Zypp Electric plans to dilute a 17-18% stake to raise $25-30 Mn in its Series B round
The B2B delivery and shared mobility EV startup will launch in Bengaluru this month, while it will foray into the Mumbai market in December
The startup also plans to increase its headcount to 700 from the present 400 over the next year
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Bullish on the growth potential of escooters, electric vehicle-as-a-service startup Zypp Electric has chalked out a $30 Mn expansion plan.
The Delhi NCR-based B2B delivery and shared mobility electric vehicle (EV) startup is planning to go live in Bengaluru this month. It aims to scale further in Mumbai, Pune and Hyderabad in the coming months.
Zypp Electric aims to have a fleet of 1.5 lakh scooters spread across 18 Tier-1 cities by 2025 as part of its expansion plan.
It provides escooters for last-mile delivery to over 50 brands, including ecommerce, and food and grocery players such as Zomato, Swiggy, BigBasket, Amazon, Flipkart, Myntra, PharmEasy, Delhivery, and Spencers, among others. It has 6,000 EVs on road and helped its partners complete over 5 Mn deliveries in the financial year 2021-22 (FY22).
“To get to the top 20 cities, we would need around $25 Mn-$30 Mn of capital. We have some money in the books already, but we have now tied up around 70-75% of this additional growth capital also for this round,” Zypp Electric cofounder & CEO Akash Gupta told Inc42.
For investors to pump in $25 Mn – $30 Mn in its next funding round, the founders are roughly looking to dilute the equity of 17-18% at the Series B stage.
Zypp had earlier raised over $12 Mn from 9Unicorns, Anthill Ventures, Google for Startups, Shell E4, Northern Arc and Indian Angel Networks.
Only 10% Of The Delivery Market Is Electric Now
The growth potential in the escooter space is immense. The Delhi government’s draft aggregator policy, announced in July this year, has mandated a transition to an all-electric fleet for cab companies, food delivery firms and ecommerce entities by April 1, 2030. It has proposed a fine of INR 50,000 per vehicle if a company fails to make the transition.
According to Gupta, about 1 Lakh gig workers are currently delivering goods every day on scooters. However, out of these, only 10% of the market is electric as of now.
The top 10-15 original equipment manufacturers (OEMs) are producing about 40,000-50,000 vehicles a month, and supply is being ramped up slowly but steadily. But what matters equally, if not more, is adoption in terms of the right technology, right batteries and the right infrastructure.
“Today, out of our entire fleet, 20% is on swapping,” Gupta said, adding that the plan is to get to 100% swapping over the next year. “Demand is not a problem in this business. It is the supply that we are solving and hence there’s a huge opportunity.”
Zypp To Almost Double Its Headcount
Currently, Zypp has a workforce of 400 employees, which it aims to almost double down by September 2023. The new hiring will be mainly in the tech and operations department, primarily the young individuals, who come in from small towns to make money. The delivery executives don’t have to pay any money and can start earning via the Zypp platform.
Besides, the startup also plans to increase the number of women delivery executives.
“In fact, 4-5% of these are women and our plan is to actually make 15-20% of them women. So, when we will have 1,00,000 people, we would want 15,000- 20,000 of them women who would
More Tie-Ups With OEMs On Cards
Zypp, which already has a partnership with Hero Electric for the supply of escooters, is also in talks with a number of other OEMs.
“We are talking to Ampere, Okinawa, Jitendra, Kinetic, all of them. Out of them, the ones which perform the best and they align on our agreement terms, we will pick two more,” Gupta said.
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