Cake Files for Bankruptcy, Joining Other Troubled eMobility Firms

Swedish electric motorcycle startup Cake has reportedly filed for bankruptcy.

Cake CEO Stefan Ytterborn did not comment on next steps, TechCruch reported Friday (Feb. 2).

The company was in the midst of a funding round when an investor’s withdrawal pushed it over the edge, according to the report. While it remains unclear if Cake filed for bankruptcy protection or insolvency, Ytterborn expressed his determination to find a solution. 

Cake gained recognition for its high-design bikes and raised $14 million in a Series A funding round in 2019, the report said. This was followed by a $60 million Series B round in 2021, which aimed to support the company’s manufacturing facilities and retail expansion plans in Europe, North America and Asia.

However, Cake has faced challenges in recent months, per the report. In November, it issued a recall for one of its mopeds due to a steering column defect. Shortly after, its flagship Kalk eMotorcycle was recalled after a unit caught fire in a South Korean dealership. These setbacks, combined with the company’s recent inability to make salary payments to employees, contributed to its struggles. 

Cake’s situation is not unique in the eMobility industry, as other companies have also faced financial difficulties, according to the report. Superpedestrian went out of business, Bird filed for bankruptcy, and Micromobility.com, formerly known as Helbiz, was delisted from the Nasdaq stock exchange.

Bird filed for bankruptcy in December, two years after going public, one year after warning bankruptcy could be on the horizon and three months after being delisted from the New York Stock Exchange (NYSE), PYMNTS reported at the time. Bird had been a high-flying electric scooter startup but encountered a downturn in the micromobility sector.

In contrast to the experiences of those companies, Vanmoof, a high-end eBike maker from the Netherlands, filed for bankruptcy protection but managed to find a buyer and resume operations, the TechCrunch report said.

Among the eMobility firms that remain, eBike manufacturers have been turning these devices into smart and multifunctional devices, PYMNTS reported Tuesday (Jan. 30). They have also adopted solutions like buy now, pay later (BNPL) options and subscription plans to help consumers enjoy rides immediately.