehicles. That was in July. We dropped in to Better Place’s shiny visitor center in Herzilya, which offers free tours (in Hebrew and English), at the end of the summer, not really planning to make a purchase, just to try it out. A week later, we were signing paperwork and taking out a loan from the bank.

The pricing is reasonable, in my opinion – the cost of the Fluence is equivalent to a four-door sedan – but buyers have been hesitant to commit to such a new technology, even with an almost too-good-to-be-true financing deal with Bank Igud for a loan at only 2.75% interest. Two weeks ago, Better Place came out with a leasing option for NIS 2,000/month, which should go a long way towards mitigating those concerns. I just got a Facebook message that a colleague is starting a leasing group to negotiate for a set of cars at a discount. Within a few hours, 20 people have already said they want in.

I’d like to show you a picture of our shiny new “Energy Blue” car…but I can’t, at least not yet. First, Better Place had to install a home charging spot – that was yesterday. You can see a picture of it in our garage above. When the light on our box turned on, it was an electrifying feeling (OK, I had no choice but to work that one in somewhere into this post).

The last week has been nerve wracking (another electric pun?), as the press has dished out generous helpings of vitriol on the company and its business model following the ouster of founder Agassi and revelations of how deep Better Place’s financial woes go, all of it calling into question whether we made a smart decision.

I stand by our choice. If the concern is that Better Place isn’t selling enough cars, then some of us have to be the first to jump together into electric dreams. I truly want Better Place to succeed, and not just to protect my own investment. I believe in the vision of a world without dependence on oil and the nations that sell it (whose interests are not always aligned with Israel’s).

That may still take a little explaining. So when we pick up our car on Sunday, I’m ready to become a walking, talking Better Place FAQ. How could it be otherwise with the words “100% Electric” written large across the side of the vehicle?

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