Zypp Electric, an EV-as-a-service platform, raised $25 million in Series B funding led by Gogoro, a Taiwan-based battery swapping company.
The Gurugram-based startup raised the capital as a mix of equity and debt funding for fleet expansion.
The equity round of $20 million saw participation from new and existing investors, including Goodyear Ventures, 9Unicorns, WFC, Venture Catalysts, LetsVenture, IAN, IVY Growth, Grip, and other angels. The debt investment of $5 million came from global impact fund IIX along with a large national bank.
“This is in a way a big validation for the entire EV industry that if you are building the business in the right way and you are solving the right kind of problems, then money for further expansion will be made available,” said Akash Gupta, Co-founder and CEO, Zypp Electric told YourStory.
He further added, “We’ve always been so focused on profitability and solutions. Also, the good part is that this money that we raised in this funding climate, we have done this at close to over 5x of our last valuation, which is again a large validation.”
Using the funds, Zypp plans to improve its driver experience, expand its EV hub infrastructure with Gogoro battery swapping technology, build IoT- and AI-enabled EV fleet management technology, and grow its operations team by hiring across technology and top-level positions.
Founded in 2017 by Akash Gupta and Rashi Agarwal, Zypp Electric enables last-mile operations for local merchants, ecommerce giants, and delivery executives, and helps them cut delivery costs and reduce pollution on an asset-light model.
The company said it has completed 15 million electric vehicles delivery for ecommerce partners such as bigbasket, Zepto, Flipkart, Myntra, Zomato, Swiggy, Blinkit, Dunzo, Uber, Rapido, JioMart, PharmEasy, Tata 1mg, Delhivery, and Blue Dart.
In September 2021, the company raised a $7 million Series A round ($6 million in equity and the rest in debt) co-led by 9Unicorns and Anthill Ventures. With the latest fundraise, Zypp has now secured a total of $37.5 million ($30 million in equity and the rest in debt or asset leasing).
“Our bigger focus is to get the right vehicles on the ground, for which we do not use equity capital in deploying these assets,” said Akash. “So since we don’t use equity capital in deploying these assets, it’s always good to take low-cost debt or to deploy more and more fleets.”
Of the 10,000 vehicles in Zypp’s fleet, only 20% are owned by the company while the rest are on lease from finance companies.
Capital deployment
The company will utilise the funds to expand its fleet from 10,000 to 200,000 electric scooters and widen its footprint from six cities (five cities of Delhi-NCR and Bengaluru) to 30 Indian cities by December 2025.
In 2023, Akash said Zypp plans to grow to 12 cities. About 40% of these funds would go towards launching hubs in new cities, establishing teams, and configuring the operational know-how of building in a city and then deploying bikes.
About 10% will be deployed for marketing while the remaining 50% would be invested in team and technology.
“We are creating superlative EV tech involving IoT, AI, and ML—all talking to each other and then giving the right insights to the drivers, bikes and the swapping networks,” shared Akash.
Investors and partnerships
In November 2022, Gogoro and Zypp announced a strategic B2B partnership to accelerate the electric transformation of fleets and last-mile deliveries in India. Under the pilot project, they are deploying 100 battery-swapping-enabled electric scooters in Delhi-NCR and six battery-swapping stations at Zypp Electric hubs.
“Zypp Electric has taken a key leadership position in the sustainable transformation of India’s fleet and last-mile delivery industry but the opportunity is immense and with this new funding, it will be able to expand its capabilities and market impact,” Horace Luke, Founder and CEO, Gogoro said.
In 2021, the EV company also partnered with Sun Mobility for an integrated MaaS offering to deploy 10,000 vehicles. In June 2022, it partnered with Hero Electric, which will be deploying 1.5 lakh electric scooters for Zypp Electric’s fleet in the next three years.
“I would want to work with someone who is best in technology, who’s giving us the best comfort because that is what matters to achieve my goals and ambitions of deploying two lakh EVs,” shared Akash.
“Sustainable and efficient last-mile deliveries are key to addressing consumer demand across multiple verticals like prepared food, groceries and packages,” Sandeep Mahajan, Managing Director, Goodyear India said. “Our Goodyear Ventures team is focused on investing in companies with a passion to advance mobility in a sustainable way and was impressed by the commitment of the Zypp team towards making this happen in India.”
Goodyear Ventures is a business unit within Goodyear Tire and Rubber Company, focused on investing in seed-to-growth-stage startups in emerging mobility technology.
Early this month, Zypp Electric launched ZyppDash, an EV fleet management dashboard for businesses, to simplify the process of requesting and managing fleets.
