Andrew Ragan had no idea that one day he’d be helping create the cars that he bought to the tune of $5,000–plus the repair bill. But then Ragan, 31, saw a need that Tesla, as well as two other companies Ragan invested in and drove, couldn’t fulfill. When Ragan needed a new car, Tesla offered him a car from the factory.
But the car had no option for a higher range, meaning Ragan had to buy a new model of the car, and he says Tesla’s vetting process for customers wasn’t up to par with its standard. To fix the situation, Ragan invested in the three companies, Lucid Motors, the startup that invented the technology it sold to Tesla, Supercars Design Group, which helped connect the companies and dealerships, and Fisker Automotive, which tried to sell Ragan the $100,000 vehicle he’d bought.
Ragan became “a very productive owner” of the three companies, says Daniel Godfrey, Lucid CEO and co-founder. Godfrey had begun selling Supercars earlier this year and the three companies were poised to begin trading. In April, Godfrey received an email from Ragan inquiring about buying a Lucid Crossover. In August, Ragan purchased the base model for $10,000 and plans to drive it to work. “I just realized that these startups have been growing and changing, but there is also a knowledge gap,” Ragan says. “The models of cars are changing and what is available is changing.”
When they got together, Lucid began developing an intelligent sedan and sporty crossover, the FFZero1, that will cost under $50,000. The company says it is trying to cut costs by recycling the engine that powers the Ford Focus; the final car will sell for under $50,000. In December the company plans to conduct a 1,000-car testing phase and the car is expected to be on the market by 2017. Godfrey says he has raised $25 million and developed a contract manufacturing facility that could do the job for a price that’s “substantially” less than a car company. It’s a huge motivator for Lucid.
“Budgets are tight for all of us,” Godfrey says. “By being focused on our core product, we were able to raise money a lot faster than we could have on any other path.”
The potential for Lucid’s finances, Godfrey says, is “enormous.” Ragan puts it in comparison to an automobile dealer in a three-mile radius who has five dealerships.
Closer to home, in Mysore, Rajendra Rajah has helped design several one-of-a-kind cars over the years, including the $900 million ex-Mercedes-Benz IMSA GT race car and the $600,000 Rolls-Royce Wraith, built specifically for 17 tourists for the 2014 Italian Grand Prix. Rajah, 34, lives in Byron, Florida, with his wife and two children, and in 2010 established Rajah Motors.
Rajah initially wanted to build one car and never got far, but this past summer he tried to raise money for a limited number of cars. But Rajah and his manager balked after making an equity investment in $200,000 worth of stock. In September, the funders died in a fire, leaving him with some $5 million to raise.
Rajah is still optimistic, though, and he wants to raise the money. “If I don’t sell more than 150, I’ll die of embarrassment in Florida,” he says. Rajah has found a supporter in his local police officer, who wants to have a Lucid car–as does Rajah’s 5-year-old son, who now follows him around town wearing a Lucid T-shirt and sipping water from the portable Lucid mug.
But Rajah’s prize of owning a Lucid car may come too late, because once production begins, Rajah will no longer get to sell stock. The allure of owning a Lucid car, Rajah says, is greater than cash because it’s “the first car” that he will own.