VanMoof, an e-bike startup once backed by venture capitalists, has reached a bleak stage in its journey since founding.
Last week, the court of Amsterdam declared bankruptcy for the company’s Dutch legal entities: VanMoof Global Holding B.V., VanMoof B.V., and VanMoof Global Support B.V.
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In an effort to keep VanMoof operational, the court has appointed two trustees to explore the possibility of selling the company’s assets to a third party.
It remains uncertain how this bankruptcy declaration will impact VanMoof’s operations in countries outside the Netherlands, such as the United States.
However, all global stores have been closed since the previous week.
The statement released by VanMoof clarified that the legal entities outside the Netherlands are not currently undergoing insolvency proceedings.
This recent development comes after a challenging period for the Dutch startup.
At the beginning of the previous week, VanMoof paused sales, initially citing technical difficulties as the reason.
Later, the company claimed the pause was intentional to address production and order fulfillment issues.
During this time, disgruntled customers took to social media to express their dissatisfaction with the quality of the bikes and after-sales support.
These complaints exacerbated the company’s struggles with dwindling cash reserves and difficulties in securing additional funding to meet financial obligations and avert insolvency.
As the week progressed, VanMoof sought an official suspension of payment provision in court to delay bill payments while restructuring its finances under the guidance of administrators.
This measure aims to stave off bankruptcy, providing creditors with a better chance of recovering owed funds and enabling VanMoof to improve its financial standing.
However, it was only a matter of days before the court deemed bankruptcy inevitable and initiated the search for a buyer for VanMoof’s assets.
The consequences of bankruptcy for customers who have yet to receive their purchased bikes or those awaiting bike servicing remain unclear.
Moreover, owners of VanMoof bikes that require repairs face uncertainty as the custom design limits who can fix them.
These circumstances are undoubtedly frustrating, especially considering the high price tags of the bikes, which can reach up to $4,000.
However, current owners of functioning VanMoof bikes may find some solace.
Rival company Cowboy wasted no time developing an app to unlock VanMoof bikes, a critical feature as the bikes can become inoperable without the proprietary VanMoof app.
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Since the app will no longer be supported, this poses a significant challenge for VanMoof and its investors.
If the unit economics of the bikes have proven unviable and it only takes a day to create an app to unlock existing bikes, potential buyers may question the desirability of assuming the assets of a failed startup like VanMoof.
