 "Ather Energy: Riding the future on smart scooters")
Vijay Hegde has had to change the battery pack of his electric scooter six times in the past seven years. This is a common problem faced by users of electric scooters, as the lead acid batteries used in these two-wheelers only last two years and about 5,000 km. Indian Institute of Technology (IIT)-Madras batch mates Tarun Mehta and Swapnil Jain had this shortcoming in mind when they joined hands to build Ather Energy. The Bengaluru-based two-wheeler start-up is in its final stages of testing and integrating India's first 'smart' electric scooter, which it plans to launch by mid-2016.
The origin
When they graduated in 2012, Mehta and Jain were sure they would build a product company. Their aim was to solve a problem while building a legacy. By sheer serendipity, they stumbled upon the idea of making a battery pack design for an electric two-wheeler.
Mehta learnt although people preferred electric vehicles, they did not have a reliable option to shift from existing fossil fuel driven vehicles. The result sales of electric vehicles in India dropped 84 per cent from 100,000 in 2011-12 to 16,000 in 2014-15. "The problem was with the products. We realised we need not invent something here but to innovate," says Mehta.
He quit his job at Ashok Leyland, the truck and bus maker , and formed the company in 2013 with Jain. Ather was incubated at IIT-Madras. Within six months, it built two prototypes of e-scooters and got 25 pre-orders even before securing first seed round of funding. But when they started, the plan was to build only lithium ion battery packs. "But then it struck us that where do we put out this battery pack on, since we didn't have a vehicle on which we could assemble this," says Mehta. It was then that they decided to build scooters. Now, Ather has a plant at Whitefield in Bengaluru.
The founders' conviction has a strong backing from investors. In February 2014, they had raised about Rs 45 lakh in a funding round, which saw participation from the Centre's Technology Development Board and angel investors, followed by $1 million in seed round from the Bansals of Flipkart and Raju Venkatraman of Medall Healthcare. In May, it raised $12 million from Tiger Global. Sachin Bansal says, "I believe that Tarun and Swapnil have the right vision and approach and will be successful in giving India the next generation of impactful, technology-enabled products that will change the way we live." Ather Energy is now a 70-member team with 65 engineers.
Smart scooters
Typically, electric scooters in India run on lead batteries have a top speed of 25 km an hour, have poor acceleration and take eight hours to charge. Ather Energy looks to provide a top speed of 75 km an hour and fast-charging (below one hour) using Lithium-ion battery pack, which has 10 times longer life-span of 50,000 km. The scooter will be 20 per cent lighter than its petrol counterparts. While most electric scooters cost around Rs 35,000, Ather Energy's product will be priced in the sub Rs 1 lakh range.
"When we started, we asked people if they would buy a scooter that is costlier but gives better specifications and they were very clear they would buy this. People happily started paying us even before we really got started," says Mehta.
The company plans to use the Android platform for its dashboard - to enable Google maps using GPRS or GPS, the first in a two-wheeler, to help users navigate in cities. With mileage and engine power becoming commodities in vehicles , it is the intelligence quotient of vehicles that will be the differentiating factor for manufacturers .
So, Ather plans sensors and software that enable the e-scooters to remind users to charge the batteries or alert them about potholes on city roads, while predicting user behaviour. The company plans test drives early next year. To start with, it looks to launch the model in three cities - Bengaluru, Chennai and Delhi - through pre-orders targeted at the youth. Ather Energy eyes 1,000-2,000 pre-orders in the first phase of launch and expects volumes to pick up once the sales begin.
Future ready
India is the second largest two-wheeler market after China. According to the Society of Indian Automobile Manufacturers, 16 million units of two-wheelers were sold in India in 2014-15. However, this is less than one per cent of the total vehicle sales and can grow to five per cent in about two years.
With electric mobility already popular globally, the market is ripe for disruption in India. In addition, through the National Electric Mobility Plan 2020, the Centre targets to deploy five-to-seven million electric vehicles in the country by 2020. The current players in the Indian electric two-wheeler market include Hero Electric, EKO and BSA Motors.
"Though slow, the market is coming up. That's why we are not even worried if the company will take off. It's pretty clear it will," says a confident Mehta.
FACT BOX
Company: Ather Energy
Inception: 2013
Founders: Tarun Mehta and Swapnil Jain
Area of business: Manufacturer of electric scooters
Fund-raises: $12.5 million in two rounds
Product launch: By mid-2016
EXPERT TAKE
With the roll-out of a National Electric Mobility Plan policy, the government has laid out a strategy to support electrical mobility, not only in subsidising end-consumers but also in research and development and putting the requisite infrastructure in place. This, coupled with increased awareness of electric mobility globally, has ensured it is the right time for companies such as Ather Energy to start and build products.
Many companies in the two-wheeler space in India have been restricted to low-performance vehicles, due to the use of sub-standard components from Chinese markets. We have found a market but the fit has not been good. Companies that look to understand consumer insights and create products for the Indian consumer will have higher chances of survival.
Hence, Ather Energy's approach to look at things from the basics is a right move. The fact that they are developing a lot of core technologies from India is good because you also need to have a final differentiation in terms of intellectual property. This will also be a booster for the electric two-wheeler ecosystem in India.
