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[MostlyBonkers]

“We thrive at the intersection of transportation, technology and energy efficiency,” said Zero Motorcycles CEO Richard Walker. Recorder Journal http://recorderjournal.com/2015/12/12/zero-motorcycles-gets-1m-in-funding-from-california/

I think the use of the word 'thrive' is intended to ameliorate concerns. It could be complete BS but I suppose that depends partly on Richard Walker's character. Anybody know him? I'd imagine he's a good person at heart. Why else would you attempt to build and run such a risky business in such a niche market? You've got to love bikes, have balls and lots of hope.

It sounds to me like a lot of effort would have gone into getting the extra financing. Not just the government grant, but also persuading existing investors to cough up more cash.

The extra money will help retain the right people, bring more in and no doubt develop the product.

I hope Zero has another couple of years or so to improve reliability, reduce prices and get some good sales going before the big boys jump in.

[modeselector]

Did anyone hear about Zero's 1 million round of funding in December? 

Not allot of money (in the scope compared to previous rounds).

Should this be a concern?

I think that could also be seen as a case of "not turning down free money"

Good point.

[Richard230]

I have met Richard Walker.  He seems like a really nice guy, more like a politician than a "whip cracker" like some Silicon Valley executives. I get the impressions that all of the big decisions at Zero are made (or at least approved and closely followed) by the company board (investors) and the company management implements their policies. I suspect not much happens at Zero without the board's approval and that upper management doesn't make the big decisions, at least with regard to things that will affect company finances and profitability. 

[MostlyBonkers]

Thanks for that insight Richard. I came across Richard's profile on their website and it's rather impressive!

[spinningmagnets]

Hello, fellas. I am fairly new here, so...be gentle. I don't see Zero being bought up. There are two historic reasons for a company to be bought out. One is that they are in an emerging industry and the smaller company has key patents and name recognition that it would take the larger company time and money to replicate (ie, Harley developed the Livewire "in house", instead of just partnering with Zero to make a Zero cruiser).

The second reason would be that the smaller company was temporarily under-valued and could be bought at a significant discount. The American system has a tax structure where if a company invests its profits into "business expenses", then it pays no tax because it "broke even". For instance, Exxon makes billions, but...it spends so much money on acquisitions and business expenses, that it pay almost no taxes. This is a perverse incentive, but... it exists.

So...is Zero undervalued, or...are their products difficult to replicate (due to patents)? By that I mean...can they be bought, and then their products marked up in price enough to justify the costs of the buy-out?

The Zero name definitely has some value right now, but...there is no "secret sauce" that can be acquired by a buyout. With enough money, anyone can design an electric motorcycle. As far as undervalued? It has been a hard grind to slowly reduce the price of the models that are available to below "early adopter" prices. There is no "low hanging fruit" for "hostile take-overs" here.

Zero has no competition right now. Alta is doing well, but their bread-and-butter is off-road. Zero is it when it comes to a street electric motorcycles.

[BrianTRice@gmail.com]

HD invested in Alta and used them for developing their electric platform.