VanMoof could face insolvency or sale
The Dutch e-bike startup VanMoof is on the brink of bankruptcy. The Verge reports the company has entered a so-called ‘suspension of payment’ proceeding, in which a court-appointed administrator helps to lead the company out of debt. All options are on the table.
++ This article has been updated; please continue reading below. ++
The procedure is often the first step towards insolvency proceedings. Under Dutch law, the “surseance van betaling” process VanMoof just entered is typically granted for up to 18 months. Creditors cannot claim their debts during the said period, which ends once all creditors are paid, a final agreement with creditors is reached (private or judicial), or when the company is declared insolvent.
According to RTL Nieuws, the procedure has been approved by an Amsterdam court, which also appointed two administrators. The Verge also cites a “well-placed source” saying brothers and co-founders Ties and Taco Carlier would still run the company, with Taco continuing to act as CEO. However, the day-to-day leadership team will be joined by a court-appointed administrator with veto power over any decisions to spend money.
Anyone visiting VanMoof’s website will see a pop-up stating that the company has “temporarily suspended” the sale of its e-bikes “to catch up on the production and delivery of existing orders”.
In fact, according to media reports, VanMoof has closed all of its stores in 20 cities worldwide – to protect its employees, it says.
But perhaps not its customers. The Verge, on Wednesday, following rumours of problems at VanMoof, reported angry customers flocked to the company’s flagship store in Amsterdam to pick up their bikes, which had been brought in for service weeks ago.
The news also follows earlier reports of financial trouble at Van Moof. After closing successful financing rounds, the company repeatedly borrowed more money, including gathering 128 million dollars or 108.5 million euros in late 2021. According to the company, this was “the largest Series C investment ever made for a European e-bike brand”. Now the investors want their money back, it appears.
The Verge added Van Moof had posted losses of about €78 million each of the last two years. These are also due to selling e-bikes at a loss due to quality issues that require costly warranty repairs, so the blog.
The company is known for its boxy bikes with clear and thick lines. Its range includes pedelecs and faster e-bikes, such as the VanMoof V, that can reach up to 50 km/h when equipped with two electric motors.
Owners of the recognisable bikes already see doom. According to The Verge, members of the popular VanMoofing Facebook group “fretted over headlines” and urged each other to take protective action, like exporting their Bluetooth encryption keys. “If VanMoof becomes unable to cover its server costs, these keys might be lost forever, leaving countless bikes as electronic waste with no means of retrieval,” reasoned one posting from a top contributor.
The future of VanMoof is now up for the courts to decide.
Update 18 July 2023
Van Moof is bankrupt. According to the latest report by The Verge, the court in Amsterdam has withdrawn the so-called suspension of payments order and declared the e-bike brand insolvent.
The appointed administrators are now examining the possibility of a restart in order to continue operations. This includes looking into an asset sale to a third party to allow VanMoof to continue operations.
While a sale had been on the table already under the suspension order, the new court ruling means, that a company could buy up VanMoof’s operations and assets without having to take on the company’s outstanding debt.
The bankruptcy decision came quickly, despite the court having previously issued a two month cooling off period that protected VanMoof from creditors. The Verge adds it was understood that this can happen in cases “where administrators can easily see that a company has exhausted all available cash and any options for financing and sale”.
The blog also quotes from an internal email from the two VanMoof founders to the company’s employees confirming the insolvency.
As for owners of VanMoof bikes, the company says its e-bikes “will remain functional and rideable, as we aim to keep our app and servers online and aim to secure the ongoing services for the future.” Still, looking at the speed of change and alleged state of affairs at VanMoof, now might be a good time to download the bikes unique digital key.