Canoo

Canoo, an EV startup founded in 2017, filed for Chapter 7 bankruptcy and ceased operations in January 2025.¹²³⁴⁶ The company failed to secure funding from the U.S. Department of Energy's Loan Program Office and from foreign sources.¹³ Canoo had delivered a small number of vehicles to customers including NASA, Walmart, and the USPS before its liquidation.¹³⁶

Timeline

Money raised

Canoo went public via a SPAC merger with Hennessy Capital Acquisition Corp. IV, valuing the company at $2.4 billion.⁷⁹ The SPAC deal gave Canoo access to $600 million to help produce and launch its first commercial vehicle by 2022.⁷ In October 2023, Canoo announced an agreement to raise $45 million through a sale of convertible preferred stock to an unnamed foreign strategic institutional investor.¹⁰ The same investor could provide up to $150 million in additional investments.¹⁰ Canoo received $100 million in state incentives to build its Oklahoma production facility.⁶ In its bankruptcy filing, Canoo reported liabilities of more than $164 million against assets of $126 million.² According to the Chapter 7 filing, Canoo owed money to fewer than 49 creditors, with liabilities ranging from $10 million to $50 million, and had only $50,000 in assets.⁶ Canoo's net losses in 2023 totaled just over $300 million.³ Canoo burned over $1 billion in its short existence.⁶

Investors named in the sources: BlackRock Inc⁹, Yageo Corporation¹¹, Small Business Administration¹¹, AFV Partners¹¹.

What happened

Canoo was founded in 2017 as Evelozcity by two former BMW executives.¹⁷ In 2019, Canoo revealed the Lifestyle Vehicle, a seven-seat passenger van with a bubbly look, planned to be offered via a subscription service in 2021.¹ Canoo's design used a skateboard platform that placed electric powertrain components on a flatbed with wheels underneath.⁷ In 2020, Canoo pivoted to commercial vehicles, unveiling the MPDV (Multi-Purpose Delivery Vehicle) promised for 2022.¹ In 2020, Hyundai Motor Group announced a partnership with Canoo to use its skateboard style for future EVs, but the plans never came to fruition.¹

In August 2020, Canoo announced plans to go public via a SPAC merger with Hennessy Capital Acquisition Corp. IV, valuing the company at $2.4 billion.⁷⁹ The SPAC deal provided Canoo with access to $600 million to help produce and launch its first commercial vehicle by 2022.⁷ Canoo became a public entity on December 21, 2020, listed on Nasdaq under the ticker symbol CNOO.⁷¹⁶ In March 2021, Canoo announced it would deemphasize its engineering services business and move away from the originally promoted subscription strategy.¹⁶¹⁸ In 2022, NASA chose Canoo to supply the Lifestyle Vehicle as crew transportation for its Artemis program.¹

Walmart entered an agreement to buy 4,500 LDVs from Canoo in 2022.¹ Canoo also secured a contract from the U.S. Army in 2022 to provide a Light Tactical Vehicle for testing.¹ Canoo delivered 22 vehicles in 2023 to NASA and the state of Oklahoma.³⁶ In 2023, the SEC imposed a $1.5 million fine on Canoo for misleading investors concerning its IPO.⁶ In October 2023, Canoo announced an agreement to raise $45 million from an unnamed foreign strategic institutional investor, with potential for up to $150 million more.¹⁰

Canoo received $100 million in state incentives to build its Oklahoma production facility.⁶ In 2024, Canoo moved its headquarters from California to Texas.¹ In 2024, the United States Postal Service ordered six right-hand-drive LDVs from Canoo.¹ In November 2024, Canoo laid off almost a quarter of its staff.³ Canoo's production volumes remained low, with the handful of vehicles built over the past few years likely closer to pre-production prototypes than final production vehicles.¹

Canoo failed to secure funding from the U.S. Department of Energy's Loan Program Office.¹³ Recent discussions to acquire capital from foreign sources also failed.¹³ On January 17, 2025, Canoo filed for Chapter 7 bankruptcy in the U.S. Bankruptcy Court for Delaware.¹⁶ Canoo announced it would cease operations immediately.¹²³⁴⁶ The bankruptcy filing listed liabilities of more than $164 million against assets of $126 million.²

