Cake’s founder and CEO, Stefan Ytterborn, told Eltrys Tuesday that the electric motorbike firm talked to Harley-Davidson and other manufacturers in 2023 to survive.
The unreported discussions failed for the Swedish business, which went bankrupt this week. Still, Ytterborn wants to successfully navigate bankruptcy and find a partner.
“I’ve had 40 meetings in the past three days,” Ytterborn added, mostly with two-wheeler manufacturers. He added that they’re “interested in finding out if there’s a chance for us to do something” together. 
To mass-produce high-design electric bikes and mopeds, Cake secured $14 million in its Series A round in 2019, largely from venture capital. The firm received institutional funding with a $60 million Series B financing from Swedish pension fund AMF in 2021. Ytterborn said his business began raising a Series C in August 2022 and anticipated concluding with a similar combination of institutions and VCs.
By the end of the year, VCs were pulling back, making Series C closings difficult. “We had lots of interest, but no one stepped forward,” Ytterborn added. “The space collapsed.”
In late 2022 and early 2023, Cake focused on North American investors instead of European ones, according to Ytterborn. He stated that the Silicon Valley Bank crisis in spring 2023 frightened investors and destroyed whatever progress the firm made.
Cake recruited Deutsche Bank and Numis (later bought by Deutsche Bank) to market automakers like Harley-Davidson. Ytterborn said most of them were “super receptive,” and while he wouldn’t say who else Cake pitched, the firm was considering investments and strategic collaborations.
Ytterborn remembered that, with European city center limits growing, partnering with an automaker may have made sense. “They’re well aware that if they don’t expand their portfolio and bring in something that would be physically present within the urban landscape, they’ll miss out on that last-mile reality,” he added.
After failing to close a sale, Cake had to focus on “extending the runway,” which included being “spoon-fed” by the Series B round’s primary investor, a Swedish pension fund. That runway ended last week when Ytterborn claimed Cake faced the “horrifying reality” of bankruptcy.
Swedish bankruptcy is comparable to US bankruptcy; a trustee has been appointed to make Cake’s creditors whole.
But “there’s no reason to try and destroy” the firm, added Ytterborn. “Our management goal is to find a partner who will invest in [the] company and management, restructure, and continue the journey.”
That may be difficult with financing rates rising and micromobility firms closing every month. Ytterborn didn’t like Cake’s early fundraising climate, even if it was easier.
He stated, “I think that 10 years from now, we’ll be looking back at the years between 2017 and 2022 with a bit of a laugh, looking at how horrendous it turned out.” “Right now, I think we’re fighting our asses off to move forward.”
