How Faraday Future Went From The Brink Of Bankruptcy To Being Listed On The Nasdaq

Le-Eco founder Jia Yueting's Faraday Future for many was a Ponzi scheme that was always on the brink of going kaput. But today using a SPAC merger, it has gone public after a fresh infusion of $1 billion. Founded in 2014, it debuted a concept car in the 2016 CES while being quite bombastic about its ambitions. After burning through cash and seeing many key executives that were hired from places like Tesla, Apple and even Ferrari, flee, at the end of 2017, the company was at the brink of shutting down considering its founder was also hiding away from China where he had not paid many loans. 

In 2018, money came from Chinese real estate conglomerate Evergrande through series of offshore shell companies. It managed to get $2 billion with $800 million upfront. That's when the company was saved. Even then Jia spent that money faster than Evergrande expected and demanded Jia to give up control. He did so by handing control to Faraday Future VP Chaoying Deng, who was the daughter of his right-hand woman. This displeased Evergrande and the two parties spent months fighting over the issue in a Hong Kong court. 

Faraday Future FF91 will finally hit production next year says the company 

While all this went on, again, 1,000s of employees were furloughed and many were laid off. Most of the top management also left and including Jia's last co-founder. Eventually, Faraday Future settled with Evergrande and went into hibernation. 

After this, it started making some smart decisions including hiring a restructuring firm which helped it convince many of its suppliers whom it owed money to exchange their claims for a trust that would pay out if and when the company raise money. 

Jia Yueting is the Chinese billionaire behind Faraday Future and Leeco 

It also hired Carsten Breitfeld who used to run the BMW i8 program as its CEO. He became the face of the company for the sake of raising funds while Jia was now filing for bankruptcy stressing his $3.6 billion debt in China. Jia also placed all his control in a trust that his creditors now own pieces of. Jia had to relent control of the company. 

In 2020 it managed a $9 million load from the Paycheck Protection Program and finished the year with just $1 million in the bank. It finally managed a SPAC with Property Solution Acquisitions Corp which was completed in January 2021. Now it is listed on the Nasdaq and it says it will take another year to get its electric SUV into production.