Elio Motors is crowdfunding its entire $25M investment round

https://www.startengine.com/startup/elio-motors

by prostoalex • 11 years ago

84 84 11 years ago

trothamel• 11 years ago

Is there any reason to think this attempt at a three-wheeled motorcycle/car would be more successful than previous iterations? It's been tried a lot in the past, but it doesn't seem to have ever really caught on.

https://en.wikipedia.org/wiki/Category:Three-wheeled_motor_v...

joshuapants• 11 years ago

It does seem likely that this could end up being Aptera Part II.

ndonnellan• 11 years ago

I was wondering when someone would bring that up:

https://en.wikipedia.org/wiki/Aptera_Motors

"As of January 2010, the number of unique deposits tracked at the unofficial Aptera forum surpassed 5000."

CodeWriter23• 11 years ago

Maybe, and I do mean "maybe" the cost of vehicle ownership and fuel costs are factors that would incentivize such a purchase.

I know we are a corner case, but I would consider purchasing one of these. Well, if they get some YouTube crash videos up like the SmartCar video... My family works on a "primary car / backup car" basis. Most of our combined driving needs are covered by our TDI wagon. When we infrequently both need to drive on the same day, whomever is going on the longest trip takes the TDI, and the other takes the beater. I could see a car like this replacing the beater, or becoming the car used by whomever isn't driving our daughter on a given day.

obstinate3• 11 years ago

There are some reasons to think so. It's fully enclosed. It might be better constructed. The price is pretty low. Fuel efficiency is good.

Maybe it will, maybe it won't. Personally, I like to see marginal ideas tried again every couple of decades. An idea might click with the public in one decade that wouldn't have two before, because of changing perceptions and needs.

tptacek4• 11 years ago

Completely public crowd-investment in startups is a bad idea. Crowdfunding is (mostly) great, but people invest money expecting a return, and startups do not generate returns the way the stock market does. Crowdfunding as a public investment vehicle is going to hurt a lot of people.

x5n12• 11 years ago

people should know what they are getting in to. if they don't, just like the normal market, that's their problem. it would be very nice to destroy the vc market, or at least give them some more competition, and also to see some of the wealth generated returned to the people rather than back in the pocket of people who already have lots of money.

tptacek4• 11 years ago

Venture capital funds tend to underperform the market, and are subsidized by allocation requirements at their customers (pension funds, university endowments) that encourage relatively small slices of huge funds to be put into longshots and stuff that isn't correlated with lucrative investments. At least, that's what Kauffman said about it.

To generate outsized returns for a small subset of investors, you don't have to be anywhere nearly as sophisticated as a VC fund: you can just run a lottery.

If you want to do something more socially useful than a numbers racket, crowd-investing probably isn't the best way to go.

pmorici• 11 years ago

It's a lot easier to outright lie and get away with it when you have a lot of people contributing a small amount of money. Even if someone gets proof you defrauded everyone no single party has the leverage to stand up for themselves.

notahacker4• 11 years ago

And this is the prime example of the type of product that should not be crowdfunded, under any circumstance.

The model makes some sense for simple branded products which (i) aren't that appealing to VCs and (ii) have chances of success closely allied to ability to generate buzz from evangelists (though I still expect the return on the asset class to be negative when its equity funding rather than pre-orders)

The model makes no sense whatsoever for technically complex but potentially very high return inventions, where the choice of crowdfunding as a fundraising strategy is basically a big red flag saying "we think people unable to do due diligence are our best bet for [the next stage of] funding"

frozenport• 11 years ago

>for technically complex but potentially very high return inventions

Its worse! There is a good chance this is a technically complex but low return investment when compared to software startups (ie, snapchat).

neurotech1• 11 years ago

Not disagreeing with tptacek but IMHO Kickstarter style rewards with an option to purchase a complete vehicle would be preferable.

mangeletti2• 11 years ago

When I read this comment I thought, this is exactly the kind of comment that people will link to in 2021, as a "can you believe this guy" comment, just as crowdfunding (and what it evolves into) begins to replace all other forms of investing.

