A legendary Israeli startup that was going to have us all driving electric cars and free our dependency on Arab oil is folding. The New York Times’s Isabel Kershner has the story. So does Forbes:
The green tech darling Better Place has flamed out, burning through $850 million with fewer than 1,500 electric vehicles sold…. [T]he story holds a trove of lessons about how (not) to launch innovative products.
A quick primer: Better Place sought to make EVs accessible through selling a single Renault model, leasing a battery and the electricity it uses. For about $350 a month, buyers would be able to access batteries and charge points.
The story is important to us because American Zionists fell in love with Better Place, and that love was communicated to the American press generally. The story served a “greenwashing” function; it cured Israel’s image as occupier with an image of a brilliant nation solving global warming.
Company founder Shai Agassi was the star attraction of neoconservative Dan Senor’s Zionist tract, Startup Nation, published in 2009. Per Time:
In the introduction to Start-Up Nation, Dan Senor and Saul Singer’s best-selling paean to Israeli innovation, Agassi was the soft-spoken software wiz who had a brilliant idea and a terrible time locating a backer. That doesn’t seem to be a problem anymore. “Not when you’ve digitized the most expensive molecule on the planet,” he says. “We’ve digitized oil.” He pauses. “I’ll put it this way: We have people from China here.”
Senor may be a neocon, but his view of Better Place was reflected by the liberal media. The unshy Agassi was all over National Public Radio. Steve Inskeep loved him in 2010:
We called up the founder of Better Place, Shai Agassi, to ask about his dreams of expansion. What are the challenges as you try to expand from Israel
They loved him in ’08 on All Things Considered:
Sound like pie in the sky? Well, the Israeli government has bought into Agassi’s scheme in an attempt to replace gasoline in that country before 2020.
They loved him on Morning Edition last year:
But Better Place says it isn’t deterred. In addition to Israel and Denmark, the company hopes to have battery-changing stations soon in parts of the U.S. and Australia.
I wonder what Tom Friedman will have to say about Better Place. The company fit his belief system, Israeli innovation and freedom from those vicious oil sheikhs; and Friedman embraced Agassi back in 2008:
What would happen if you cross-bred Henry Ford and Yitzhak Rabin? You’d get Shai Agassi. And what would happen if you put together T. Boone Pickens, the green billionaire Texas oilman now obsessed with wind power, and Shai Agassi, the Jewish Henry Ford now obsessed with making Israel the world’s leader in electric cars?….He [Agassi] figured no country has a bigger interest in diminishing the value of Middle Eastern oil than Israel…. “Israel will have the world’s first virtual oilfield in the Negev Desert,” said Agassi… His goal, said Agassi, is to make his electric car “so cheap, so trivial, that you won’t even think of buying a gasoline car.” Once that happens, he added, your oil addiction will be over forever. You’ll be “off heroin,” he says, and “addicted to milk.”
What business model am I talking about? It is Shai Agassi’s electric car network company, called Better Place. Just last week, the company, based in Palo Alto, Calif., announced a partnership with the state of Hawaii to road test its business plan there after already inking similar deals with Israel, Australia, the San Francisco Bay area and, yes, Denmark.
Friedman wasn’t the only one to plump for Agassi in the New York Times. Clive Thompson did a big piece in the Times magazine’s green issue about Agassi as visionary.
Shai Agassi stood in a warehouse on the outskirts of Tel Aviv one afternoon last month and watched his battery-swapping robot go to work. He was conducting a demonstration of the curious machine that is central to his two-year-old clean-energy company…
Going country by country, his start-up firm has begun to construct what it hopes will ultimately be a worldwide network of millions of small-scale “charging spots,” parking-meter-like posts scattered around downtown areas and along highways.
“You always have to start with the science,” Agassi says, riding shotgun in his sister’s hybrid.
