India’s second largest motorcycle manufacturer Bajaj Auto is in talks to invest in bicycle and low-speed electric scooter rental startup Yulu, according to Economic Times (ET). The investment will be part of the ongoing funding round that is likely to help Yulu to raise over $15-20 Mn. The Pune based auto giant is planning to invest $6-8 mn in the bicycle rental startup, sources told ET.
The funding may take place in coming weeks if Bajaj is satisfied with the ongoing due diligence, sources added. Sources further claimed that the round may lead to strategic partnership between Yulu & Bajaj and the former is also in talks to bring new investors to participate in the round.
Both companies refused to comment on the news report. Emails sent by Techpluto staff didn’t elicit any response at the time of publishing this story.
Amit Gupta incorporated Yulu in Aug 7, 2017 as a micro-mobility platform to resolve two of the most urgent problems plaguing the most urban cities – traffic congestion and air pollution. The company currently offers bicycles and low speed scooters on rent in Bangalore, Pune, Mumbai and Bhubaneswar. It has so far raised $7 Mn from several investment firms and counts high profile investors like Flipkart’s Binny Bansal and InMobi’s Naveen Tewari.
Investors are betting heavily on urban mobility space
While ride-hailing segment was already receiving heavy investments, the micro-mobility is now being greatly favored by the investor community. This is proven by the recent investment trends that have seen the likes of Ola and Hero MotoCorp chairman Pawan Munjal investing in bike taxi startups like Vogo.
In fact, Vogo and another prominent micro-mobility player Bounce raised fresh funds barely a day ago. Vogo had also raised funds from debt venture firm barely two weeks ago. Other important players in this segment like Rapido, Fae Bikes, QuickRides and Wheelstreet have also received funds from investors.
Investor’s optimism is based on the rationale that micro-mobility players like Vogo, Bounce and Yulu will spearhead the next revolution in the urban mobility space.
What is Micro-mobility?
Micro-mobility refers to transport vehicles that at the most carry one or two passengers for covering short distances in first mile and last mile connectivity. Micro-mobility vehicles usually include electric bicycles and scooters that not only help to resolve traffic woes but also address pollution problems.
Although micro mobility also includes electric cars, their mass adaptability faces problem in developing countries like India due to lack of charging stations and other infrastructural problems.