Everything seems like a bad idea when you first start. That's the very nature of the new idea; it's something nobody else ever thought was a good idea... or else it wouldn't be a new idea. But this doesn't matter. We, almost all of us, simply cannot break outside of a paradigm. It has to be broken for us. The few that can break their paradigm are the same folks we read about on Forbes and Fast Company.

ninkendo• 11 years ago

I dunno, crowdfunding a company's investment rounds sounds a lot like an IPO to me. But with less oversight. I can't really see how this is a good thing.

thepastisback• 11 years ago

When I read this comment I thought, how does this guy not realize that crowdfunding whole companies from unsophisticated investors isn't new, it's very old.

And in fact, the regulation we have around it is because the problems didn't disappear after starting, they grew, as fraud in such a market is incredibly easy to commit, incredibly hard to improve, and extraordinarily lucrative.

Perhaps enough has changed with improved distribution of reputation to make it work this time, but... it's not new. It's old. It's widespread. And it's a common vehicle for fraud in every time and every place that it's existed.

Thus, I find myself thinking that yours is the kind of comment that people will link to in 2021 as a "can you believe this guy" comment, about how naive it was for you to believe that this time was different.

tptacek4• 11 years ago

You can say the same thing about radium tonics.

manigandham3• 11 years ago

What is so new and special about crowdfunding? This is basically the stock market (which already gets its share of ruining amateur players who don't know enough) but taking away all the rules required to participate.

There's no oversight, no required disclosures, no stock/ownership, no liquidity, no insurance, no fallback protection, no guarantee of product, etc.

And this is supposed to replace all other forms of investing? I'm sorry but that just seems very naive.

brc• 11 years ago

Ipos are arguably just a form of crowdfunding.

Certainly back a few decades there's little difference, nowadays Ipos cannot be done without several volumes of paperwork by expensive lawyers.

If efficient IPOs were still around the crowdfunding market would be smaller. And IPOs of early stage companies certainly do not generate returns in a predictable way.

dylanjermiah4• 11 years ago

Attempting to stop bad things from happening more Often than not stops any good from being done. The magic 1 million dollar net worth requirement is no different.

ealexhudson• 11 years ago

A three-wheeler! Unfortunately in the UK this is almost certainly no-go; we've had our fill of the Sinclair / Reliant / etc.

I'm really unsure about this whole 'equity crowdfunding' thing. Risky ventures are for a certain class of investor; you need a certain amount of information too. I'm all about getting public access into these things, but you really can't evaluate it on the information presented...

mastax• 11 years ago

Two front, one back is much better than two back one front.

notahacker4• 11 years ago

That may be true, but the image problem of 3 wheelers wasn't down to any specific handling issue.

And this is an image problem in a country which pays twice as much for fuel, prefers hatchbacks to pickups, and has the original Mini as a national icon.

beatpanda• 11 years ago

One great thing about crowdfunding is that it will enable companies to raise money without having to move to the Bay Area.

notahacker4• 11 years ago

I'd prefer it if companies were not significantly disadvantaged in fundraising outside the Bay Area because VCs had some of the ability to think outside the box they are supposedly blessed with...

rory096• 11 years ago

Slightly related: does anybody know how Terrafugia's Wefunder round went?

bane3• 11 years ago

I drive an old, small car. I'm about to get in the market for a new car once this one bites the dust. In 12 years, I've put more than 2 people in my car exactly 3 times. I'm interested in reasonable price, fuel efficiency and most of all reliability.

I admit I'm a little extreme in my car buying habits, but here's what I think whenever I buy cars:

- Does this make model of car have extremely good reliability? I honestly can think of few things I hate more than servicing my car. I want it to be appliance-level reliable. My current car has been in the shop (outside of normal maintenance) maybe under 5 times...mostly as the vehicle has gotten old. How do I determine reliability? Years and years of compiled reliability surveys: Consumer Reports, True Delta, etc. I expect any car I buy to have been part of a legacy of at least 5 years of continuously high reliability. This immediately downselects and eliminates about 95% of the market.

