The Electrifiers: How a Group of Men Are Changing the Mobility Landscape How BluSmart is breaking the Duopoly of Ola and Uber the Electric Way
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Hailing from a business background, it was expected from Punit Goyal, the current Co-founder of Blusmart that he would continue his grandfather's business (of plastics and mats, popularly known in Indian households as chatai). But instead of joining his family business, he decided to reverse engineer not just by starting his venture but also by getting into an environment-friendly fleet, the total opposite of the plastic domain his family business was in. His first business was PLG Clean Energy, which had the initials of his grandfather's name. Today, the startup founder is all gung-ho about raising investor money and considers it the right way to do new-age business.
At his BluSmart Gurugram head office, the Co-founder ran late for our planned meeting. He rushed into the meeting room after 15 minutes and apologized for making me wait as he was caught up with an important investor meeting. As I am writing this story, came the announcement of the venture raising another round of funding, this time close to INR 200 cr. Here's a rundown on how the London School of Economics and Aston alumni is mixing his passion for economics with EV translating into a success.
"Blusmart is a born electric, fully integrated, 100% Electric, ride-hailing and charging service. And that creates this entire virtuous cycle of our business of ride-hailing and charging, intertwined with technology."
It was April 2017 when Punit started to delve into the idea of BluSmart. Punit had been a serial entrepreneur, who founded three solar companies in the past. From 2008 to 2012, he manufactured and exported solar panels to the European Union. Europe was a big market at that time for solar. India hadn't opened up its doors for setting up solar projects. And in the second avatar, he founded a company for building solar power plants. That's when he met his Co-founder, Anmol Jaggi. At that time, Anmol was building solar plants with third parties. Punit's second company, PLG Photovoltaic was building a solar power plant in Gujarat as an independent power producer/ developer, and Gensol (the company Anmol continues to run along with BluSmart, which is currently manufacturing an EV) being the EPC contractor built the solar project for them in record time. Punit ran this project for two years and sold the company for $68 million. Before that, his previous manufacturing plant also had revenues of close to about 110 million euros in the first four years of manufacturing solar panels. The third venture was again a solar power plant in Maharashtra in Dhule a 70 megawatt solar power plant, which was sold to Suzlon. After spending 10 years building solar projects, Punit was keen to invest further in the renewable and sustainable sector.
Talking about how he got the idea of BluSmart, Punit says, "In 2017 I'd gone to the US to see what next big things are happening in the world. And I learned about the EV space at that time." Interestingly, he went to the Google Campus, where he saw solar panels and a charging station charging an EV. And that's when he first got this idea, that the market opportunity could be ripe for EVs in the forthcoming years.
Sharing further he says, "I also had chanced upon a meeting at the same time with the Hyperloop people. And I had gone to meet the Hyperloop team when I saw that big tunnel under which pods go fast. I had a chance to meet with Shervin Pishevar. He was the founder of Hyperloop One with Brent Callinicos. He was the CFO of Hyperloop One, and I learned from him that in his previous avatar, he was the CFO of Uber. Brent took me to the Malibu Club diner and we were dining at the Malibu Club in Los Angeles. I came out of the dinner where I saw a ChargePoint charging station that was charging a BMW car. And that was fascinating for me, and I was like, this is the future of electric mobility."
With this as the backdrop began the journey of Punit and Anmol to build a massive EV charging infrastructure and a massive ride-hailing service built on the backdrop of technology.
From testing 10 cars in January 2019 to about 70 cars on June 19 to 300 cars on December 19, they partnered with Uber and figured out that it would call for a bigger play. They realized that somebody who wants to scale the EV ride-hailing business will also have to invest a massive amount of money in charging. Taking a cue from Starbucks and McDonald's which are real estate companies rather than just sellers of coffee and burger. In the words of Punit, "We want to build a Pret of charging or the Starbucks of charging, be at all prime locations so that people will use our services."
SCALE IS THE NAME OF THE GAME
Building further on this born electric tech stack, they are building this business, which has a key thesis on the supply side resulting in an asset-heavy model. They are not dependent on drivers to bring EVs, they depend on the upper strata to bring cars. "We institutionalize the entire supply side. In the case of BluSmart, we have raised EV asset financing from development financial institutions (DFIs), like Finance Corporation, PFC India, State Bank of India, and Axis Bank. We're getting money from large DFIs, large banks, institutionally giving us millions of dollars for buying assets and for leasing to BluSmart."
