EMotorad, an Indian startup specializing in electric bikes, has successfully raised $20 million in a Series B funding round. With the aim of challenging China’s dominant position in the e-bike market, EMotorad plans to expand its presence in global markets. The latest funding round was led by Panthera Growth Partners from Singapore, with participation from Alteria Capital, xto10x Technologies, and Green Frontier Capital, the startup’s existing investor. The funding also includes a debt component worth $2.5 million.
Key Takeaway
Indian startup EMotorad has secured $20 million in funding, led by Panthera Growth Partners, to expand its manufacturing operations and increase its presence in global markets. The company aims to challenge China’s dominance in the e-bike market and offer high-quality e-bikes as an alternative to fossil fuel-powered vehicles. EMotorad plans to establish its manufacturing facility in India and aims to produce 400,000 units annually. With a focus on product quality, technology, and after-sales service, the startup aims to compete globally and achieve sales of 100,000 units by 2025.
Meeting the Growing Demand for E-bikes
As the demand for eco-friendly transportation continues to rise and people seek alternatives to fossil fuel-powered vehicles, the demand for e-bikes is surging globally. The World Bank predicts that by 2023, there will be up to 300 million e-bikes circulating in cities worldwide. However, the majority of e-bikes are currently manufactured in China. EMotorad aims to disrupt this trend by building its manufacturing operations in India.
“Almost 99% of the world procures e-bikes from China, and that is what we want to change. It’s a $40 billion industry internationally. And we are trying to make a dent in that,” said Kunal Gupta, the co-founder and CEO of EMotorad.
Expanding Presence in Global Markets
EMotorad, founded in 2020 by Kunal Gupta with Rajib Gangopadhyay, Aditya Oza, and Sumedh Battewar, initially focused on the Indian market. However, in 2021, the Pune-based startup expanded its presence to global markets. Through white labeling and selling its own-branded models, EMotorad exports e-bikes to more than 18 countries, including the United States, Europe, Australia, Japan, and certain Middle Eastern markets.
The startup currently offers a portfolio of 14 e-bike models, with 7 to 8 available in India and the remaining for global markets. The lineup is priced between $600 and $1,200 in the U.S. and between 600 and 1,500 euros in Europe. EMotorad differentiates itself by focusing on product quality, technology, and after-sales service.
“You can’t always compete on pricing. But we have a significant uptick in the quality of the product,” explained Gupta. “The batteries and the motors could not have been made smart with a software layer of technology because, of course, it was in an outsourced capacity.”
EMotorad’s dedication to service is evident in its quick response to user complaints. The company promises to resolve any issues within 48 hours of receiving a complaint and has implemented error code displays on its bikes, enabling users to easily identify problems and report them for swift resolution.
Expanding Manufacturing Operations in India
EMotorad assembles batteries, motors, and other components at its facility in Pune, which has an annual production capacity of up to 90,000 bikes. However, the startup is now constructing a new 150,000-square-foot facility that will be ready in the next three months. This new facility will feature an “in-house smart drive train” and will enable the development of all major components, including batteries, motors, displays, and chargers. It will have a capacity to produce 400,000 units per year.
In addition to its own facility, EMotorad collaborates with multiple partners across India to meet local demand. While the e-bike market in India is currently small compared to that of traditional two-wheelers, EMotorad believes it is growing steadily.
“India’s mobility on electric bicycles has been scaling immensely. There’s a very positive uptick there,” Gupta said.
The startup aims to increase its presence in India by expanding from its current 200 stores to 800 stores within the next 18 months. In 2021, EMotorad sold a total of 40,000 units worldwide, with 10,000 units sold in India. Since its inception, the company has sold a total of 80,000 units, generating nearly $36 million in revenues.
Competing Globally
EMotorad has its sights set on global competition, targeting companies like Rad Power, Lectric, and Cowboy in the U.S., Europe, and Australia. The startup aims to achieve global sales of 100,000 units by the fiscal year 2025.
“We strongly believe the market is extremely large enough for multiple players to fit in… Fortunately, in our favor, what is happening is all the Chinese brands that existed until last year are going out of business because of all the legal implications coming on these companies from international businesses primarily from Europe and the U.S.,” Gupta noted.
The startup currently has a total headcount of 160 employees globally. In the U.S., EMotorad follows a distribution-led business model, selling its products through distributors. In Australia, Japan, and the United Arab Emirates, it operates through franchisee markets. However, in Europe, the company has its own presence with warehousing and a small assembly facility located in Spain. EMotorad plans to utilize the fresh funding to expand its consumer business in Europe.
