Bird, the Santa Monica-based e-scooter unicorn valued at $2.77 billion dollars, is listed in a database of thousands of companies that the Small Business Administration (SBA) made public Monday that received Payroll Protection Program (PPP) loans. According to the SBA, Bird received a loan of between $5 and $10 million in late April to help it retain 341 jobs, which was a month after it laid off 406 employees via Zoom.
But in a statement, Bird said it never applied for the funds and it was trying to determine why it was included on the list. "Bird was erroneously listed as a company that filed for a PPP Loan," the company said.
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A senior SBA official told dot.LA that if the lender did not cancel the loan after it was returned, the loan status may not be fully canceled and it would appear in the data. However, Bird said it never returned the loan because it never applied in the first place.
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"We did not apply for nor did we receive a PPP Loan," the company said. "We decided as a company not to file an application as we did not want to divert critical funding from small and local businesses." <br/>
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Bird's founder and CEO, Travis VanderZanden, elaborated on what happened in a tweet Monday afternoon referring to the company's lender; "It looks like Citi started an application while they waited for our decision on whether to formally apply. We discussed internally and told Citi we didn't want to apply via email on April 23rd. They confirmed that the temp app was cancelled that evening and never submitted."'
</p><div id="591a6" class="rm-shortcode" data-rm-shortcode-id="9155e9ca69c42c3fce6c3002db5c8d00"><blockquote class="twitter-tweet twitter-custom-tweet" data-twitter-tweet-id="1280223380071804930" data-partner="rebelmouse"><div style="margin:1em 0">It looks like Citi started an application while they waited for our decision on whether to formally apply. We disc… https://t.co/K0QLWt1qwx</div> — Travis VanderZanden (@Travis VanderZanden)<a href="https://twitter.com/travisv/statuses/1280223380071804930">1594064013.0</a></blockquote></div><h3>
Hyperloop and Canoo also on the list<br/>
</h3><p>
Other local companies included in the PPP database included Culver City-based Hyperloop Transportation Technologies, which received a loan in the range of $150,000 to $350,000 to retain 15 jobs and the Torrance electric maker, Canoo, which got a loan just last week of between $5-$10 million to save an undisclosed number of jobs. (dot.LA also received PPP funds of less than $150,000.)
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Canoo has raised a billion dollars in venture funding, according to Pitchbook data, and <a href="https://dot.la/a-moral-quandry-for-startups-should-they-apply-for-taxpayer-funded-aid-2645672492.html?utm_campaign=post-teaser&utm_content=fzafe4cw" target="_blank">some of have been critical of deep-pocketed venture backed startups taking money from the program. </a>
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"There is a money grab going on right now by some venture-backed startups that this program absolutely should exclude," wrote Albert Wenger, a partner at <a href="https://t.umblr.com/redirect?z=http%3A%2F%2Fwww.usv.com%2F&t=NzcxY2RiNDNhZGI2MzhjMzcwYzQxMmVlZTJkNjIyZWM2NjU3NzVhMSxUbU4zdWpESg%3D%3D&p=&m=0" target="_blank">Union Square Ventures</a> (USV), a New York-based early stage VC firm focused on investing in disruptive networks in April. "I urge everyone who is running a venture backed company with a lot of money in the bank and limited COVID-19 impact to think twice about applying for PPP."
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Companies such as <a href="https://medium.com/@sweetgreen/why-we-decided-to-return-our-ppp-loan-9ffa870d1363" target="_blank">Sweetgreen</a> and Shake Shack decided to return their loans in April after being criticized for depleting funds from a program meant to help small businesses.
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But far from running out of money the PPP program still has some $130 billion left in the bank and on July 4, <a href="https://www.forconstructionpros.com/business/news/21138083/ppp-extended-with-130b-in-funds-remaining" target="_blank">President Trump signed legislation extending the deadline to apply until August 8, 2020.</a>
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Luxury electric carmaker Karma Automotive laid off 60 people mostly from its Irvine headquarters as its repositions itself from a retail auto seller to a designer for larger vehicle makers and technology companies. That's on top of another 200 workers cut three months ago, shrinking their workforce by about 25% since October.
Many of those pink slipped are engineers, according to filings with the California Employment Development Department earlier this month.
