Hyperloop One
Hyperloop One, the Los Angeles startup that's trying to turn Elon Musk's vacuum-tube train concept into a high-speed reality, is finding significant support across the U.S. to have the futuristic transit system connecting major cities. Now it has to prove the technology works in a critical test later this year -- and keep raising hundreds of millions of dollars to fund its vision.
The company trumpeted 11 proposals it's reviewing from regional transportation groups that, if built, would connect 35 states and numerous cities, Hyperloop One said at a conference in Washington DC on April 6. Route ideas submitted by Texas, Florida, Colorado, Nevada and Missouri even included state transportation department involvement. Those are in addition to 24 proposals for hyperloop projects it's received from outside the U.S.
The appeal of the concept is a form of travel or cargo transportation that's four times faster than conventional high-speed rail, but that could be built for half the cost per mile. The real thing doesn't exist yet and Nick Earle, the company's senior vice president for global operations, understands that to justify all the public enthusiasm, technology testing in the Nevada desert on Hyperloop One's just-completed 500-meter "DevLoop" must go well.
"First thing we've got to do is prove it. This is a `show me' world. We've not yet proved it, but we'll be very close to doing that" with this summer's test, Earle told Forbes. "The next challenge is raising funds, which we need. Infrastructure is an expensive business. The next big challenge will then be regulatory approval."
After a splashy coming out party with a seconds long public test of its linear motor in Nevada in May 2016 and raising $160 million for further R&D, Hyperloop One hit a rough patch last year arising from management infighting that led to the departure of former top engineer and co-founder Brogan BamBrogan. He and three other former employees sued Hyperloop One, accusing top executives of "breaching their fiduciary duty and mismanaging company resources." Hyperloop One settled the suit in November and has stayed focused on promoting the benefits of 700-mile-per-hour transportation and fundraising.
Documents obtained by Forbes last October indicated Hyperloop One aims to raise as much as $250 million this year. Earle wouldn't confirm that figure, though he said the amount will be more than $100 million, assuming the summer testing outside of Las Vegas -- which the company dubs its "Kitty Hawk" moment -- succeeds.
"We are actively raising money all the time, and we are still expecting to do a very large Series C post Kitty Hawk," he said "There is a connection between Kitty Hawk and fundraising."
That test will be of its newest linear motor and a magnetically levitated pod running inside a very long vacuum tube resembling an elevated oil pipeline, though it won't include human passengers. "It will in effect be a freight capsule, if you like. It won't be humans because we're going to do freight first," Earle said. "You need a different set of safety certifications to do with a human on board."
Following that test, the company will keep extending the Nevada test loop, eventually enlarging it to 3 kilometers and adding a prototype station. If all goes well construction of the first real hyperloop lines may begin in about three years. That’s assuming the company also secures regulatory approval and arranges private-public partnerships to pay for the multibillion-dollar systems.
“It looks like Dubai will be the first one in the Middle East, but who knows? Finland and Holland vying with each other to be the first European site. The real question is where will the first one be in North America?” Earle said. “We’ve got 11 teams here and they are coming to us. I’ve been in this industry 35 years and I’ve never seen a situation where the (local) governments are coming to us.”
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