The startup trend is at it’s all-time high currently with budding entrepreneurs coming up with excellent innovative products to make our lives easier and more beneficial. One such recently-launched company is Ather Energy – makers of electric scooters that promise to change the way urban cities commute. The automobile industry is currently at the cusp of a major technological change thanks to the development of electric vehicles. Electric vehicles will majorly shape the way people commute in the coming future. Let’s read on further to know how Ather Energy works and what is so special about it.
About Ather Energy
Indian electric vehicle manufacturers Tarun Mehta and Swapnil Jain established Ather Energy Pvt. Ltd. in 2013. They worked for General Motors and Ashok Leyland for a short while each, before they came up with the plan of starting Ather Energy. Ather 450X and Ather 450 Plus electric scooters are currently produced by this company. On July 19, 2022, the Ather 450X was released. The infrastructure for charging electric vehicles, known as Ather Grid, has also been established in 2018. As of July 2020, the company had installed over 38 fast charging stations in Bengaluru and 14 in Chennai. This burgeoning startup is one of Ola Electric’s most notable competitors.
The goal of the startup Ather Energy is to create and market high-end electric two-wheelers in India. By creating high-performance, zero-maintenance, and intelligent electric vehicles, Ather hopes to alter people’s perceptions of them.
For the purpose of providing customers with a comprehensive ownership experience, it owns and runs its own experience centers (dubbed AtherSpace). Hyderabad, Chennai, Delhi, Mumbai, Pune, Bengaluru, Kochi, Kozhikode, Kolkata, Coimbatore, and Ahmedabad are among the 11+ Indian cities where Ather 450x is currently being delivered. Ather currently has an employee strength of 500-1000.
Interesting Concept Behind the Brand Name and Logo
Every electrical circuit is unique, but the start, symbolized by the line, and the stop, symbolized by the dot, in the circuit, are the two things that never change. This was very similar to Ather’s long-term objective of creating a business that fundamentally supports executable electric energy as the answer to sustainable innovation. The tagline for Ather is as follows: “All Brain. All Power. All electric.”
Business Model
The company has an ‘online purchase’ model only and they provide doorstep delivery. They have a manufacturing unit at Whitefield, Bangalore with a production capacity of 600 units per week. Ather 450 is priced at 135000 INR and Ather 450X is priced at 138000.
Funding
The founders of Flipkart, Sachin and Binny Bansal, contributed $1 million as seed money in December 2014. A Memorandum of Understanding (MoU) was signed by Ather Energy and the Tamil Nadu government in December 2019 to establish a 400,000-square-foot manufacturing facility in Hosur for electric vehicles. Around Rs. 635 crores will be invested.
Ather Energy has raised a total of $286.8 mn in funding over 9 rounds. The latest funding of $128 mn, which came in on May 12, 2022, was led by NIIF Ltd. and Hero MotoCorp. It previously raised $56.46 mn from Hero MotoCorp on January 14, 2022. Ather Energy has also raised Rs 130 crores ($17.24M) prior to that, from Hero MotoCorp. With all this funding, Ather’s valuation is still shy of $1 bn.
The company raised Rs 84 crore from Hero MotoCorp in July 2020, which increased the auto giant’s stake in Ather to 34.58%. Hero MotoCorp currently holds over 34.8% of the stakes in Ather.
Revenue
Ather asserts that its sales increased by a staggering 800% in 2021. In India, where the company has successfully sold 3677 units, Ather Energy has been ranked as the fourth-largest-selling two-wheeler EV in the first half of 2021. Although Ather has not yet reached a $1 billion valuation, the business, which currently has 38 experience centers spread across 32 Indian cities, is growing rapidly. The company further anticipates that by 2023, there will be 150 experience centers spread across 100 Indian cities.
In FY21, Ather reported yearly revenue of Rs 79.8 crore, a significant increase from Rs 48.8 crore in FY20. In FY22, this revenue increased by an astounding 411.9% to reach Rs 408.5 crore. Sales of the company’s electric scooters account for 98% of Ather’s operating income. Ather’s total revenue in FY19 was Rs 11.7 crore. From Rs 4.2 crore in 2019 to Rs 35.3 crore in the year ended March 30, 2020, the Hero MotoCorp-backed startup’s operating revenue increased by over 8x. According to the CEO of Ather, Tarun Mehta, the company currently generates Rs 100 crore in monthly revenue and expects to double that amount in FY23.
Challenges Faced
Similar to any other startup, Ather has encountered a variety of difficulties along the way. The following are some of the main difficulties the business is facing:
- Absence of a Local Ecosystem
The absence of a local ecosystem posed the biggest problem for the business. Not only do vendors and other things fall under this category, but also talents. Because they are the sole producers and suppliers of EVs, batteries, and other accessories, they are required to test every single one of those goods. In the beginning of their journey, Ather totally missed out on these things.
- Competitors
Ather has various competitors like Ola Electric, TVS, Bajaj Auto, Okinawa Scooters, Pure EV etc. It has a long way to go if it wants to establish itself in the competitive market.
- Delivery Process
As Ather is a hardware startup, one of the biggest challenges they faced was delivery, as they could not ship a minimum viable product. If they move fast, they may break things. This was a major drawback that slowed down their delivery process. They are currently working out ways to speed up their delivery process.
- Local Sourcing
Another major challenge that Ather is facing is procuring products locally. There is a major demand for the right talents focused on designing and developing.
Awards and Accolades
- The Economic Times Start-up Awards, The Economic Times, 2016
- Most Promising Startup Impacting Automotive, IoT Next, 2016
- India Electric Mobility Technology Innovation Leadership Award, Frost & Sullivan, 2016
Future Plans
As promised, Ather will open its new 400,000-square-foot facility in Hosur, Tamil Nadu, by the end of 2022. The new factory will be able to produce up to 500,000 units and is planned to produce 100,000 units annually.
Ather Energy has suggested expanding the size of its ESOP pool. According to regulatory filings, the current Ather Energy ESOP Plan 2021 will apparently see a substantial increase of 7,808 stock options, bringing the ESOP pool size from 37,209 to 45,017 options.
Conclusion
Since electric vehicles don’t use conventional fossil fuels like gasoline, diesel, or LPG for propulsion, they adhere to the principles of sustainable development. As a result, electric vehicles significantly reduce the emissions that cause smog and climate change, halting a variety of other ecological harms and man-made environmental catastrophes in the process.
Public health and the environment are both benefitted when people choose electric vehicles for transportation. These are just a few of the many factors making electric cars a viable option.
Ather Energy is contributing its bit for the environment by building sustainable technology. Hopefully, soon the entire automobile industry will turn electric!