- If it breaks, how expensive is it to fix? To return to a reliable operating condition, I don't want to have to rebalance my entire finances.

- What's the car cost to operate per mile? My current car runs around $.20-.25 per mile, fully burdened (repairs, tolls, etc.). I don't want to spend much more than that and this car could easily hit that mark if it's reliable and cheap to fix.

- Is it safe? I want top safety ratings all around. Period. I'm not going to fool with that stuff. As it turns out, makers that make reliable cars tend to also make very safe cars.

- Do I like how it looks/drives/etc? It may seem weird to lots of people that this is the last thing on my list. But I've already prevented any sort of decision paralysis by getting rid of 95+% of the market. At this point I'm down to just a handful of cars, and now I just pick the one I like. Now I know I'll at least not mind driving it, and it won't piss me off by being in the shop constantly. I don't really care much about the image I'm projecting, I'm not trying to fit into some kind of clique or club or express myself. I just want to get to work as cheaply as possible and with a minimum of hassle. I'll enjoy the clique I'm in when I retire with all the extra money I've saved not buying image cars.

Can the Elio support this? Maybe and it looks promising. I'd buy it if it met all the criteria. The price looks awesome. But I'm going to have to be patient for 4 or 5 years of general availability to see.

maaaats• 11 years ago

Could an electric bicycle be something? For commutes etc. it's cheap, single person, faster than standing still in traffic, can be exercise (or not). How safe depends on where you live.

bane3• 11 years ago

If I lived in a different area, it would absolutely be something I'd consider.

prostoalex• 11 years ago

While you fall squarely into Consumer Reports crowd (such a category exists, according to the dealer I bought a Consumer Reports top pick from), a good portion of auto industry markets to early adopters. Saturn, Scion, Tesla (with Roadster model) and even Fisker did not have much of a sales problem at their respective early stages.

bane3• 11 years ago

Lots of people, probably most of the industry, buys really exceptionally shitty cars - corinthian leather is not even a real thing, but it moved millions of haphazardly bolted together death traps for years and similar garbage-on-wheels still sells tens of thousands of units per year.

There's also quite a few small automotive companies around that haven't successfully made the transition from specialty maker to mainstream success. This goes back to the early days of the industry and carries on through today, from Tucker to the Rally Fighter.

I like to think I still represent a big part of the industry, after all somebody is buying those Consumer Reports used car guides.

ams61103• 11 years ago

You will do MUCH better spending the $6,800 on a well-maintained secondhand real car.

kevinpet• 11 years ago

You can't get a decent low mileage car for $6800. You also cannot reliably identify a well-maintained car. You can get an Accord or Camry with 150k miles or a Scion with a bit under 100k.

I bought my car for less than $5k, but I don't drive much and don't need to worry about occasional $1000 on repairs. For someone who needs reliability, buying a new, but extremely minimal $7000 car may be ideal.

If you want something you don't need to set aside money for repair on, you'll need to spend $10k+.

hammerzeit• 11 years ago

But... why? I don't understand why an entrepreneur would prefer crowdfunded money to venture capital. And if he can't raise venture capital with the glut of money in venture right now, that's doubly worrying.

The only thing that makes any sense to me at least is a marketing angle -- by getting lots of people as "shareholders" you now have a base of evangelists to advocate for your car.

burger_moon• 11 years ago

At $6800 this will make for a good transplant of a poor mans t-rex[1]. Swap in a zx14r motor and you've got yourself an animal.

