Cake Raises $60M to Expand Electric Motorcycle Production

Cake Secures $60 Million in Series B Funding

Cake, the Swedish manufacturer of electric motorcycles, has successfully closed a $60 million Series B funding round. These funds will be allocated towards establishing manufacturing plants across Europe, North America, and Asia.

The company also intends to utilize the investment to expand its retail network and enhance its overall capabilities.

Scaling Operations and Strategic Growth

“Initiatives to scale the business are currently being implemented, with a focus on structuring a foundation for accelerated growth,” stated Stefan Ytterborn, founder and CEO of Cake.

This strategic move signifies Cake’s commitment to meeting the increasing demand for its electric motorcycles globally.

Expanding Product Platforms and Market Reach

Cake’s recent launch of the Makka, an electric moped designed for urban commuting, represents a diversification of the company’s product line.

Previously, Cake focused on the Kalk and Ösa models, which are engineered for more demanding off-road applications and utility purposes.

The introduction of the Makka has broadened Cake’s customer base, encompassing both business-to-consumer (B2C) and business-to-business (B2B) sectors, according to Ytterborn.

Enhancing Sustainability and Efficiency Through Localized Manufacturing

The establishment of new manufacturing facilities on three continents is expected to improve Cake’s sustainability profile and operational efficiency.

The company aims to facilitate direct-to-consumer vehicle shipments worldwide.

Previously, assembly was limited to Taiwan, with bikes shipped to warehouses in the U.S., Canada, and Europe, or directly to customers in Australasia.

Significant Reduction in Shipping Volume

A Cake spokesperson revealed to TechCrunch that a single shipping container from Taiwan previously accommodated 25 bikes.

Now, by shipping components to its European or North American facilities, Cake can effectively yield the equivalent of 150 bikes per container, resulting in a shipping volume reduction exceeding 80%.

Timeline for New Facilities

European assembly operations commenced in July, and the company anticipates initiating North American assembly in the first half of the coming year.

Retail Expansion Plans

Alongside manufacturing expansion, Cake will also be establishing a retail presence.

Showrooms are planned for major cities, beginning this fall, as announced by Ytterborn.

Positive Market Trends and Future Outlook

“When we started in 2016, we recognized a growing momentum in the market, but the current pace of development has surpassed our expectations, benefiting people, the planet, and our business,” Ytterborn added.

Details of the Funding Round

The funding round comprises $14 million in convertible notes and a $46 million financing round.

Swedish pension fund AMF led the latter portion of the investment.

Existing investors Creandum and Headline, who participated in Cake’s $14 million Series A round in 2019, also contributed, alongside several new investors.

Investor Confidence and Long-Term Vision

“From day one, Cake has prioritized creating an exceptional user experience, a core value that resonates strongly with us,” stated Staffan Helgesson, general partner at Creandum Advisor.

“We are pleased to continue supporting the team in their pursuit of becoming the leading brand in the premium two-wheeler electric vehicle segment.”