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Business News/ Companies / People/  Click Moment | 'We raised debt from NBFCs on a pay-per-mile-basis'
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Click Moment | 'We raised debt from NBFCs on a pay-per-mile-basis'

In just 13 months, we have crossed 10 million rides, or more than 100,000 daily rides
  • Scooter rental models outside India have taken the approach of buying the vehicle with equity money
  • Vivekananda Hallekere, Co-founder and CEO, BouncePremium
    Vivekananda Hallekere, Co-founder and CEO, Bounce

    Bounce started operations 13 months ago as a dock-less scooter sharing company. In India, only 18% have access to personal mobility, while the rest depend on broken modes of commute. Cabs are not affordable to more than 90% of the population and public transport is either not scaled or non-existent in most cities. Therefore, there is a lot of latent demand, and Bounce has been able to scale massively. In just 13 months, we have crossed 10 million rides, or more than 100,000 daily rides. However, in a country of more than a billion people, we need millions of scooters to truly make mobility fundamental. How do we increase supply without billions of dollars in investment? India is not a demand-constrained market. To be a successful mobility player, what matters is supply and the cost of supply. Scooter rental models outside India have taken the approach of buying the vehicle with equity money. We did not want to do this as we felt this model of buying a depreciating asset using equity money is not scalable.

    We wanted a solution for millions of scooters on our platform and not just a few thousands. We believe India’s market complexity makes it more amenable with decentralization and local ownership. We had to innovate and create a symbiotic ecosystem of financiers, partners, and vendors. This is where vehicle financing as opposed to owning the asset makes it a win-win proposition for all stakeholders. One of the ways we are innovating on our financing is by raising debt from captive original equipment manufacturer non-banks on a pay-per-mile-basis.

    Mobility as a service is a natural fit for manufacturers who have seen that the next generation rely less on private vehicles and are facing a downward trend in sales. We have also been able to get debt from investors in the US and Japan at very low interest. We are now in the process of creating instruments that will help the bearer be a part of the growing Indian micro-mobility story, while the high resale value of vehicles because of their quality and a ready second-hand market will insure their investment against any risk.

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    Published: 11 Dec 2019, 10:44 PM IST
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