[1] https://www.campagnamotors.com

skeuomorf3• 11 years ago

Hmm, so I wasn't able to find any technical information at all about the vehicle (engine specs, suspension, electronics...etc) neither on the linked page nor on their official website.

kcorbitt• 11 years ago

Unfortunately, most of the people who they're targeting for this round probably don't have the training to evaluate that type of information even if they had it. Are there any reliable third party experts who have given their opinion of the tech one way or the other? That's probably the next best thing to understanding it yourself.

skeuomorf3• 11 years ago

Exactly, I was kinda shocked at how much they've raised (via crowdfunding) given the absence of vital information.

alganet• 11 years ago

There is some info in their PDF (http://www.eliomotors.com/wp-content/uploads/2015/06/Elio_33...). Link is available on their website.

skeuomorf3• 11 years ago

Ah, this appears to have a little more information, thanks.

nawitus2• 11 years ago

84 mpg is a rather low number. Volkswagen Lupo 3L was about 78 mpg, but that was 15 years ago, and fuel efficient tech has advanced considerably in that time. And the Lupo was a normal 4-wheel car with a lot more space than the Elio. The Lupo 3L is probably slightly more safer, too.

The Elio does beat the Lupo in price, though, but $6800 is of course an estimate.

revelation• 11 years ago

It's crazy, with 84mpg this is just dead on arrival.

bagels2• 11 years ago

European mpg is not the same rating as the United States mpg mostly because a gallon is not the same size everywhere, as ridiculous as that fact is.

http://jalopnik.com/5981938/why-do-european-cars-get-better-...

Using your number of 78mpg imperial for the Lupo, this is only about 64mpg us.

nawitus2• 11 years ago

It's 78 miles per US gallon: https://en.wikipedia.org/wiki/Volkswagen_Lupo#Lupo_3L

ams61103• 11 years ago

The Lupo is not sold in the US, and this brings up something I've always wondered. Is 78 mpg calculated using imperial gallons? Because that would translate into a lower number in US gallons.

MagnumOpus• 11 years ago

The hint is in the name. The "3L" consumes 3L/100km (under optimal conditions yada yada yada). That is 78.4mpg using US gallons or 94.2mpg using UK gallons.

goatforce5• 11 years ago

I think it's a little sneaky that they only time they use to word 'car' on their materials is in a quote from a newspaper.

Technically it's a motorcycle very similar to the Spyder - http://www.brp.ca/spyder/ - and (as of 12 months ago) some states would require you to wear a helmet and/or take a motorcycle test for you to legally be able to drive this thing.

https://eliomotors.wordpress.com/2014/05/16/lets-talk-about-...

(I have no idea what progress they made on getting those laws changed in the past 12 months.)

thrownaway24243• 11 years ago

Yep, pretty much every relevant state (representing nearly the entire US population) will require you to have a motorcycle license, and to wear a helmet. That's why Elio has been vaporware for nearly a decade and why they are trying to take their investor scam mainstream. They will never get to production.

tbcj• 11 years ago

What does "every relevant state" mean? The second and third most populous states don't require a helmet over 20, and the fifth doesn't require it at all.

busterarm• 11 years ago

http://www.prnewswire.com/news-releases/elio-motors-judicial...

This plus the fact that 45+ states have already passed helmet exemptions for the Ello and other three-wheeled vehicles with non-removable roofs/windshields.

http://www.technologytell.com/in-car-tech/5760/elio-motors-m...

capex• 11 years ago

According to their website, there's no helmet needed[0] in 45 states as of now.

[0] http://www.eliomotors.com/wp-content/uploads/2014/02/helmetl...

mburns• 11 years ago

They are claiming atleast '12' states have passed laws to not classify 'autocycles'[0] as a motorcycle and thus not require an endorsement or a helmet. That includes Louisiana, where the company is headquartered.

I suspect if they get a finished product off the line the number of states that classify certain 3-wheelers as cars will go up quickly.

[0] https://www.youtube.com/watch?v=RJUXhK4pHx8&t=1212

rmason• 11 years ago

-- They will never get to production --

They said that about Elon Musk, on both Tesla and SpaceX. What do you want to bet if crowdfunding had been a valid option back then that he would have used it?

I don't think anyone on HN will disagree that transportation will look vastly different in thirty years time in ways we can't clearly project. Even Ford is now looking into manufacturing both motorcycles and bikes.

usaphp2• 11 years ago

I wonder how it will handle a crash test, for some reason I think it will be as unsafe as regular motorcycle.

