ELECTRIC BIKE MANUFACTURER VANMOOF ON THE VERGE OF BANKRUPTCY

The Dutch startup VanMoof, which was engaged in the production of electric bicycles, found itself in a difficult financial situation. The firm continues to look for ways to reduce the existing debt and find sources for investment. At the same time, rumors that the Dutch company could go bankrupt seriously scared customers.

The reason for the fear was the technological component used in the operation of the manufactured devices. The company is the developer not only of the vehicle itself, but also of a digital application for bicycle control. Through it, the owner of the bike can detect its location or access it via Bluetooth. In case of bankruptcy, the company's servers may be disabled, and customers will not be able to receive a special electronic code that they generated to unlock the bike.

In 2021, VanMoof proudly claimed to be one of the most funded electric bike manufacturing enterprises. Over several rounds of fundraising in 2017 and 2019, the organization successfully attracted investments of $182 million. Experts estimated the total amount of the company's financial assets in the range from $189 million to $225 million.

The company decided not to use ready-made components when assembling devices, preferring to work with manufacturers directly. Buying a new bike for €3,498, the customer received a guarantee. She assumed that every bicycle malfunction must be repaired exclusively at the VanMoof service center. Within a year, the bike could be returned back.

The Dutch manufacturer began to lose money on maintenance. In 2021, about $8.92 million was spent on repairs. About 10% of orders in 2022 were returned. At the same time, the firm generated losses of €78 million annually.

However, at the beginning of 2023, information appeared that the company was on the verge of ruin. The company refused to accept new orders for its products, asking from €10 million to €40 million from investors. The money was needed to pay off the debts. However, only $5.23 million was raised.

The company did not resort to the popular solution of financial problems through the dismissal of its employees. However, the president of the company, Gillian Tans, who held the position of head in the past, left her post Booking.com . Taco Carlier also resigned from his position as CEO. He was one of the founders of the company. As a result, the company found itself without its head.

Competitors from the Cowboy company have already managed to take advantage of the fears of VanMoof customers. They have developed an electronic application that does not require access to the manufacturer's server, allowing you to generate a digital bicycle key yourself. However, now Dutch experts propose to legislate the rule on the open publication of the source code of the software in case the company is declared bankrupt. This will allow clients to save it on a third-party server without risking being left alone with an unmanageable pile of hardware.

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