The Dutch e-bike manufacturer VanMoof has received a new capital injection from its shareholders. According to the company, that was not an unnecessary luxury: without this investment, the company would have run into problems after two months.
A spokesman for VanMoof has after questions from Het Financieele Dagblad let it be known that the company had to appeal to its shareholders, although the spokesperson wants to not say how much money the investors have put in and whether it is equity capital or whether they have provided loans. The newspaper writes that the preliminary annual report for 2021 states that the company has held talks with investors and suppliers to deposit between 10 and 40 million euros.
The FD writes that VanMoof in the preliminary annual report for 2021 and the accompanying executive report, which describes the situation up to December 29 last year, acknowledges that fresh money is needed, because otherwise doubts could arise “about the company’s ability to continue operations beyond the first quarter of 2023.” The annual accounts are preliminary and therefore not yet signed, because the accountant refused to do so because of ‘material uncertainty’ about the search for new investments. The newspaper also writes that the annual report shows that VanMoof must pay close attention to expenditure. The company has asked suppliers if it can pay invoices later in order to have enough money in cash until the new capital injection is realized.
Only the incumbent investors now appear to have actually invested money in VanMoof. These include London-based venture capital firm Balderton Capital and Chinese private equity firm Hillhouse Investment. The latter company acquired the Philips home appliances division in 2021. Both Balderton and Hillhouse were already part of an investment round in September 2021 in which VanMoof raised a total Raised $128 Million. A year before Bald Balderton also invested money in the bicycle manufacturer.
The company has expanded rapidly in recent years. For example, stores were opened in all kinds of European cities, in Tokyo and in New York. As a result, turnover rose sharply, but the rapid growth was also accompanied by significant losses. Last year there was a loss of 78 million euros and that was also the case in 2021. According to the FD, this means that VanMoof is rapidly passing through the approximately 200 million euros that the company raised from investors in recent years.
Another reason for the current financial situation mentioned is the problems with the bicycles, such as a relatively high number of defects and long waiting times for repairs. As a result, the manufacturer had to set aside 8 million euros in 2021. One reason for the long waiting times for repairs is that customers cannot go to a regular bicycle repair shop; VanMoof only uses its own parts.
VanMoof was founded in 2009 by the Carlier brothers, although the operational management of the company has been in the hands of Gillian Tans, the former CEO of Booking.com, since last year. The manufacturer is known for minimalist, relatively expensive e-bike models, such as the S5 and the A5 introduced a year ago. At the time, these had a suggested retail price of just under 2500 euros.
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