UBCO Raises $10 Million for Global Expansion | Electric Utility Bikes

Ubco Secures $10 Million for Global Expansion

The New Zealand-based electric utility bike company, Ubco, has successfully raised $10 million in funding. This capital injection will be utilized to facilitate a global expansion, with a primary focus on penetrating the U.S. market. Furthermore, the funds will support the scaling of Ubco’s commercial subscription service offerings.

The Ubco 2X2: A Unique Electric Vehicle

Ubco’s flagship product, the Ubco 2X2, is a distinctive all-wheel drive electric motorbike. While visually resembling a dirt bike, its riding experience is more akin to that of a moped. Initially conceived as a practical solution for farmers needing efficient and safe transport across their land, the bike’s application has broadened.

The company now offers an urban-focused version designed to serve fleet enterprise customers, gig economy participants, and everyday city commuters.

Product Evolution and Current Offerings

Since its inception in 2015, Ubco has developed two distinct iterations of its 145-pound utility bike. These include the Work Bike, the original model tailored for off-road use, and the Adventure Bike, a newer version engineered for urban environments while retaining off-road capabilities.

Expansion into Key Verticals

Following this new investment, led by Seven Peak Ventures, Nuance Capital, and TPK Holdings, Ubco intends to further expand its presence in existing sectors. These include food delivery services, postal operations, and last-mile logistics solutions.

The company currently collaborates with prominent organizations such as Domino’s in New Zealand and the United Kingdom. Additional clients include New Zealand Post, the Defense Force, the Department of Conservation, Pāmu (Landcorp Farming Limited), and various local businesses.

Strategic Focus on Enterprise Solutions

According to Timothy Allan, CEO and co-founder, “We possess a robust enterprise market presence in New Zealand and have cultivated a substantial pipeline of international sales.”

Although direct-to-consumer sales currently constitute the majority of Ubco’s revenue, the company is actively prioritizing expansion into the enterprise sector, particularly through subscription-based services.

The Subscription Model and Revenue Growth

The 2X2 is built upon an intelligent platform integrating vehicle and power systems, cloud connectivity, and data analytics. This infrastructure supports the implementation of a subscription model alongside existing fleet management systems.

Ubco projects a significant increase in revenue, rising from $2.1 million in 2020 to $8.4 million by the end of 2021. This growth is driven by efforts to enhance annual recurring revenue through subscriptions.

The Ubco subscription service, priced around $50 to $60 per week ($75 to $85 NZD) for fleet customers, is being launched in New Zealand, Australia, the U.K., Europe, and the U.S. throughout this year and into 2022. Consumer access to these subscriptions will become available in the coming months.

Sustainability and the Circular Economy

Allan believes that subscriptions represent the future of the electric vehicle (EV) industry. He cites both increased profitability potential and enhanced environmental sustainability as key benefits.

As Ubco expands its subscription-based business model, the company aims to become a leader in the circular economy.

Lifecycle and Environmental Impact

Ubco anticipates that vehicles operating under the subscription model will have a lifespan four times longer than those sold outright. Furthermore, they predict an 80% reduction in overall carbon emissions compared to traditional combustion vehicles.

“Subscription allows us to retain ownership of the vehicle, enabling comprehensive lifecycle management,” Allan explained. “A vehicle might initially experience high-intensity use, such as 60,000 kilometers in pizza delivery, or 30,000 kilometers on a farm. Subsequently, it can transition to a lower-intensity application, and eventually, the battery can be repurposed for passive solar storage.”

Addressing the End-of-Life Challenge

Allan views resolving the end-of-life issue for vehicle components as a significant personal and professional undertaking. He emphasizes the need for innovative solutions and a proactive approach to engineering for recyclability.

“For example, when designing a battery, avoiding the inclusion of fire retardant foam is crucial, as it hinders end-of-life recovery,” he stated. “This requires careful labeling, intentional engineering for disassembly, and a commercial system that supports the concept. Fortunately, the economic incentives and New Zealand’s product stewardship legislation are aligned to support this approach.”

A Competitive Advantage

Allan believes that embracing the circular economy through utility vehicles will not only benefit the environment but also prove to be a strategic business decision. He anticipates it will attract customers and provide a competitive advantage in the enterprise market.

“This is an integral part of the customer experience with us,” Allan concluded. “If we can design subscriptions and manage the vehicle lifecycle in a way that resonates positively with our customers, that is our primary objective. Most individuals desire to make responsible choices, and we can offer a solution that is both economically viable and environmentally sound.”

Source: https://techcrunch.com/2021/06/17/mobility-startups-can-be-equitable-accessible-and-profitable/