How many other innovators get star treatment after two years? I’m all for green energy and electric cars. But that’s not the point. Better Place got hyped because it served a mythic narrative: Israel as a miraculous start up nation, making the desert bloom in defiance of Saudi Arabia. We can only hope that Better Place’s fall will catalyze a media/political reflection approaching that brought about by the collapse of Solyndra, which the Obama administration embraced.
P.S. The Times’s David Brooks saw Better Place’s collapse in March:
My main impression over the past five years is that the conference circuit capitalists who give fantastic presentations have turned out to be marginal to history while the people who are too boring and unfashionable to get invited to the conferences in the first place have actually changed the world under our noses.
Shai Agassi’s company, Better Place, for example, has generated glowing magazine profiles, but it has managed to lose more than $500 million while selling astoundingly few cars. He stepped down as the chief executive, and his replacement lasted only a few months.
But Brooks is part of the problem. Professedly “gooey-eyed” about Israel, he fell for Startup Nation when the book came out and said Israel was going to build things for the world, a “fruition of the Zionist dream”:
As Dan Senor and Saul Singer write in “Start-Up Nation: The Story of Israel’s Economic Miracle,” Israel now has a classic innovation cluster, a place where tech obsessives work in close proximity and feed off each other’s ideas.
Because of the strength of the economy, Israel has weathered the global recession reasonably well….
Israel’s technological success is the fruition of the Zionist dream. The country was not founded so stray settlers could sit among thousands of angry Palestinians in Hebron. It was founded so Jews would have a safe place to come together and create things for the world.
This shift in the Israeli identity has long-term implications…
During a decade of grim foreboding, Israel has become an astonishing success story, but also a highly mobile one.
How many of us believed the hype– and why?
What would happen if you cross-bred Henry Ford and Yitzhak Rabin?
I give up, Tom. what would happen if you cross-bred ford and rabin? (i’ll leave the punch lines for someone else.)
Friedman wasn’t the only one to plump for Agassi in the New York Times.
I think you meant to use the colloquial term ‘fluff’ or ‘fluffer’, not ‘plump’. friedman is a fluffer for these types, priming them for whatever it is they’re up to.
How many of us believed the hype– and why?
how many of us read friedman – or brooks – for anything other than the unintended humor or insight into a particularly goofy mindset?
“Because of the strength of the economy, Israel has weathered the global recession reasonably well….”
Has no connection with US foreign aid to Israel, both direct and indirect, eh?
Shai Agassi is the poster child of Israel’s technological industry. His resounding failure is an apt precursor to the inevitable collapse of Israel’s economy as a whole.
Even today, there are serious fault lines running across Israel’s economy, such as the gigantic budget deficit of NIS 40 billion (roughly 15% of the total budget), for which Israel’s newly minted finance minister (a man who barely finished high school) has had to take drastic measures in order to fill (for example raising taxes on the middle class – what else?)
Add to that a young generation whose educational benchmarks have been nothing short of awful the last few years (coming in well below many third world countries), and you’ve got a recipe for disaster.
The myth of Israel as an economic “miracle” has never looked so false and hollow.
“…and create things for the world.” Really? Hertzl said that? Or who said it, I wonder?
And this idea of “creating advanced technology absolves a person, group, nation or whomever, of brutality”…who came up with such a pathetic argument? It is morally nonsensical.
“Because of the strength of the economy, Israel has weathered the global recession reasonably well….”
Khalaas, ya’ni ..
http://www.haaretz.com/opinion/investigate-the-budget-deficit.premium-1.523649
“In tough language, Lapid’s economic program describes “the substantial deterioration in Israel’s fiscal stability” and warns of shocks to the system that could lead the country to “a fiscal and economic crisis requiring much tougher and more painful steps.” There is no choice, Lapid says. “Fiscal consolidation” is now the most important order of business. His document offers two explanations for the crisis: “insufficient state revenue” and major budgetary obligations that the last government undertook.”
Bibi sold the future to the settlers, more or less