The future of shared-mobility startups such as Bounce, VOGO, Yulu and Zoomcar will depend on more users choosing self-drive options over personal vehicles, investors and founders said, making 2020 a crucial year for these entities.
A large chunk of the funding in shared mobility platforms in 2018 and 2019 were focused on Bengaluru-based two-wheeler rental startups—Bounce, VOGO, and Yulu. The firms together secured total funding worth $388 million, according to a Mint analysis. Out of this, Accel and B Capital-backed Bounce leads the pack, mopping up $250 million in the last two years.
Bengaluru was the most lucrative market for shared-mobility due to its congested roads, peak traffic woes and, importantly, users familiar with accessing products and services over the internet.
“Bengaluru has been on the forefront when it comes to shared mobility innovation, since users here are the most impacted by congestion and are tech-savvy early adopters of new models like Bounce, Vogo, Yule, etc"," Ashish Sharma, chief executive, InnoVen Capital, said in an interview. InnoVen is an investor in Bounce and several other mobility platforms.
It remains to be seen if Bengaluru’s adoption of the commute model can be emulated in other metros and tier-II cities as well. Investors and founders are hoping to change vehicle ownership into a pay-per-use model as congestion and poor road infrastructure trouble vehicle owners.
Bounce has over 3 million monthly rides and 2.8 million active users in Bengaluru alone, which is 25-30% of the city’s population, chief executive Vivekananda Hallekere said.
Ola-backed VOGO said it has completed over 90 million km across Bengaluru, Hyderabad, Mysuru, Mangaluru and Hubli since it was founded in 2016. It also counts over 3 million registered users. Chief executive Anand Ayyadurai said the startup has also initiated plans to phase out petrol vehicles and move to a fully electric fleet of two-wheelers by 2022.
Yulu, which has an electric-only fleet of two-wheelers, has completed over 20 million km since its launch in 2018. It recently raised $8 million from Bajaj Auto Ltd, and assembles its own two-wheelers in India. “The elimination of massive discounts by ride-hailing giants has made hiring an entire cab unaffordable for many. Pools and other micro-mobility options are cheaper, so preferred by a mass segment," said Amit Gupta, chief executive, Yulu, in an emailed response.
VOGO and Yulu operate on a docked station format, which allows users to pick and drop vehicles within specific parking lots in a city, while Bounce operates on a dockless format allowing users to pick up and drop scooters within city limits. However, what limits the expansion of shared mobility is the capex-heavy model, which requires startups to invest heavily in vehicle assets. “In 2018 and 2019, new mobility models were more focused around customer adoption and market creation. At that time, most mobility startups were tracking rides and adoption; but 2020 will be the year when mobility models will need to focus on monetization and tweaking pricing models, execution challenges as well as innovation in capital structuring," said Vinod Murali, managing partner, Alteria Capital.
This story has been published from a wire agency feed without modifications to the text.