Same way for charging they are institutionalizing the entire supply side for charging. They have figured out that the biggest bottleneck in this business is charging. And that's the single largest opportunity as well because if they don't build charging infrastructure, they can't scale. With both taken care of it alleviates customer experience. Today, BluSmart is India's first and largest EV ride-hailing service and EV charging superhub infrastructure operator. BluSmart is building an integrated energy – infrastructure - mobility & technology business to decarbonize mobility at scale and build large-scale EV Charging Superhubs enabling the expansion of its electric ride-hailing service. BluSmart currently operates India's and South East Asia's largest EV full-stack ecosystem.
"At some point in 2024, you will see Blusmart completely transition into the use of renewable energy, which should be a game-changer moment. We will be the only ride-hailing company in the world operating 10,000 EVs powered by nearly 6000 charging stations, which are powered by renewable energy and at scale."
Talking about the customer insights and how it became an important pillar in resulting great service Punit says, "When we were speaking to our customers, they had largely two challenges, one - the car is very dirty, and second, the car doesn't come on time. And the car has a massive ride denial." These were the typical issues with other ride-hailing platforms shaking the duopoly of Uber and Ola. With their full-stack approach, they managed to receive a 4.9 out of the five-star rating, which they wish to maintain.
For drivers, they are creating an inclusive and equitable economic opportunity, allowing drivers to have a better quality of life without the stress of asset ownership. As per Punit, "We lease the car to a driver where we give about 30% to drivers as a fixed cost and 70% is variable for driving the car well. The driver needs to do two things right, behave with the asset well keep the car in the best condition, and behave well with the customer. And the third thing the driver needs to complete all the assigned drives which have been assigned to the driver." If the driver delivers on these three things, they get the balanced 70% amount. Recently, there was a fair work report that came out in October, where BluSmart was ranked second in India, and Ola, and Uber got a minus zero score.
For all this to come to light, technology plays a very important role. Technology tells the car where to go to pick up the customer once the car runs out of charge and the state of charge (SOC) of the car is depleted, technology routes the car to the closest charging area. So if the BluSmart car runs low on charge, the technology will route the car to the closest charging infra and take it off the ride platform.
With tracking devices in all the cars, it is easy to relay the data at all given points in time. The idea is if you truly want to decarbonize mobility and scale, you have to think it through this energy infrastructure and mobility approach at scale. Talking about the charging stations, Punit mentions, "BluSmart ride-hailing business becomes the anchor tenant to the BluSmart charging, which becomes the bedrock on which the ride-hailing business is scaling. Without the bedrock of charging the ride-hailing business does not scale. So hence the interconnectivity intertwined approach between ride-hailing and charging. And this creates a BluSmart virtuous cycle. And then BluSmart's virtuous cycle spins the web charging more cars. And this is how the business is supporting each other. And each of these business is independent. The charging infra will open to third parties soon."
"People Think Of Us As a Mobility Company, But We Are Not, We are Building an Energy Infrastructure and Mobility Company."
BluSmart operates the largest EV charging network in India spread across Delhi NCR and Bangalore, which today has powered 325 million kilometers, creating parking and charging for 5500 EVs. Recently, BluSmart launched a new platform called Assure by BluSmart, where they are now empowering or enabling large family offices to join the growth story of BluSmart. For example, if you want to invest in 100 cars or 200 car models, Assure by BluSmart allows individuals and HNI family offices to invest in cars and lease them to them if they want to join the growth story of BluSmart. Through equity financing, the business has already raised funds from the likes of Deepika Padukone, Mukesh Ambani, and Tata Motors.
When I ask why lesser cars than in the two cities, Punit avers, "I don't see too many BluSmart cars in Bangalore. So the complaint is scale more in Banglore. We'll be limited to Delhi and Banglore only and I have a reason for it. I believe that you should be in a market of relevance, and more substance. Bangalore and Delhi combined have a market opportunity of 45% of India's ride-hailing market." BluSmart aims to scale to nearly 8,000 EVs fleet size across Delhi NCR and Bangalore by next year. The company plans to take operations to three major metros soon. But will it be able to deliver the same 4.9-star rating once the scale comes, remains a ride worth taking.
THE SMART ACT
- Owns and operates over 4000 BluSmart EV Chargers
- Across 34 BluSmart EV Charging Superhubs
- Largest EV Charging superhub infrastructure spread across 1.3 Million Sq Ft
- Crossed $50 million in annual revenue run-rate Completed 10 million electric trips
- Over 330 Million Electric Kms covered Saving nearly 24,000 MT tons of CO2
- Secured EV asset financing of ~$200 million (INR 1660 crores)
- 5,500 BluSmart EVs on the Indian roads