And so is the government program that killed it
A decade ago, a small electric vehicle startup died. But now it’s back from the dead — and so is the government program that helped kill it.
This zombie company, called Aptera, is once again trying to sell people on a curious idea: an ultra-efficient three-wheeled electric vehicle powered, in part, by solar panels. And like a bad sequel, one of the villains from the first go-round is back, too: the Department of Energy’s Advanced Technology Vehicles Manufacturing program. The same program that famously saved Tesla from an early collapse also helped deliver the death blow to Aptera and a number of other startups along the way.
Aptera is not the only would-be EV startup that died seeking money from the government in a post-recession world. In fact, one of them — Fisker Automotive — got the money and still keeled over. But Aptera is the only one so far to walk among us once again. It even has its original founders at the helm.
Now, this undead company finds itself in a much different world, one brimming with optimism — and cold hard cash — for electric vehicle startups. But one thing’s the same: the office that ran the DOE’s loan programs is back. And Aptera is ready for another shot.
Steve Fambro and Chris Anthony founded Aptera in 2006, two years before Tesla started selling its first electric car, the Roadster. The pair came up with an idealistic vision of what one should be: something light, ultra-efficient, and futuristic.
It was the kind of optimistic idea that was popular at the time in the tech industry. Their car was electric, and therefore made no emissions. The solar panels on top made it possible to gather electricity from the sun to power the climate system. It was relatively lightweight and sported just three wheels, meaning it took up no more space than it needed to — practically sacrilege in a pre-recession world full of SUVs.
There was also what seemed like a great opportunity. General Motors had architected the most serious electric vehicle to date, the EV1. It not only abandoned the program in favor of its gas-guzzlers, but it literally crushed the EVs it took back from owners. Silicon Valley started training its attention on the transportation industry as a place that was ripe for disruption.
A few other early EV startups shared this romantic view of EVs back then, sparking similarly strange designs. But even among its peers, Aptera’s EV stood out. NBC called it “Jetson-like.” General Motors called it a “novelty vehicle.”
While Detroit dismissed it, Aptera won over parts of Silicon Valley anyway. Google, for instance, backed it through its philanthropic arm to the tune of a few million dollars. So did tech incubator Idealab. Part of Aptera’s plan relied on its vehicle being classed as a motorcycle to keep costs down — exactly the kind of regulatory arbitrage that Silicon Valley loved.
All this attention was enough to help Aptera convince around 4,000 people to put down $500 deposits by the end of 2008. But the closer Aptera’s vehicle got to the road, the further the company strayed from that original vision.
The new board of directors paid “a ridiculous amount of money” to recruit a new executive team, Anthony told The Verge, and eventually picked a new CEO from Detroit named Paul Wilbur in September 2008. Fambro took a reduced role as the company’s CTO as a result.
In December, just after he took over, the Department of Energy rejected Aptera’s application for the Advanced Technology Vehicles Manufacturing (ATVM) loan program. Electric vehicles were still viewed more as science experiments than proven products, so the program seemed like one of the safest bets a small startup like Aptera could make when it came to funding. The same program eventually gave out heaps of cash to Tesla, Fisker Automotive, and even Ford. But the DOE wasn’t evaluating three-wheelers.
Wilbur decided to redesign Aptera’s vehicle to adhere to the same standards for passenger cars, in hopes of convincing the incoming Obama administration to reconsider the rejection. On top of the redesign, he wanted to create a hybrid variant and a new, more traditional product to be designed as well: a car with four wheels.
The DOE agreed to consider three-wheelers for the ATVM program in October 2009. At that point, Aptera was simultaneously redesigning its main vehicle, developing a four-wheeled option, and slogging through the application process for the ATVM loan.
Aptera’s efforts to raise outside money stalled in 2010. By that point, Wilbur had essentially bet the entire company on the support of the government. The ATVM program was its last hope.
He nearly hit it big. Aptera got a commitment from the DOE for $150 million in 2011 — on the condition that the startup raise $80 million in the private markets. Wilbur and his team wore a path in the asphalt on Sand Hill Road. But the private funding scene was dry for automotive startups, especially with giants like General Motors having gone bankrupt. Aptera folded at the end of 2011 and sold off all its assets.
Fambro and Anthony were already gone. Reports at the time said they were forced out by the board, though Anthony maintains he left the company to start battery company Flux Power in 2009. Fambro was officially done in early 2010, and Anthony admits now he “got frustrated much quicker than Steve did.”
“We had a production-intent vehicle ready. And unfortunately, the production plans hinged on the Department of Energy loan,” Anthony recalls. “Steve and I had left Aptera, and the new management team did not get that Department of Energy loan, so they really had no path forward. The economy was crumbling and people just weren’t willing to put money into esoteric ideas.”
One former Aptera employee, who was granted anonymity to speak freely about the company’s collapse, said the loan was a “poison pill” for the startup. “The DOE loans were the worst thing to happen to the EV industry in the 2009-2010 time period,” they said. “It became the only litmus test for whether you were a viable electric vehicle company.”
Aptera wasn’t alone — even Anthony’s next company took a hit. Flux Power was developing batteries to be used in other vehicles, but without access to funding, many of them died out. “The ATVM loan program screwed Flux [Power] as well,” he says.
The Department of Energy handed out a life-saving loan to Tesla, as well as billions of dollars to major automakers like Ford and Nissan. But when startups like Fisker Automotive and solar company Solyndra defaulted on theirs, the program stalled. It hasn’t given out any new money since, despite there being more than $40 billion already appropriated. The ATVM program alone accounts for a $17.7 billion slice.