So you basically getting all the downsides of a motorcycle: safety, limited space, no passengers ,wearing a helmet (some states), without getting any upsides: beating traffic by skipping between lines (I know its illegal but most of the motorcycles do this), finding a parking easier, looking cool...The only thing it shares with a car is having a roof and easier driving.

Imho it's better to get a $3K cheaper honda bike: http://powersports.honda.com/2015/rebel.aspx

obstinate3• 11 years ago

So you basically getting all the downsides of a motorcycle

Assuming your guess is correct, you capture the safety downside. But that is only a guess on your part. To me, it seems like a silly guess -- I'd expect that this will be less safe than a subcompact, but still a good deal safer than a motorcycle.

There are still a few downsides you don't get. You get AC in this vehicle. You don't have to wear leathers because you can't fall. You have a sealed cabin, so road noise, while likely worse than a normal car, will be much better than a motorcycle. A trike is a lot more stable than a bike.

without getting any upsides

Price? Fuel efficiency? Parking in such a small vehicle will be much easier than the smallest car, even if it's not quite as easy as a bike.

zevyoura• 11 years ago

beating traffic by skipping between lines (I know its illegal but most of the motorcycles do this)

This is called lanesplitting and it's not illegal in California or most of the non-US world.

usaphp2• 11 years ago

I wonder why only CA allowed lane splitting, I know that it's illegal everywhere except CA.

bagels2• 11 years ago

I don't think you'll find it very easy to low-side crash the three wheeler, whereas if you hit a slippery patch on a two wheeler it's not that hard to do. You're also probably better protected from debris.

Not sure it's the safest thing, but it's likely as another commenter mentioned, somewhere between a car and a two wheel motorcycle in terms of safety.

rokhayakebe• 11 years ago

Then make it into this: https://www.pinterest.com/pin/520939881867172271/.

toephu2• 11 years ago

This is not the car of the future. Still using gas? ICE (internal combustion engine)? 3 wheels? This has been tried before and did not work. This is a step backwards. Also who the heck names their company after themselves anymore? Talk about ego.

barney54• 11 years ago

Why is the internal combustion engine a step backwards? Electric cars have some benefits, but they have had those benefits for more than 125 years. For more than a 100 years the problem has been cost and range and that hasn't been solved yet.

Splendor• 11 years ago

As of right now 5,365 people have registered their (non-binding) interest in $21,462,675 worth of shares -- making the average reservation ~$4k.

nodesocket• 11 years ago

Interesting idea with the front/back seating, but honestly I can't image it actually drives well at all. The front with the pushed out wheels is super fugly as well.

krisweston• 11 years ago

the thing i dont like about this is the misleading way they put a picture of the earth on the car and say 'environmentally friendly!' - its not obviously, it still uses fossil fuels. shouldnt we have already got past those by now, seeing as we are all going to die if we dont ? :) yeah you can vote it down oil loving motherfucker, but you still going to die if we dont get rid of this oil shit.

PhrosTT• 11 years ago

I would be terrified of getting trapped in the backseat of that.

HeyImAlex• 11 years ago

Today, there’s a new trailblazer working tirelessly to alter the course of history. His name is Paul Elio. He is gearing up to become the next Henry Ford and this is the public’s first opportunity to invest in Elio Motors at the ground level. You can be a part of the $52 billion U.S. personal transportation industry and own a part of the next new U.S. vehicle manufacturer. But you have to act now!

That reads like an infomercial. Kind of makes you worried about crowd-investment...

jasonmcalacanis• 11 years ago

Not so fast.... these numbers are not confirmed in any way and can be gamed easily. I expand on it here.

https://www.launchticker.com/story/automotive-co-eliomotors-...

this is really bad for crowdfunding....

smitherfield• 11 years ago

Translation - no institutional investors were stupid enough to give us [any more of] their money, but we think you are!

Elio Motors is crowdfunding its entire $25M investment round

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