Indian electric mobility start-up Magenta Mobility has closed a $22 million Series A1 round backed by $11 million each from Morgan Stanley India Infrastructure and BP Ventures. Magenta will use the 100% equity investment to boost its existing fleet operations in logistics and last-mile delivery.
Headquartered in Navi Mumbai, the startup has a fleet of 800 three-wheel electric trucks through which it delivers goods in seven cities across the country – specifically Bengaluru, Delhi, Mumbai, Mysuru, Hyderabad, Gurugram and Noida. Magenta plans to use its latest capital injection to expand to eight new cities in the next two years, and expand its fleet to 4,000 three- and four-wheel electric vehicles in the next year. The company works with local and global OEMs to supply its fleet, including Tata Motors, Mahindra, Piago, Omega Seiki and Euler, among others.
Magenta currently has about 35 customers, including e-commerce and grocery delivery companies such as Flipkart, BigBasket, Udaan and Amazon. The startup has also started handling deliveries of food, grains and even water and mattresses as the country’s adoption of commercial electric vehicles increases. Magenta says it has made nearly 70 million deliveries across 4 million miles, 60% of which are from e-commerce.
Maxson Lewis, Magenta’s founder and general manager, declined to share details about the company’s earnings, but said the startup has grown 5x in size every year. The company has a team of 200 members located in offices in four cities.
The BP Ventures investment is more than just a financial partnership. BP provides access to its network of strategic partners, as well as a wealth of knowledge gathered from its 14 previous mobility investments and $27 million invested in India to date. Magenta Mobility is BP Ventures’ second investment in the country, after investing in electric startup BluSmart last year.
The partnership also gives Magenta access to Jio-BP, the joint venture between BP and India’s Reliance Industries, as the exclusive EV charging partner for the startup’s fleet. Jio-BP has a number of large electric vehicle charging stations and hundreds of public charging stations in various cities and major highways across the country. The startup will also be able to leverage the BP Ventures network to grow its strategic partnerships.
First mover advantage
India has become a fast-growing EV market, with 2.64 million EVs registered as of March 15, according to the government facts presented in parliament last week. Although the market is largely dominated by electric two-wheelers, the country has more than 1.39 million electric tricycles. The continued expansion of e-commerce in the country and New Delhi’s goal to reduce India’s carbon footprint at 33-35% by 2030 below 2005 levels is expected to drive demand for e-mobility among stakeholders.
“The pace of growth for electric vehicles in India, particularly in last mile delivery, is extraordinary and plays an important role in decarbonising cities. We are very proud to make BP’s first enterprise-led entry into India’s last-mile delivery market and our second into the Indian mobility sector,” said Gareth Burns, vice president of BP Ventures, in a prepared statement.
Lewis founded Magenta Mobility in February 2018 after five years in the automotive industry, 15 years in the electricity sector and years at multinationals including Bosch and Accenture. The startup initially embarked on its journey to solve the electric vehicle charging space problem as the market had yet to grow an electric mobility ecosystem.
The early move into the EV space helped Magenta Mobility gain some attention and raise seed funding from the Indian government’s Hindustan Petroleum Corporation (HPCL) after being spotted by the Prime Minister’s Office in 2018, recalls Lewis, founder and general manager of Magneta Mobility, himself in an interview.
However, now that the ecosystem has come into play with the addition of numerous new players in the market, Magenta Mobility has moved beyond just offering its charging infrastructure and started handling last-mile mobility using a fully electric fleet.
“We were always aware that we wanted to focus on last mile mobility, building this charging infrastructure as a captive service. In fact, our charging infrastructure is being used by our last-mile mobility,” said Lewis.
In its plan to build a last-mile electric delivery ecosystem, Magenta has raised a total of $33.7 million, with LetsVenture, JITO Angel Network and Indian-American philanthropist Dr. Kiran Patel as investors.
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