<p>The move comes amid executive shakeups at the Chinese-owned company as the boutique carmaker has struggled to breakout. Owned by auto-supplier Wanxiang Group, the company is best known for its $135,000 Karma Revero. But, it's now billing itself as a "high-tech mobility incubator" that can manufacture, design and engineer for larger car manufactures that are sinking billions of dollars into capital for new green cars. The $95 billion electric vehicle market is expected to take off in the coming years, quadrupling by 2025.</p><p>"When the company was formed, we were formed around trying to be a mass market automotive retail company," said Karma's spokesperson Dave Barthmuss. "You need a certain kind of an engineer for that. As we move into these other areas, we need a different kind of engineering skill set."</p><p>"We need Silicon Valley entrepreneurs, an innovative mindset versus of the more traditional automotive mass market mindset," he said.</p>
<p><br/></p><p>Earlier this week, competitor Canoo announced that it struck a deal with carmaker Hyundai to design a so-called skateboard platform in which it can base its new passenger vehicle design on.<br/></p><p>Meanwhile, Karma has been restructuring its business to strike similar agreements. Earlier this year, chief executive Lance Zhou brought in several new c-suite level executives and opened up a design studio in a push to become a manufacturer and designer for other carmakers.</p><p>The move could generate a lot more than automaking, said Tyson Jominy, vice president of data and analytics consulting J.D.Power.</p><p>"It's an ugly, difficult profession," he said. "Even all the success Tesla has had, it has never made a full year's profit."</p><p>Last year, Wards Auto reported that Karma's owners had pulled back in investment. Barthmuss wouldn't comment, but said Wanxiang Group remains committed to the automaker's strategic direction.</p><p>China's car market has been dismal with sales down 8% last year, Jominy said. "There's a lot of pullback in investment as a result."</p><p>Read Karma's notice of a "mass layoff" to the California Employment Development Department here:</p><p class="pdf-loader"><a href="https://roar-assets-auto.rbl.ms/documents/6230/Karma Automotive LLC (ORA) #201900784 dated 02-07-2020.pdf" class="rm-shortcode" data-rm-shortcode-id="ce1bf1cd206775ca44eef8caf85ae1bd">Karma Automotive LLC (ORA) #201900784 dated 02-07-2020.pdf</a></p>
<img type="lazy-image" data-runner-src="https://dot.la/media-library/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMjc1MTc0MS9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTY1OTEzNzE5Mn0.6k4OTe1SfjfJUc-Tqrjhkvm-2sv8jN-N_W4L2EB4uJI/image.jpg?width=980" id="4e2d3" class="rm-shortcode" data-rm-shortcode-id="362fe92c4c8424367d5f02333ea480b6" data-rm-shortcode-name="rebelmouse-image" />
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One of the world's largest carmakers, Hyundai Motor Group, tapped Torrance-based startup Canoo to design the powertrain that will be used for their electric vehicles.
Terms of the deal were undisclosed but a similar one struck earlier this year between the Korean automaker and UK-based Arrival catapulted the startup to unicorn status. Arrival said it's now valued at 3 billion euros.
<p>Under the arrangement, the electric car maker Canoo will develop a platform similar to the one it designed for its yet-to-be-manufactured vehicle for Hyundai and Kia cars. </p><p>The so-called "skateboard design "places the components of the electric powertrain on a flatbed with wheels underneath the car much like a trailer allowing for more room inside the vehicle. Hyundai said the design will also make their electric vehicles more cost competitive. </p><p>"We were highly impressed by the speed and efficiency in which Canoo developed their innovative EV architecture, making them the perfect engineering partner for us as we transition to become a frontrunner in the future mobility industry," said Albert Biermann, Head of Research & Development, Hyundai Motor Group in a statement announcing the deal. The company is developing the a Hyundai platform that is "autonomous ready and suitable for mass adoption," he said.</p><p>Unlike traditional engines made for specific cars or trucks the skateboard allows for different car bodies to be placed atop, making it interchangeable. But the agreement does not include manufacturing of the vehicle.</p>
<p><br/></p><p>Carmakers are ramping up capital spending on electrification as more consumers warm up to the idea. BMW, Mercedes-Benz, Porsche and have announced EV models set to launch in early 2020s. Last year, Ford announced it would invest $11 billion in electric vehicles. And Hyundai has committed to spend $52 billion in future technologies through 2025, while Kia will invest $25 billion in electrification and future mobility technologies. Hyundai Motor Group wants a quarter of their car sales to come from their green fleet. </p><p>That's good news for electric vehicle startups, which often face an uphill battle because of the high cost of capital, said Asad Hussain, an analyst at Pitchbook. "You really do need corporate partners to finance your growth and expansion and if you can get an automaker on board, you can leverage the amount of capital and their technical expertise."</p><p><span></span>Canoo, founded in 2017, by two former BMW executives, opened up a waitlist last month for their eponymous prototype vehicle — a futuristic looking minivan — that it will offer to drivers as a subscription service. The service is set to launch during the second half of next year in Los Angeles.</p><p><span></span>"We have been working diligently to develop a bold new electric vehicles and partnering with a global leader like Hyundai is a validating moment for our young company," said Canoo chief executive Ulrich Kranz in a statement.</p>
<img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMjY3NDI2Ny9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYxNDc3ODU2NX0.6UpWKFCabRQtqHHQcFo4W6DvP-Ic4EY_nWe5MIJKZSc/img.jpg?width=980" id="01274" class="rm-shortcode" data-rm-shortcode-id="999883e8a6a002286fb1a28134129623" data-rm-shortcode-name="rebelmouse-image" />
Photo Courtesy of Canoo
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