Uniti is on the verge of bankruptcy

The pandemic has also taken its toll on Uniti: The next planned financing round was delayed, and the team, which has not received a salary for a long time, was reduced to an absolute minimum. There were negotiations with a strategic investor from China, who was supposed to provide bridge financing by November 30. However, since this was delayed, Uniti now has to raise 500,000 euros in less than a week – otherwise, they would have to file for bankruptcy.

An investor from China demanded exclusivity - but then did not transfer as planned

The pandemic already affected Uniti in 2020: An engineering partner had ordered body parts from a company located in Wuhan – where a temporary exclusion zone was created in 2020. The tight budget left no alternatives at that time. Consequently, the assembly of the first prototypes to pre-series standard stretched into the second quarter of 2020. In parallel, Uniti was looking for partners for production, which was actually supposed to take place in the UK – a big problem for Uniti as well. Because when the near-series prototype was finished at the beginning of 2021, it was first presented only to the shareholders, but not to the public. According to Horne, this was the wish of a "strategically valuable partner" who wanted to solve not only the needed capital but also the "production challenges." Since May 2021, they have focused on this unnamed investor and adhered to an "exclusivity agreement." And have refrained from raising additional funds from other investors.

But now the first financing, promised for the end of November, has not been transferred – according to Horne, due to "restrictions on capital outflows from China." The investor can waive the exclusivity clause so that they can raise capital from other sources and gain enough time to close the deal, Horne further explains, and he concludes frustrated:

"My hope was that I would be able to tell the public today that we finally have good news. Instead, we are struggling to continue without these funds."

Horne makes a concrete offer to new potential investors: Uniti needs 675,000 euros as bridge financing. Additionally, four million euros for the first demo vehicles and 60 million euros for a Uniti factory in China, as well as further funds for operations and marketing from the investor's internal budget are required. A subsequent IPO is to be sought within 12 months. This seems to put the option of building the car developed in the UK there off the table. In the UK, they wanted to start at prices from 17,760 euros gross.

Horne has never believed that this journey would be easy: "We only know that it would benefit the world if the trend towards light, resource-efficient, digitally oriented, and shared electric cars were to materialize."

And he too had hoped to be successful. Instead, the last few years have been “a story of survival and perseverance” in the face of constant setbacks. He concludes:

“Regardless of the outcome, I am proud that my extraordinary team fought every day to realize this dream.”

What does this mean?

With Uniti, the next promising start-up in the micro-car segment is collapsing. With the special seating arrangement (driver in the middle plus two passengers), the Swedes would have offered an interesting premium alternative in the micro-segment – optionally with up to 300 kilometers range. All the more regrettable now that the switch to China is backfiring on the team.