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Batteries - Friday, August 14, 2009

$45M Spent, Laptop Power's Polyfuel Sputters and Dies

PolyFuel has shut down having failed to raise more funding or find a buyer. The Mountain View based startup had yet to get its product to market, despite having raised $45M from investors. Backers left holding the bag include: Mayfield Fund, Yasuda Enterprise Development, Technology Partners, Venture West Management, Intel Capital, KTB Ventures, Hotung International, CDP Capital, Chrysalis Energy, andConduit Ventures. It has been floating on the London Stock Exchange.

Polyfuel's plans was to build hydrocarbon based fuel cell membranes primarily in the US. These membranes were meant to improve in the performance of fuel cells for portable electronic and automotive applications. Its customers include consumer electronics companies that design, manufacture, and distribute consumer and industrial products.

There seems to have been seem very poor financial management at work here. a Polyfuel has just won a $2.5M grant from the U.S. Department of Energy in April. How is it possible for a small startup to blow through that so quickly?