A major problem that Indian cities currently grapple with is air pollution. Of the 15 cities worldwide with the worst air quality, 14 are in India. In these cities, air quality is not just bad but deadly. It kills 2.2 million people every year. Transportation alone accounts for about 11% of India’s total carbon emissions — a major source for air pollution — according to a 2018 World Health Organization (WHO) report.
In such a scenario, India desperately needs more and more electric vehicles (EV) on its roads. And, as Shreyas Shibulal, founder of Micelio, a venture capital company that focuses on seed-stage electric vehicle (EV) startups said —
“We believe that Indian solutions for Indian problems are what would work best.”
The Bengaluru-based VC firm has also set up an incubation centre, Micelio Studio, that will provide the much-needed infrastructure to help EV startups design the product prototype.
“Early-stage EV startups are often grappling with the transition from ideation to mass implementation,” Shibulal said.
Inc42 caught up with Shibulal to know more on his VC’s plan on bridging this gap. Here are the excerpts.
Inc42: What interests Micelio to invest in India’s EV startups?
Shreyas Shibulal: The world is moving towards an environment-driven mobility revolution. The EV space is exciting for us because it brings multiple industries into one space: mobility, software, apps, energy, charging infrastructure, environment friendliness, etc. We believe that Indian solutions for Indian problems are what would work best. There are many exciting companies already working in this space.
We have met over 30 startups over the last few months to get a pulse of the market. We think that some of them could benefit not just with a financial nudge, but also by leveraging the ‘Discovery Studio’ we are opening. So in a way, our investments are both in terms of the fund as well as the studio. The Micelio Discovery Studio will be a dedicated space in Bengaluru that can be used to experiment, discover and create India’s future Electric Mobility landscape.
Hence, Micelio has been designed to be a catalyst in the clean mobility value curve and hence will play a broader role in building the ecosystem around the EV Industry.
Inc42: What is the corpus amount of the fund Micelio has allocated as part of its investment?
Shreyas Shibulal: We have launched a 140 Cr ($19.6 Mn) fund to drive innovation, decrease entry barriers and provide an early-stage push for startups in the EV space. The fund is the first and an essential part of fuelling India’s EV ecosystem to complement investments in the initial stage (EV and subsystem) startups.
Inc42: What is the criteria for startups to become eligible for Micelio funds?
Shreyas Shibulal: We encourage all interested startups to visit and register with us on our website by submitting a business proposal. Following this, we will screen candidates through a rigorous evaluation process, critiqued by an esteemed panel of advisors to ensure that we are making the right investments.
As is India’s first seed fund-focussed solely on clean mobility, we invest in exceptional, innovative startups in the EV ecosystem. These including drivetrain technologies, charging infrastructure, energy management and special purpose electric vehicles.
Inc42: Besides investment, what are the other areas of collaboration Micelio seeks with EV startups?
Shreyas Shibulal: Micelio Discovery Studio where we combine state-of-the-art infrastructure with a robust collaborative workshop space will encourage startups to design and prototype new products. Doubling up as a fully furbished workshop, the studio will not only be open for Micelio-funded companies but for other startups as well.
We have seen that cross-fertilisation of ideas would be of enormous benefit to startups. The fact that we can bring different teams together — with experts to share their ideas and offer specific inputs, for founders to further germinate their ideas — would result in better success for all.
Inc42: What challenges do you see being faced by India’s EV startups, especially the early-stage startups?
Shreyas Shibulal: The EV space in India is certainly nascent, and with that, there is a lot of uncertainty. The opportunities to address issues of power generation and power storage demonstrate an immense potential for innovation. However, startups are often grappling with the transition from ideation to mass implementation. Building demand and meeting it through the entire ecosystem — including technology, infrastructure and vehicles — is going to be a steep journey for the foreseeable future.
There are several players that are coming to the forefront, making EV more accessible to the masses. This is where Micelio provides an opportunity for entrepreneurs in the EV space to build excellent and innovative companies.
In India’s transporttech sector, developments in the electric vehicle sector are being keenly observed. Media reports suggested earlier that even Flipkart cofounder Sachin Bansal is considering investing $50 Mn – $100 Mn in Bengaluru-based electric vehicle maker, Ather Energy.
The growth story so far has been compelling, with both national and international automotive companies entering this space. For instance, Reva (now a subsidiary of Mahindra), ION Energy, Okinawa, among others have already launched some compelling EV products.
Even India government’s push for electric vehicles continues to force the automobile manufacturers to equip their products with lithium-ion batteries. This was evident as per the orders of Sthe upreme Court and the BS 6 norms that emphasise a shift towards manufacturing more electric vehicles.