Fast Ion Battery Harvard Case Solution & Analysis

A battery company is running out of cash and has not satisfied all of its milestones. The year is 2012 and many cleantech investors decided to pull back. Fast Ion Battery needs a $5 million bridge round, but one of its three investors has refused to continue funding the business.  A partner of Ware Street Capital, John Davidson and also the lead investor in Fast Ion, must choose whether to save the company.

The partner John Davidson at Ware Street Capital (WSC) along with a board member at Fast Ion Battery, had just received a phone call from Don Lerner at Bluelock Ventures telling him that Bluelock would not participate in the $ 5 Bridge financing for the Fast Ion Battery. Lerner’s call could have come at an adverse time. Fast Ion desired another round of financing urgently to continue developing its ground-breaking battery and was running out of cash. Davidson confronted a real predicament. On the one hand, the company was ultimately gaining traction with developing its technology and the search to replace the current CEO had yielded two prospective nominees who were extremely well-suited to drive the company forward with a more capital efficient business model.

Ware Street Capital, on the other hand and the two other investors had already invested $10 million into a business that had not performed up to investors' expectations. Would investors be throwing more good money after bad by providing the bridge financing? Also, would other , later phase, investors be willing to provide the substantial amounts of capital required to get the company to an exit occasion given the altering climate for the clean tech endeavors? These questions are turning out to be more pressing following Lerner’s call of discontinuation of support to Fast Ion by Bluelock.

PUBLICATION DATE: September 02, 2014 PRODUCT #: 815025-PDF-ENG

This is just an excerpt. This case is about INNOVATION & ENTREPRENEURSHIP

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