“I think it’s sad that $17 billion are collecting dust,” Anthony says.
“After the end of the first Aptera, I tried to just jettison it from my mind,” Fambro explained on a Zoom call in late December. Just a few weeks after leaving Aptera in 2010, Fambro said he already had a term sheet for his next company. He spent the next few years developing advanced hydroponic farms and running a clean tech fund for the royal family in Abu Dhabi but stayed close with Anthony. “Steve and I had always had it in the back of our minds that Aptera would be great to resurrect,” Anthony says.
In the meantime, Aptera was being stripped for parts. The startup’s investors — Idealab, energy company NRG, Google, and others — sold Aptera’s intellectual property in December 2011. Aptera also auctioned off all of its other assets in a liquidation sale, like power tools, computer towers, and even the signs on the Carlsbad, California headquarters. Chinese automaker Zhejiang Jonway won the bidding war for the startup’s vehicles, equipment and tooling, and IP, and so those went to China.
Zhejiang Jonway eventually tried in 2013 to spin out another independent company called Aptera USA that would make gas versions of the car in the US. It’s unclear if a new Aptera USA was ever even incorporated after Zhejiang Jonway’s announcement. The Chinese company never even filed to take over Aptera’s IP with the US Patent and Trademark Office, according to the government database.
This left Anthony and Fambro room to resurrect their original vision. “There didn’t seem to be any real hurdles in restarting the business just because it had laid fallow for so long,” Anthony says.
The pair decided to reanimate Aptera in 2019. Electric vehicles were no longer science fair ideas. Tesla was in the middle of a then-record year ahead of becoming the most valuable automaker on the planet, and the financial markets began throwing billions of dollars at companies working on electric vehicles. Other startups had even taken up Aptera’s original mission of trying to make a solar-powered commercial EV.
This time around, though, the new Aptera wants to take the idea much further, as it claims the solar panels on the vehicle can provide as much as 45 miles of range per day — blowing way past simply powering the air conditioning.
There are more than three square meters of photovoltaic cells on the roof that are nearly twice as efficient as the ones the original Aptera used, Anthony says. That capability, paired with a 100kWh battery pack and a shape that produces extremely low amounts of aerodynamic drag, could make it so that some owners never have to plug the new vehicle in to charge, according to Aptera. The startup refers to the car as having a 1,000-mile range and, in turn, refers to it as the “world’s first never-charge solar vehicle.”
These are staggering claims for any company, let alone a startup. When pressed, Anthony admits Aptera is painting a rosy picture, even for those lucky enough to bask in the Southern California sun.
“If you have a job somewhere that has an open parking lot, and you can park [the vehicle] out in the middle of that parking lot, and get lots of sun, [you’ll be] very happy with how much energy you created that day,” he says.
The new Aptera vehicle features more modern trimmings, too. There’s a large Tesla-style touchscreen on the dashboard. It will use in-wheel motors to save space and weight. It will have an attractive price, between $26,000 at the low end and closer to $50,000 at the high end — another big promise.
Anthony and Fambro didn’t just tweak the technology, though. They’ve also changed how they are financing their effort. They initially turned to a crowdfunding site known as WeFunder in 2019, which lets people contribute to the company in exchange for small equity stakes. Aptera raised some $200,000 in 2019 on WeFunder and roughly doubled that figure in 2020. Then, they mixed in some private funding and closed a $4 million Series A funding round in early 2021.
In March, Aptera filed with the Securities and Exchange Commission to raise another $50 million, again with a public-private mix. But this time, retail investors will have to go through Aptera’s website; the raise won’t be done on a crowdfunding platform. “We’re hoping that we can raise $20 million as quick as possible so we can get the wheels spinning to get into production,” Anthony says.
More than anything, this hybrid approach to funding the new Aptera is about one thing: Anthony and Fambro want to hold on to power this time. “It’s very crucial for Steve and I to make sure we retain control of the company so we can build it sensibly,” Anthony says.
As Aptera started talking about its funding plans more publicly, though, there was a series of announcements from the incoming Biden administration. Former Michigan Gov. Jennifer Granholm, who helped broker the recession-era auto industry bailout, was tapped to run the Department of Energy. And one of her first moves was to revive the loan programs office.
The DOE’s loan programs were “a bit moribund over the past few years,” she told The Associated Press, but it’s “an amazing tool.″ Granholm said she will work to streamline the process, too, so that it’s easier for companies to apply than it was back when Aptera took its first shot.
Fambro and Anthony were expecting something like this; in fact, they had already hired a lobbyist and spent tens of thousands of dollars. Anthony says they’re pursuing a loan in the $100 million to $150 million range, but that it won’t be necessary in the near term. Anthony says they’d most likely use the money to make a four-wheeled Aptera vehicle — something that’s also back in the company’s sights after the trouble it caused a decade ago.
The priorities may have shifted, but this is still a lot to take on for a startup. Aptera’s founders have a weird, exciting solar-powered three-wheeler; they’re thinking about designing a normal car; and they’re once again chasing federal funding. At least the landscape has totally changed.
“I’m stoked. Honestly, I think the first time around for us was it was almost like the cosmos was training us for this time around,” Fambro said. “We’re stronger. We’re better prepared. We’ve got loads of experience under our belt, you know, globally. And so I think we’re far more ready for it now than we were the first time around.”