According to the Chapter 7 filing, Canoo owed money to fewer than 49 creditors, with liabilities ranging from $10 million to $50 million, and had only $50,000 in assets.⁶ A court-appointed trustee will supervise the liquidation of Canoo's assets and the payment of debts to creditors.¹ Canoo's bankruptcy filing includes its subsidiaries and states that it owes hundreds of creditors.¹⁷ Harbinger raised a limited objection to a proposed asset sale in the Chapter 7 bankruptcy case.¹⁵ Canoo's customers included Walmart, NASA, the U.S. Army, the USPS, Zeeba, and Kingbee.¹

The handful of Canoo vehicles built over the past few years were likely closer to pre-production prototypes than final production vehicles.¹ Canoo's test vehicles will remain the only Canoos to ever grace American roads.¹ Canoo's employees were laid off, with almost a quarter of staff cut in November 2024.³ Canoo shut down its Oklahoma facility and furloughed workers just weeks before filing for bankruptcy.⁶

Legal outcomes

• settledThe SEC imposed a $1.5 million fine on Canoo for misleading investors concerning its IPO.⁶
• chargedThe SEC charged Canoo and Kranz with misconduct related to nearly $1 million in undisclosed executive compensation.¹⁴
• filedA securities fraud class action lawsuit was filed against Canoo Holdings Ltd. on behalf of purchasers of Canoo securities between December 21, 2020 and March 29, 2021.¹⁶
• settledCanoo reached a tentative settlement to resolve investor claims that it misled the market about its engineering-services business, subscription model, and Hyundai-related commercial prospects.¹⁸
• filedHarbinger raised a limited objection to a proposed asset sale in the Chapter 7 bankruptcy case.¹⁵

Where the founders are now

Ulrich Kranz was a co-founder and CEO of Canoo.⁷ The SEC charged Canoo and Kranz with misconduct related to nearly $1 million in undisclosed executive compensation.¹⁴ Tony Aquila was Canoo's Chairman and CEO at the time of the bankruptcy.¹⁰

Sources

1. Canoo Files for Bankruptcy, Ending Its Dream of Funky EV Vans, Car and Driver, 2025-01-21
2. EV startup Canoo shuts down as it files for bankruptcy - Springfield Business Journal, Springfield Business Journal, Jan 21, 20
3. Unable to Compete with Bigger EV Players, Canoo Is Now Shutting Down, Autoweek, 2025-01-21
4. EV startup Canoo files for bankruptcy and ceases operations, finance.yahoo.com, Jan 21, 20
6. Canoo Is the Latest EV Startup To File for Bankruptcy, but It Will Not Be the Last, autoevolution, 2025-01-20
7. Electric Carmaker Canoo Set to Go Public, dot.LA, 2020-08-18
9. U.S. EV startup Canoo to go public at $2.4 billion valuation, sg.finance.yahoo.com, Aug 18, 20
10. Canoo makes deal with foreign investor, The Journal Record, 2023-10-03
11. Canoo Funding: $55M Raised, Post IPO (2023), startupfundraising.com, Aug 1, 202
14. Ulrich Kranz and Paul Balciunas, sec.gov
15. Canoo Bankruptcy Faces Insider Sale Objection, theevreport.com, Apr 1, 202
16. Canoo Inc. f/k/a Hennessy Capital Acquisition Corp. IV Securities Fraud Class Action | New Cases | Kessler Topaz, Kessler Topaz
17. EV startup Canoo files for bankruptcy in US, finance.yahoo.com, Jan 20, 20
18. 11th.com | Investor Funds Recovery, 11th.com

How this case file was put together

Every statement on this page carries a numbered note, and every note points to a court record, a regulatory filing or a named publication in the list of sources. Each statement was checked against the text of the sources it cites before it was published: a figure, a date or a name the cited source does not contain was cut rather than kept. Allegations are shown as allegations, with their status at the time of the source (filed, charged, convicted, pleaded, settled, dismissed or pending). Quoted lessons are the words of the person or publication named with them, copied from the cited source; nothing here is our own opinion of why the company failed.

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