There’s more money racing into India’s increasingly competitive two-wheeler market after electric scooter maker Ather Energy said today it has raised $51 million in new funding.
The round was led by early backer Sachin Bansal, the co-founder of Flipkart, who invested $32 million. The rest of the money was provided by Hero MotoCorp, which added $19 million in convertible debt, and venture debt VC firm InnoVen Capital, which put in $8 million. The deal means that the six-year-old startup has raised around $90 million to date. Ather Energy was valued at about $400 million in the new round, a person familiar with the matter said.
In an interview with TechCrunch, Tarun Mehta, co-founder and CEO of Ather Energy, said the startup will use the fresh capital to expand to new cities, and ramp up its manufacturing capacity and supply chain network. Ather’s scooters, currently available only in Bengaluru, will be launched in Chennai followed by other unspecified cities, he said.
Ather Energy will also attempt to produce 20,000 to 25,000 scooters a year through its own manufacturing plant in Bengaluru, Mehta revealed. The company is also keen to expand its product portfolio, which currently numbers just two scooter models — Ather 340 (priced at $1,600) and 450 ($1,770). By 2023, the startup is aiming to grow its presence to more than 30 cities, with over 6,500 charging stations — up from 38 currently — and production capacity of a million scooters in a year.
There’s some way to go before it can reach those lofty goals, but Ather has built a fan-following in the nation for its scooters in recent years. Its scooters sport high storage battery density (2.4 KWh Lithium-ion), a dashboard for navigation information, 75 km of mileage and take less than three hours to fully charge.
That’s led Mehta to call the Ather 450 “the most powerful smart scooter in the Indian market.”
Ather Energy offers its scooters to consumers in three ways: outright purchase, purchase with a subscription for value-added features and leasing, an option it only recently introduced.
The company’s competitors include Vogo, Bounce and Yulu, which earlier this month inked a deal with Uber to conduct a trial in the nation. Another big name is also involved: Uber rival Ola has invested about $100 million in startup Vogo, which operates in Bengaluru and Hyderabad.
Mehta said he thinks electric scooters are a good fit for ride-hailing giants, and that’s something he is open to exploring at a later stage. But for now, his startup will stick to its B2C (business to consumer) play.
In a prepared statement, Sachin Bansal, who has emerged as one of the most prolific VCs in India, said, “Their [Ather Energy’s] focus on end to end customer experience will open up new revenue opportunities and accelerate the adoption of electric vehicles in India. The future is electric and I am excited to be a part of this journey in shaping the future.”