Last week Phoenix Motorcars revealed that they are delaying production
of their sport utility truck until at least the early part of 2008. One of the reasons mentioned for the delay was due to finalizing their financing package. Apparently they have been trying to raise some venture capital funding. There were some reports that they had a deal for a $15 million investment from Kleiner Perkins Caufield & Byers, Virgin Fuels and AES Corporation.
Kleiner Perkins is one of the biggest VC companies in Silicon Valley and Virgin Fuels is part of Richard Branson's empire. The reports of a deal were subsequently denied by an unnamed source which, if true, would explain a lot. If Phoenix is burning through cash faster than they can get new investment they may never get the chance to demonstrate if their business model can work.