Shared rental e-scooter startup Yulu has joined hands with top two-and three-wheeler maker Bajaj Auto to launch new models of e-scooters Miracle GR & DeX GR for retail and commercial uses, respectively.
“Together with Bajaj Auto, we are setting a new benchmark in urban mobility by ensuring affordable access to the best-in-class ride, while taking pioneering steps towards green commuting”, said Amit Gupta - Co-founder & CEO, Yulu.
Yulu is planning to deploy around 50,000 e-scooters across India mainly in Delhi, Mumbai and Bengaluru by the end of 2023 as it targets 10X growth in revenues by the end of the year.
This comes nearly six months after the e-scooter rental startup raised around $82 million in its Series B funding round led by Magna International Inc. Yulu is now looking to raise funds via debt and is in need of another $500 million in the next three years as it plans to deploy 1 million vehicles in the next 3-4 years.
“We have enough money in our banks now, we will not be raising a lot of equity capital. Most of the money we raise from now will be in debt. There are several more partnerships from different countries…We will be requiring close to $500 million to feed the growth plans,” Gupta said.
The new version will be able to carry a capacity excluding rider weight of around 35-40 kgs. While Yulu will be paying a little bit more premium for launching and maintaining this, there will be no change in customer pricing, Gupta added. The new models are compatible with the firm’s already existing charging capacity installed across cities.
The company is presently serving e-commerce and food delivery firms like Zomato, Swiggy, Amazon and Flipkart.
“There are also companies like Dominos, BlueDart and DHL who want to own the fleet and we are mulling opening up that option as well for a Business-Business-Consumer connect,” Gupta said.
Franchise model to scale up
Yulu is planning to adopt a franchise or 'business partnership model' wherein Yulu will transfer the asset and tech stack for a revenue arrangement to scale up faster and more capital-efficiently.
The company is also planning to use this model to enter smaller-tier cities.
“We were waiting for the Bajaj partnership, they have a backbone of their dealers, people who do maintenance we are far more comfortable to launch this. It will take one more quarter to launch this in smaller cities,” Gupta said
“The moment we open up for partners they will be owning the asset and we will have no cost of operations or capex…This will add to our revenues,” Gupta added.
The company will also be launching its products in other Southeast Asian markets through partnerships or franchise models in the next three to six months.
“We will not be putting our people there…this will be dealers or e-commerce players who have the passion to solve for mobility and they can set up the shop,” Gupta added.
Yulu’s hiring plans for 2023
Yulu presently has around 900 employees at the Headquarters while 1,000-1,200 employees are on the ground assisting with battery swapping, maintenance and deployments.
The company is planning to add around 2,000 staff on the ground by the mid of next year as it scales deployments across cities.
“While there may not be many hirings happening at the HQ level as we just hired 100 odd people in the last six months we will be expanding the people on the ground. We used to have 500 and are now at 1,000,” said Gupta.
Path to profitability for Yulu
The startup is planning to turn earnings before interest, taxes, depreciation, and amortization (EBITDA)positive during the calendar year 2023.
“This year we will turn Ebitda positive and we are almost operationally profitable now,” Gupta said.
60 percent of Yulu’s revenue comes from gig workers (e-commerce and food delivery personnel) and the other 40 percent of the revenue comes from retail use or ‘people mobility’.
While the company is planning to scale up within the rental and shared mobility segment in order to increase its revenue streams, Yulu is also likely to launch a low-speed e-scooter for sale in the market in 2023.
“We will soon announce the sale of e-scooters from Yulu while we continue to scale up the rental segment. This will be a big recurring revenue for Yulu…the partnership is most likely with Bajaj and it may be rolled out within the end of this year (2023),” Gupta said.
