Vecmocon, a manufacturer of electric vehicle (EV) components, has raised $5.2 million in funding from Tiger Global, Blume Ventures, and other angel investors.
The startup incubated at IIT Delhi intends to use the funds raised to invest in team building, business expansion, operational scaling, and product innovation.
Notably, this is Tiger Global’s fourth EV company investment, and its second this year, following its June investment in battery swapping business Battery Smart.
The transaction occurs at a time when venture investors are increasingly searching for acquisitions in the EV area – a sector they have mostly avoided – while the larger IT ecosystem experiences a slump, as ET reported on August 19.
Peeyush Asati, Adarshkumar B, and Shivam Wankhede formed Vecmocon in 2016, and the company estimates that by the end of the year, its products would be used in over 100,000 electric vehicles. The business, which has its headquarters in Delhi, produces parts that have software built into them that allows the car to connect to the internet.
In order to close a $6 billion fund, the New York-based investment firm Tiger has informed its sponsors (limited partners) that it will increasingly try to make early-stage bets with India as a priority.
This can constitute up to 30% of an EV’s total cost. Its products include a motor controller, vehicle intelligence module, battery management system and charger – all of which are critical in an EV. Vecmocon’s parts are already used in about 5,000 vehicles.
Peeyush Asati, co-founder and CEO of Vecmocon, said, “EV mass adoption is not a product story but an ecosystem story. Robustness, reliability, and service are at the core of this story which we are building.”
In addition, he said, “With our state-of-the-art solution, and data-centric approach, we are working with the mission to deliver a truly smart, connected, and reliable platform to the world. We plan to utilise this fundraise to invest primarily in team and tech.”
Connie Lee, Partner at Tiger Global, said, “We are impressed with the deep commitment and progress that Peeyush, Adarshkumar, and Shivam have made to solve long-term problems in India’s EV industry. We are excited to partner with them as they build a high-quality global automotive tech company to support the adoption of EVs.”