River, an Indian EV startup that introduced its first two-wheeler in February, has raised $15 million in a funding round led by Dubai’s Al Futtaim Group. With today’s funding round, the startup looks to take on the likes of SoftBank- and Edelweiss-backed Ola Electric, and Ather Energy, which counts Tiger Global, Caladium Investment and Hero MotoCorp among its key investors.
The all-equity funding round also saw participation from River’s existing investors Lowercarbon Capital, Toyota Ventures, Maniv Mobility and Trucks VC. With the latest capital infusion, the startup has raised $28 million in total, including an $11 million Series A round announced in July last year and a $2 million seed round in March 2021.
Founded in March 2021 by Aravind Mani and Vipin George, River wants to offer a standout design and innovative technology through its electric scooters. Its first product, the Indie, is the result of 20 months of research and development. The vehicle, which is an electric two-wheeler, has covered over 100,000 kilometers in testing.
Unlike existing EV scooters from Ola Electric and Ather Energy, River’s Indie features 14-inch wheels instead of 12-inch wheels. The dual-tone scooter also includes crash guards and front-foot pegs to provide safety and comfort. It also features a 12-liter lockable glove box with a USB charger and 43-liter under-seat storage.
George, who previously worked as a group head designer at Honda in India, used his experience to make Indie look unique in the segment. This scooter is designed for solo entrepreneurs and households looking for a two-wheeler to carry goods for their shop or office. Additionally, it has a dual-tone finish to appeal to young commuters looking for a newly designed electric two-wheeler.
The Bengaluru-based startup started taking pre-orders for the Indie scooter following its launch this year. Without disclosing the pre-order numbers, Mani told ProWellTech that the startup aims to sell 2,000 to 3,000 units by the end of the year. By the end of 2024, the company hopes it will sell 5,000 scooters a month.
River has a 120,000 square-foot facility on the outskirts of Bengaluru, with an annual production capacity of 100,000 scooters. Based on the company’s targets, it will utilize 60% of that capacity by the end of 2024, Mani said.
The founder said the two-year-old startup looks to augment its R&D and go-to-market operations through the fresh funds. Moreover, when it comes to geographic expansion, it plans to be in three Indian cities — beginning with Bengaluru — by the end of the year and reach 50 cities across the country by the end of 2024.
“We evaluated over 50 electric two-wheeler startups, and are impressed by the team’s vision and relentless commitment to in-house product development. I am confident that their products will see great success, in India and internationally,” said Paul Willis, President of Al Futtaim Automotive, in a prepared statement.
The Indian government subsidizes locally manufactured electric two-wheelers under its FAME-II policy. However, New Delhi recently revised its subsidies after seeing some manufacturers abusing the policy. They said that some imported components were locally sourced and provided misleading information about their scooters. As a result, EV manufacturers, including River, have to raise the pricing of their vehicles.
Mani did not reveal the exact change but confirmed the price increase to ProWellTech. The two-wheeler is currently available for pre-orders with a starting price of around $1,500 (125,000 Indian rupees).
The Indie two-wheeler will be available starting this August through the startup’s own stores as well as third-party dealers. The startup will also have after-sales services through various channels.
“River is our first investment in India, and we’re excited to see the unique value proposition and capabilities of Indie. We’re amazed at River’s progress and look forward to seeing them continue to execute on their vision of delivering quality, durable, affordable, and stylish all-electric two-wheeled vehicles,” said Jim Adler, founder and general partner of Toyota Ventures.
India’s EV market is primarily dominated by two-wheelers, with 2,31,000 EV scooters sold between 2021 and 2022 according to recent government data shared in the parliament. International players, such as Taiwan’s Gogoro, are also working with Indian entities to expand EV two-wheeler infrastructure in the country.