Over the last year, major steps have been made toward taking flying taxis from something many associate with the future to actually bringing them to several cities around the world.

Last week, San Jose-based Archer Aviation signed a deal to launch a series of its electric vertical-takeoff-and-landing (eVTOL) aircraft in the United Arab Emirates capital of Abu Dhabi.

In the United States, Joby Aviation  (JOBY)  is currently working to secure regulatory authorization to start running a similar air taxi from downtown Manhattan to JFK Airport in 2025. Delta  (DAL)  and Uber  (UBER)  were some of the major names to invest in the Santa Cruz-based manufacturer.

German air taxi manufacturer says it will need more funds to launch

Over in Europe, German-based startup Volocopter has also been working on a similar type of air vehicle designed for transporting smaller numbers of people. 

The company initially raised €500,000 ($520,000 USD) in a seed round back in 2011. 

With investors currently seeing significant potential in flying taxis, Volocopter spent the next decade securing numerous funding rounds including an additional $182 million from Hong Kong- and Egypt-based investors in 2022. Germany's Mercedes-Benz was also an early investor.

Chief executive Dirk Hoke said the company "successfully operated in an extremely difficult financial environment" but "despite recent intensive fundraising efforts, finding a viable solution to maintain regular operations outside of insolvency proceedings has not been possible."

On Dec. 30, Volocopter announced that it was filing for bankruptcy in German courts in order to receive the financial protection necessary to stay operational and still launch in 2025 as planned.

Volocopter files for bankruptcy, says it remains 'attractive to invest in'

The high costs around developing a new product make it a particularly tough environment even for companies that catch the attention of high-profile investors.