𝗥𝗮𝗶𝘀𝗶𝗻𝗴 𝗠𝗼𝗻𝗲𝘆 𝗜𝘀 𝗘𝗮𝘀𝘆. 𝗕𝘂𝗶𝗹𝗱𝗶𝗻𝗴 𝗣𝗿𝗼𝗱𝘂𝗰𝘁 𝗜𝘀 𝗛𝗮𝗿𝗱
The EV industry is abuzz with the news of Canoo’s bankruptcy. What did it do? Like 99% of EV and cleantech startups, Canoo claimed to offer “breakthrough electric vehicles that reinvent the automotive landscape with bold innovations in design, pioneering technologies, and a unique business model.” In reality, they were just trying to build an electric minivan.
I don’t know the inside story of Canoo, so I can’t say exactly why it failed. Some commentators blame its SPAC structure—a shorthand for Wall Street’s “pump-and-dump” model. Others point to bad management like $1.7M spent on the CEO’s private jet despite revenue of just $800K. Some cite technical shortcomings, such as the lack of safety airbags. All of this may be true—or not.
I want to highlight something different. Canoo raised approximately $1.5B (according to PitchBook). It secured a non-binding offtake agreement with the U.S. Postal Service. It had a CEO with a strong track record. It kinda Yet, it still failed.
Discussions around scaling up climate tech often focus on financing. That makes sense—startups need money, and investors talk confidently about investing. But Canoo, along with Arrival, Redflow, Universal Hydrogen, and Northvolt, proves that raising capital is just one piece of the puzzle.
𝗙𝗶𝗻𝗮𝗻𝗰𝗲 𝗶𝘀 𝗻𝗲𝗰𝗲𝘀𝘀𝗮𝗿𝘆, 𝗯𝘂𝘁 𝗶𝘁’𝘀 𝗻𝗼𝘁 𝗲𝗻𝗼𝘂𝗴𝗵. Scaling climate tech requires more—operational excellence, engineering rigor, and execution discipline. The high failure rate shows that neither founders nor investors have fully mastered these skills.
What do you think? What are the biggest challenges beyond financing for climate tech startups?