Scooter rental startup, Bounce has raised $72 million in fresh funding led by Singapore-based B Capital Group and New York-based hedge fund Falcon Edge Capital, valuing the company at little over $200 million. The investment will fund the startup’s expansion out of Bengaluru into ten new cities over the coming months.
The Series C investment, which brings the total equity raised by Bounce to $92 million so far, also saw the participation from existing investors Accel Partners India, Chiratae Ventures, Omidyar Network, Sequoia Capital and Qualcomm Ventures. Accel Partners US and Mavericks Ventures also joined Bounce’s investor list in the round.
Vivekananda H R, co-founder and CEO of Bounce, said the company will expand into markets outside of the metros. “We want to go to 10 cities and will start entering these cities in a quarter’s time. We will add as many as 100,000 scooters in the next 12-18 months as our focus will be on electric scooters.”
While Bounce has raised significant equity capital, it says all of its scooters are funded by debt, raised from InnoVen Capital, Flipkart co-founder Sachin Bansal’s firm BAC and a number of banks. Going forward, Bounce wants to switch over to electric scooters and is looking at a battery-as-a-service model.
Vivekananda added that the equity would largely be put behind R&D for Internet-of-Things based innovations and to hire people to build these technologies. Bounce says it runs on a lean model of deploying scooters with no riders, allowing it to build a central command centre and monitor scooters remotely rather than using too many feet on the street.
“Bounce can help democratize access to last mile transportation with the use of technology to deliver an efficient and economical solution,” said Kabir Narang, General Partner and Co-Head of Asia at B Capital. “The company has built a transformative solution to address mobility challenges in India and other emerging markets.”
The company’s biggest rival Vogo, has raised far lesser equity at around $15 million but has received a $100 million commitment from ride-hailing giant Ola to fund the acquisition of scooters. The partnership will also bring Vogo bikes as a category on the Ola app which already has millions of users.
Vogo too is looking at adding 100,000 bikes on the roads in the next one odd year and is also testing electric bikes of several Indian as well as overseas manufacturers. But one area where the two firms differ is on how consumers pick and drop their bikes.
Bounce has opted for a dockless model where consumers can park bikes at any free public parking spots, while Vogo uses docks from where customers pick and drop bikes. While both models have advantages and disadvantages, analysts tracking the space say it’s still too early to call a winning model.