According to our Tracxn Report, funding in Electric Vehicles increased by 123% in 2015, with startups in the space raising ~$1.03B during the year, marking the sector’s highest funding volume since 2011. The funding during 2015, was predominantly focussed towards the Chinese players witnessing big ticket rounds across the year. NextEV, Gogoro, Ninebot and Niu raised $500M, $130M, $80M and $50M in their individual rounds, thus highlighting the beginning of a Chinese Domination in the space.
Our electric vehicles report covers companies focussed towards providing technology solutions for sustainable transportation and include developers and manufacturers of electric vehicles, developers of charging infrastructure and technology developers focusing on improving the components of electric vehicles. According to the report, the companies have raised more than $3.6B in cumulative funding since 2011.
Funding in Electric Vehicles Bounces back in 2015
The sector has also seen a greater number of deals in 2015, increasing to 67 from the 57 deals in 2014. Among the deals in 2015, NextEV’s funding round contributed close to 50% of the total investments, raising $500M from Sequoia Capital and Joy Capital.
With the increase in funding, there are signs of an industry bounce-back from the challenges it faced in 2012 and 2013, which witnessed the collapse of industry giants Fisker Automotive, A123 Systems, Better Place and ECOtality. Fisker Automotive and Better Place, in particular, contributed largely to the large funding volumes of 2011 and 2012, with the startups raising $548M and $300M during the period. While their collapse has reflected in the funding for 2013 and 2014, the industry has since shown resilience.
With a high amount of interest coming in from various governments, we can expect funding interest in the space to now increase. A number of countries have come up with policies and subsidies to promote electric vehicles adoption, and significant investments from the Government agencies has come in from the US Department of Energy awarding grants to a number of startups.
Stability in the Number of Companies Founded
While the number of companies founded in the space peaked in 2013 and has since been dropping, the figures have been relatively stable during the last five years.
63 companies were founded in 2013, with the number of startups focussed on the development and manufacturing of electric vehicles, especially electric cars and electric personal transport equipment increasing during the period. The attention, however, has shifted during recent times. With the focus now being towards addressing the need of charging stations and points for electric vehicle charging, it has been observed that a large number of companies which develop charging infrastructure have also been founded in recent years.
Automaker is the most funded Business Model
Currently, in terms of funding, the Electric Vehicles space has been dominated by Automakers, which manufacture electric vehicles. This can be attributed to the fact that technology development and manufacturing are highly capital-intensive segments, and hence has attracted most of the funding.
With the acceptance of Electric Vehicles increasing, the focus will now shift towards charging infrastructures which may witness the next wave of funding in the coming years. Vehicle-as-a-Service is another segment which is fast upcoming which activities in terms of companies founded, and funding beginning to take shape.
DFJ, KPCB and Sequoia are the Most Active Investors
American venture capital firm DFJ was the most active investor in electric vehicles, having invested in 5 companies, including the likes of Tesla and Mahindra Reva. Kleiner Perkins Caufield and Byers with investments in Proterra, Segway, ChargePoint and SINOEV Technologies. Sequoia Capital also features in the list with NextEV, Ninebot, ChargeDot in its portfolio.
Note: The report excludes traditional automakers such as Toyota, Renault-Nissan, General Motors, BMW, Mitsubishi, Ford, etc. which also develop electric vehicles. The conglomerates like Panasonic, LG Chem and Samsung which are leading battery manufacturers are also excluded from the scope.
Check out the Electric Vehicles Report here: