Atlis Motor Vehicles, a Mesa-based electric truck company, debuted on the Nasdaq Stock Market on Tuesday, and its shares soared.
Under ticker symbol “AMV,” the company’s shares opened at $27.50 and saw its trading halted five times as the price shot upward.
Shares closed out at $82.12, a 198% gain for the day. The shares continued to climb in early after-market trading as high as $94. Click here to follow the stock.
AMV plans to build all-electric pickup trucks designed to weather rugged work environments, plus its own electric batteries and rapid charging stations in the years to come. All of AMV’s products are still in development, and the company is aiming to build out its battery cells first.
AMV made the rare move of converting a Regulation A+ crowdfunding campaign into a public offering. This process means AMV is not raising new money by going public like a traditional IPO and is instead bringing current investors into the public market.
The company was founded in 2016 and has previously raised more than $35 million, primarily from individual retail investors during several crowdfunding campaigns. As a comparison, other EV startups — including the likes of California-based Rivian and Lucid Motors — raised billions before starting production.
Regulation A conversions differ from regular IPOs
“We are incredibly gratified to have reached this milestone in partnership with our pre-public investors, many of whom have been invested in the Company since its inception,” AMV’s founder and CEO Mark Hanchett said in a Sept. 27 statement.
“We now enter this exciting next phase of development for Atlis, in which we have achieved the milestone of becoming a publicly listed company, and now look forward to executing on an ambitious business plan to achieve revenue and profitability in an exciting and emerging market with significant opportunities to differentiate ourselves and tremendous potential to create, maintain and increase shareholder value.”
AMV did not respond to an interview request from the Business Journal.
The AMV team is expected to ring the Nasdaq opening bell on Wednesday, Sept. 28.
Regulation A conversions tend to bring in less money than traditional IPOs, according to Manhattan Street Capital. Fellow EV startup Arcimoto (Nasdaq: FUV), Chicken Soup for the Soul Entertainment (Nasdaq CSSE), KnightScope (Nasdaq: KSCP) and a handful of other companies have taken this Reg A route to the public market in recent years.
Atlis joins Wall Street trading in a bear market, with investors worried about inflation, a declining British pound and a potential recession. IPOs have slowed dramatically this year, compared to the frenzy last year, with many private companies pausing plans to go public.
AMV currently employs more than 70 people, but the company does not yet have production-ready designs for its flagship XT pickup truck, the battery packs that will power the trucks, or the property charging stations the company intends to build.
‘Significant barriers’
AMV’s vertically integrated approach of building its own vehicles, batteries and chargers is unique among EV companies, and the company faces major hurdles in bringing this vision to life.
AMV is still far from putting one of its electric trucks on the road, according to a filing with the Securities and Exchange Commission dated Sept. 21, and it needs major funding to sustain the company in the meantime.
“Uncertainty exists as to whether our business will have sufficient funds over the next 12 months, thereby making an investment in Atlis speculative,” the company wrote in the filing.
AMV reported an accumulated deficit of $147.9 million as of December 31, 2021 and ran a net loss of $133.7 million last year.
The company predicts it will need an additional $418 million over the course of four years to finalize its prototype, obtain regulatory approvals and scale production before reaching profitability. As recently as September 2021, the company had said its vehicles may be on the road in 2022.
Atlis reported having just over $3.1 million in cash at the end of 2021 in its Sept. 22 filing and less than $1 million in property, plant and equipment.
AMV has recently spent far more money on advertising — primarily to attract people to its crowdfunding campaign — than it has on developing its products. The company reported spending $1.8 million on advertising for the three months ended March 31, which was more than 2.5 times the size of its $694,000 R&D spending.
Indeed, Atlis conceded in its latest SEC filing that it faces plenty of competition.
“We face significant barriers in the development of a competitive EV in a crowded market space. Incumbents, also known as legacy manufacturers, have substantially deeper pockets, larger pools of resources, and more significant manufacturing experience,” the company wrote. “There is a chance that other competitors may release similar full-sized electric trucks before we exit the research and development phase. If several competitors release full-sized electric trucks before Atlis, it will be exceedingly difficult to penetrate the market.”