The round also saw participation from Toyota’s start-up venture capital arm, Toyota Ventures.
“Three out of four vehicles sold in India are two-wheelers, but what’s available today has noisy, dirty, gas-powered engines from the last century,” said Sacca, who has also invested in Twitter, Uber and Instagram. . “River’s electric two-wheelers are the new benchmark for Indian riders because they’re faster, tougher and just plain cooler than anything on the market.”
With this funding, River plans to expand its team, invest in R&D, set up a manufacturing facility and have its first product ready for sale early next year, its co-founder told ET. , Aravind Mani.
The company is also in talks to raise an additional $100 million, Mani said. The next funding round will take place before the company begins selling its vehicles, he said.
Mani had founded River with Vipin George in 2020 to fill a gap in the market.
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“There is a large part of the Indian market that buys two-wheelers also for carrying a load, and that is also the reason why scooters are growing at a much faster rate than motorbikes…”, said said Mani.
River has built an electric scooter that replicates the “pickup truck culture” of the West, which means the vehicle will have plenty of cargo space.
“How do you create a product for the middle class Indian boy who is a solo entrepreneur, someone who is multitasking?” said Mani.
River has been operating in stealth for a while now and has an in-house design team that created a vehicle from scratch. “Nobody walks into a delivery segment thinking I’ll be doing this my whole life,” he said. “They won’t buy a product thinking they’ll only use it for delivery, so we’re kind of trying to see how we can create a product that can be used for multiple things.”
For now, the company is keeping the vehicle, its price and specifications a secret.
“People only see the moped as a utility vehicle. But there is no style there and no young people aspire to buy it,” Mani said. “So we try to combine utility and the individuality quotient that is able to create an all-electric vehicle and at the same time it is stylish.”
No big factories
“Right now we are in the product development stage, where we expect to have 30 to 50 vehicles on the road by September, which will enter homologation and be tested extensively, and next year you will have to start production,” says Mani.
The company wants to set up small production facilities with production capacities of around 10,000 vehicles per month. The first installation is to come in Hoskote, near Bangalore. Mani said this approach helps the business run efficiently.
“We’re reimagining the system in such a way that we don’t need such a large facility to do the manufacturing,” Mani said. “We can do this in very simple terms by controlling quality. That is why here your suppliers are very important. Your quality, your efficiency, your speed depends on the efficiency and establishment of your suppliers.”
River will outsource most of the manufacturing to suppliers, which Mani says are among the country’s top component makers. River’s quality control team will visit supplier facilities to ensure quality is maintained. The company will assemble all the components in the “micro-factories”.
“We can increase it as demand increases and you can have several across the country,” Mani said. “And it has very less fixed costs and less labor, so very easy to achieve.”
By the time the company raises its next funding, Mani said they will have several issues resolved, including testing, homologation and a production facility.
“We want to raise a much larger round, which will help us bring the product to market and increase distribution,” Mani said.
River plans to operate on a distributor model with dedicated service points.
“Two-wheeled vehicles are the backbone of mobility in India and are a huge global market, primarily because they are so easy to navigate in congested urban environments,” said Jim Adler, founding managing director of Toyota Ventures. .