Though too early to comment, getting the product right, ensuring apt technology and ensuring right distribution strategies are important for the company to be successful. While the segment looks challenging within the industry in terms of financing, it is encouraging to see Ather has managed to raise $12 million, which will enable them to give the initial push required.
The origin
When they graduated in 2012, Mehta and Jain were sure they would build a product company. Their aim was to solve a problem while building a legacy. By sheer serendipity, they stumbled upon the idea of making a battery pack design for an electric two-wheeler.
Mehta learnt although people preferred electric vehicles, they did not have a reliable option to shift from existing fossil fuel driven vehicles. The result sales of electric vehicles in India dropped 84 per cent from 100,000 in 2011-12 to 16,000 in 2014-15. "The problem was with the products. We realised we need not invent something here but to innovate," says Mehta.
He quit his job at Ashok Leyland, the truck and bus maker , and formed the company in 2013 with Jain. Ather was incubated at IIT-Madras. Within six months, it built two prototypes of e-scooters and got 25 pre-orders even before securing first seed round of funding. But when they started, the plan was to build only lithium ion battery packs. "But then it struck us that where do we put out this battery pack on, since we didn't have a vehicle on which we could assemble this," says Mehta. It was then that they decided to build scooters. Now, Ather has a plant at Whitefield in Bengaluru.
The founders' conviction has a strong backing from investors. In February 2014, they had raised about Rs 45 lakh in a funding round, which saw participation from the Centre's Technology Development Board and angel investors, followed by $1 million in seed round from the Bansals of Flipkart and Raju Venkatraman of Medall Healthcare. In May, it raised $12 million from Tiger Global. Sachin Bansal says, "I believe that Tarun and Swapnil have the right vision and approach and will be successful in giving India the next generation of impactful, technology-enabled products that will change the way we live." Ather Energy is now a 70-member team with 65 engineers.
Smart scooters
Typically, electric scooters in India run on lead batteries have a top speed of 25 km an hour, have poor acceleration and take eight hours to charge. Ather Energy looks to provide a top speed of 75 km an hour and fast-charging (below one hour) using Lithium-ion battery pack, which has 10 times longer life-span of 50,000 km. The scooter will be 20 per cent lighter than its petrol counterparts. While most electric scooters cost around Rs 35,000, Ather Energy's product will be priced in the sub Rs 1 lakh range.
"When we started, we asked people if they would buy a scooter that is costlier but gives better specifications and they were very clear they would buy this. People happily started paying us even before we really got started," says Mehta.
The company plans to use the Android platform for its dashboard - to enable Google maps using GPRS or GPS, the first in a two-wheeler, to help users navigate in cities. With mileage and engine power becoming commodities in vehicles , it is the intelligence quotient of vehicles that will be the differentiating factor for manufacturers .
So, Ather plans sensors and software that enable the e-scooters to remind users to charge the batteries or alert them about potholes on city roads, while predicting user behaviour. The company plans test drives early next year. To start with, it looks to launch the model in three cities - Bengaluru, Chennai and Delhi - through pre-orders targeted at the youth. Ather Energy eyes 1,000-2,000 pre-orders in the first phase of launch and expects volumes to pick up once the sales begin.
Future ready
India is the second largest two-wheeler market after China. According to the Society of Indian Automobile Manufacturers, 16 million units of two-wheelers were sold in India in 2014-15. However, this is less than one per cent of the total vehicle sales and can grow to five per cent in about two years.
With electric mobility already popular globally, the market is ripe for disruption in India. In addition, through the National Electric Mobility Plan 2020, the Centre targets to deploy five-to-seven million electric vehicles in the country by 2020. The current players in the Indian electric two-wheeler market include Hero Electric, EKO and BSA Motors.
"Though slow, the market is coming up. That's why we are not even worried if the company will take off. It's pretty clear it will," says a confident Mehta.
FACT BOX
Company: Ather Energy
Inception: 2013
Founders: Tarun Mehta and Swapnil Jain
Area of business: Manufacturer of electric scooters
Fund-raises: $12.5 million in two rounds
Product launch: By mid-2016
EXPERT TAKE
With the roll-out of a National Electric Mobility Plan policy, the government has laid out a strategy to support electrical mobility, not only in subsidising end-consumers but also in research and development and putting the requisite infrastructure in place. This, coupled with increased awareness of electric mobility globally, has ensured it is the right time for companies such as Ather Energy to start and build products.
Many companies in the two-wheeler space in India have been restricted to low-performance vehicles, due to the use of sub-standard components from Chinese markets. We have found a market but the fit has not been good. Companies that look to understand consumer insights and create products for the Indian consumer will have higher chances of survival.
Hence, Ather Energy's approach to look at things from the basics is a right move. The fact that they are developing a lot of core technologies from India is good because you also need to have a final differentiation in terms of intellectual property. This will also be a booster for the electric two-wheeler ecosystem in India.
Though too early to comment, getting the product right, ensuring apt technology and ensuring right distribution strategies are important for the company to be successful. While the segment looks challenging within the industry in terms of financing, it is encouraging to see Ather has managed to raise $12 million, which will enable them to give the initial push required.
Chetan Maini is founder of electric car company Reva and Board member of the National Electric Mobility Mission