Scooter rental startup Bounce has been in stealth mode for over a year. While the pandemic put a speed breaker on its growth plans, the company is making a major move to enter electric scooter manufacturing. To enter the new business line, the company is all set to acquire 22 Motors.
According to two Entrackr sources, Bounce is in the last leg to acquire 22 Motors in a cash and stock deal. “The terms of the deal are almost finalised and likely to be in the range of $7-10 million,” said one of the sources requesting anonymity.
Post this, Bounce will be in a market competing with the likes of Ola Electric, Ather Energy, Hero Electric and several other scooter brands. Sources outline that 22 Motors co-founder Farhaan Shabbir along with the team [25-30 people] are set to join Bounce. Parveen Kharb and Vijay Chandrawat are 22 Motors’ other co-founders.
While Chandrawat is exiting 22 Motors, Kharb had already moved from the company to start a last-mile connectivity platform Metz Energy.
“Bounce and 22 Motors have already started working on the scooter’s design and its specifications. Bounce is aiming to roll out the first batch by the end of this fiscal [Feb-March[,” said the second source who also wished not to be identified.
Bounce was also in talks to acquire Coimbatore-based e-scooter manufacturer Booma Motors. However, the talks didn’t materialise for some unknown reasons. The Bengaluru-based company’s yellow electric scooter fleet was sourced from Booma.
Bounce has also hit the market to raise a new round but its talks with potential investors are in the early stage. “Bounce is seeking a large round by pitching itself as competition to Ola Electric,” said the above-quoted person. That pitch is tougher than it sounds, considering the gobs of funding Ola Electric has been raising and the backing of Softbank in its corner.
Bounce had raised its last equity round worth $105 million in January 2020. The Vivekananda Hallekere-led company had managed to get $6.5 million in debt funding from existing investor InnoVen Capital in March last year. It has raised around $200 million in equity and debt rounds since its inception.
Bounce and Shabbir declined to offer comment on the story.
Founded in 2016, 22 Motors had presented Flow scooters in 2019 at an auto expo but the model didn’t make it past the factory gate. In 2018, it had formed a joint venture 22 Kymco with Taiwanese two-wheeler giant KYMCO in which the latter had reportedly picked up a 25% stake in the Gurugram-based company. However, the joint venture never quite took off.
According to sources, KYMCO will get a stake in Bounce and will also help the Accel-backed firm in manufacturing electric scooters. “Bounce is also setting up a manufacturing unit in Manesar, (Haryana). 22 Motors’ team will be working from this facility,” added the person quoted at the beginning of the story.