Venture Vehicles Hits The Road With $6M Series A
By Jonathan Shieber 8/20/2007

The electric vehicle gold rush is drawing more capital to the West Coast as companies race to get U.S. consumers behind the wheels of new, fuel-efficient vehicles.

The latest vendor to get into the race is Venture Vehicles Inc., which raised $6 million in Series A funding from NGEN Partners to bring its three-wheeled electric hybrid and fully electric vehicles to market.

The financing will support design and engineering of the company's prototype vehicles and brand development for the new vehicle company, according to an interview with Venture Vehicles co-founders Howard Levine and Ian Bruce.

The Los Angeles-based company is not the first venture-backed start-up to enter the market with a three-wheeled vehicle. Pasadena, Calif.-based Aptera Motors Inc., an Idealab-incubated company, is also looking to sell consumers on a three-wheeled hybrid or fully electric vehicle.

Unlike Tesla Motors Inc. or Think Global AS, two other venture-backed start-ups which have both raised significant capital to develop electric cars, Aptera and Venture Vehicles are pursuing a somewhat less arduous path to market.

These companies' vehicles, because of their design, aren't classified as automobiles and aren't required to adhere to the same safety standards as four-wheeled vehicles. Even so, the company's founders said that safety features are just as important as the gas mileage for this new type of vehicle.

"This is a fully enclosed vehicle that is much closer in performance and spirit to an automotive vehicle than a scooter or even a motorcycle," said Bruce, Venture Vehicles' executive vice president of design and engineering. "We are including things like a steel roll cage, collapsible steering columns, side impact rails, driver's air bag and a rear bumper."

The electric version of the company's new vehicle will have a range of approximately 100 miles before requiring a charge, and a charge time of 90 minutes, while the hybrid version would have a 4 gallon tank and a range of 400 miles before needing refueling, according to Bruce.

Venture Vehicles already has a number of partners on board to help the company hit its aggressive manufacturing targets. Chief Executive Levine wants the company to have its first vehicles on the road by the second quarter of 2009. Early prototypes will be on the road by 2008.

The initial vehicle design has been licensed from Carver Engineering Inc., a subsidiary of the Dutch manufacturer DVC Technologies NV based in Dordrecht, The Netherlands. Carver Engineering already produces a gasoline-powered version of the three-wheeled vehicle, but Venture Vehicles has the sole license for the production of electric and hybrid versions of the design in the U.S. and first refusal for production internationally.

In addition, the company has signed up Camarillo, Calif.-based California Motors to develop its propulsion system, and San Clemente, Calif.-based Swift Engineering Inc. to develop its chassis design and drive train, according to Levine.

"We are sourcing the assemblies and sub-assemblies offshore and then assembling the vehicles here in the States," Levine said. The company is looking to site its first manufacturing facility somewhere in the Southwest and West, and is currently looking at opportunities in Southern California and New Mexico, Levine said.

Venture Vehicles has already signed up one of the big automotive marketers, Automotive Marketing Consultants Inc. - the firm behind the launch of the Lexus, Prius and Scion lines - to help pitch its new vehicle to customers in California first, and then slowly throughout the country, Levine said.

Some analysts who cover electric vehicles are skeptical about the appeal of a new product that, at $20,000, is priced halfway between a motor scooter and a hybrid vehicle. For them, the mass appeal of the vehicle is a concern.

"We think we will actually compete with next-generation electric vehicles," said Steve Parry, a managing Member of NGEN Partners, and a new director at Venture Vehicles. "We're in a very unique niche for the commuter that is interested in a unique ride that is getting close to 100 miles per gallon."

Consumers in the automotive market want greater diversity, Parry said. "Tesla got the ball rolling," in the electric vehicle market, "but there's going to be a variety of these vehicles and the consumer is going to have a range of products from which to choose."