River, an Indian company making electric two-wheelers, got $40 million from Yamaha Motor to accelerate R&D and commercialize its first electric ‘SUV’ two-wheeler in India.
Current investors Al Futtaim Automotive, Lowercarbon Capital, Toyota Ventures, Trucks VC, and Maniv Mobility joined the all-equity Series B investment. This fundraising brings the startup’s total to $68 million in four phases, including the June $15 million round.
River began designing and manufacturing electric two-wheelers for Indian clients in March 2021, a growing market eager to replace diesel and gas-powered cars with EVs. Two-wheelers are South Asia’s greatest market opportunity and most competitive. According to government figures, more than 1.7 million two-wheeler EVs are on the road, or about 50% of the total sold. 
Indie, a $1,700 two-wheeled scooter that is larger than its competitors, is the startup’s hope for market share. Indie, which River calls the “SUV of scooters,” has a 14-inch wheelbase and can carry two helmets and 33 pounds of stuff. Rivals like SoftBank-led Ola Electric and Tiger Global-backed Ather Energy make 12-inch-wheeled electric two-wheelers with helmet storage.
Months of R&D at a Bengaluru facility produced this utility-style product. Since opening its first southern city retail store in October, the business has supplied around 200 devices.
However, its goals are far higher. A 120,000-square-foot plant in Bengaluru’s outskirts produces 100,000 scooters a year (9,000 each month). River aims to sell 300 scooters a month in March and 3,000 by 2024.
“By the time we are a five-year-old company in March 2026, we want to be in 100 cities and sell around 9,000 vehicles a month, which is $200 million in turnover,” River co-founder and CEO Aravind Mani said in an interview.
The firm wants to build a distributor network to handle 90% of its sales.
Mani told Eltrys the business entered into talks with dealers and wants distributors in 10 cities, including Ahmedabad, Chennai, Hyderabad, Mumbai, and Kochi.
He stated, “We are having discussions with dealers for expansion.” “We will also do more company-owned stores in strategic locations.”
Former Honda India Group head designer Mani co-founded River with CPO Vipin George. The duo has invested over $25 million in R&D and manufacturing in the first two-and-a-half years and is now scaling River’s distribution, manufacturing, and service network nationwide, strengthening its R&D, and drafting the blueprint for its next product, which Mani said would come after the startup reaches 30 cities by March 2025 and 100 cities by March 2026.
Several goods are in mind. We haven’t decided what to launch initially. Mani stated that whatever we make would be useful.
River switched to strategic investments after two rounds of financial investor funding, Mani added. Dubai’s Al Futtaim Group, a prominent Middle Eastern company and sole Toyota distributor in the UAE, made the first such investment last year. It represents 29 brands in 14 countries.
River may have access to a worldwide distribution network once it enters India. Yamaha Motor may be comparable.
With Yamaha joining, there is a strategic understanding to maybe work on product lines, but we don’t have specific agreements or how that collaboration would appear. At this point, it’s a pure-play financial investment with prospective collaboration, the co-founder said.
Despite having 450 workers, 250 of whom work in R&D, River hopes to exploit its cooperation with Yamaha Motor to boost its design and technical capabilities. Yamaha seems sold on its R&D.
“We are impressed by River’s rapid progress, especially with its design and technology focus. Hajime “Jim” Aota, Chief General Manager of the New Business Development Center at the Yamaha Motor Company, said, “We are excited about Aravind and Vipin’s conviction for River and how Yamaha can support the company to achieve this.”
Though he cited “a significant increase in valuation, multiples of 10,” Mani did not disclose the startup’s valuation since its 2021 seed round. He said that the firm has enough money for two years with the new financing.
The firm expects gross margin viability with 2,000 monthly units in 8–10 months. Co-founder: Bottom-line profitability will take longer.
