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October 4, 2024

Flying taxi startup Lilium faces insolvency if not able to "immediately" raise more capital 

The company plans to take its aircraft to market in 2026. To get there, it urgently needs funding to stay alive


Mimi Billing

2 min read

Lilium's 7-seater jet

Munich-based flying taxi startup Lilium is facing mounting liquidity issues, according to its half year report published this week. The company says that it “immediately requires additional capital to continue to finance its ongoing operations” and will be forced to cut costs, reduce operations or file for insolvency if it cannot raise fresh funding.

The stark warning comes just months after Lilium raised $114m from investors in May.

The startup, founded in Munich in 2015, has been backed by investors including Atomico, Earlybird Venture Capital and Tencent and in 2021 listed on the Nasdaq via a SPAC. 

What next for Lilium?

Lilium is developing a small aircraft that flies using electric propellors and can take off vertically — a class of vehicle known as eVTOL (electric vertical take-off and landing) — and is planning market entry in 2026.

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Image of Lilium Jet prototype plane flying

In its latest accounts, the company reported a net loss of €87m compared to €385m over the same period a year ago.

The report says that Lilium has secured commitments of around €32m from existing investors “to meet the immediate liquidity requirements.” Some of this funding, however, is “contingent upon a positive decision” from the German federal government to approve a convertible loan of €100m to the company, which would be provided in partnership with the Free State of Bavaria.

Lilium isn’t the only flying taxi startup that’s faced liquidity problems in recent times. In April, German electric air taxi startup Volocopter warned about the risk of going into insolvency if it couldn’t raise more capital. Weeks later the company managed to raise an undisclosed amount to keep operating.

On stage at Sifted Summit on Wednesday, Christian Bauer, chief financial and commercial Officer at Volocopter said that companies in this space — cash-intensive hardware companies in a pre-revenue stage — have had a few difficult years with a much smaller pot of capital to share than in 2021. 

“After the hype in 2021, where €10bn was floating into the industry, then it went down to €1bn per year. There are now a lot of companies out there raising and fighting [to survive]. So everybody in the world is now fighting for this €1bn,” he said.

Mimi Billing

Mimi Billing is Sifted's Europe editor. She covers the Nordics and healthtech, and can be found on X and LinkedIn