From Rags to Riches #2: Ather Energy

You have to have come from under a stone if you have not heard of Ather Energy. For all the startup buffs in India, Ather has become India’s, Tesla. Well, why not? They are building electric run vehicles for us!

Ather energy is a start-up established by IIT Madras Alumni Tarun Mehta and Swapnil Jain. Both of them strongly believe in the superiority of electric vehicles and the future it possesses. Their motto “Be Curious” says it all. In an overflowing ICSR hall, on a heated up Sunday afternoon, these tech freaks returned to the insti thanks to the Mega Sunday Initiative taken up by the Entrepreneurship cell to talk about their fanatical pursuit towards excellence.

Everyone has a story to tell and the first thing Tarun Mehta, the CEO, talks about isn’t the product but the story behind the making of it. He says when the consumer has a plethora of substitute goods in the market already only technical superiority is not sufficient to market your good. Your product needs to have a story to it which makes the consumer go gaga over it. In his words, “It was very important for us to offer people something more than just an alternate scooter, and that’s why we have also focused on the dashboard designs and other technologies”.

When asked about the path that led them to their current success, Tarun says that he and Swapnil worked at Ashok Leyland and General Motors respectively after graduation. According to him, the best thing about Ather is probably that the co-founders were from the same institute. They have the benefit of an identical education system, which ensures that they are always on the same page and that they work in tandem to achieve the common goal.

By a stroke of luck, the first funding they received was from an IIT Madras alumnus. Currently, their team structure involves a dedicated team of 150 most of them with a technical background. Their recruitment policies require people with a mechanical background, and knowledge in plastic technologies, sheet metal, and power electronics. Besides tech savvy, they are always on the lookout for stalwarts from data sciences, operations and marketing and sales.

Their first official market product is priced at $340, and they hope to enter the market with just 12 more months at their disposal. They wholeheartedly believe that the future is going to be electric, and are not worried in the least by innovations in the biogas or the hydrogen fuel sector.

The reason they feel so strongly about the future being electric is that electric vehicles are considerably lighter than conventional engine based vehicles. They provide more maneuverability due to the reduction in the unsprung masses and also provide a lot more space. The recent research in cells and developments in the design of batteries has led to a cut down in the battery pack costs by volumes over the past few years, and these prices are expected to drop further, courtesy of Tesla, Reno, and Toyota, who are providing significant branding for the electric based models since 2005. And given the momentum electric vehicles have today, it is relatively easier to sell them than any other kind.

While responding to whether electricity itself is a degrading factor for the environment, he cites a hypothetical example from Delhi. He claims that all the vehicles in Delhi going electric will add up only 25% to the chunk. While this may seem like a very large value, the energy consumption of fossil fuels would be even higher, especially in the long run.

When questioned about their stand on the emerging hybrid models, they tell us that these models aren’t a durable solution and that the emerging sector doesn’t see them be promising. The reasons being that they don’t save much on the manufacturing costs and still take up a lot of mass and space. Though they still make some sense for 4 wheelers, it would be a bad idea to bring the technology to 2 wheelers. The reason why existing companies are opting for a hybrid is because the sudden shift to electric models is appalling. The expertise amassed so far is for IC engine based vehicles. The shift would be excruciating. Arun, the product head at Ather also says that while the hybrid model may seem intriguing, it isn’t very innovative.

When quizzed on whether the initial high price of their product would deter the consumers and their sales, Tarun is quick to point out that there are many companies which cater to the lowest in the pyramid and instead, they want to target a niche audience. He adds that going after a large market initially is a wrong strategy and that there is no point in lowering the costs to appeal to people who are not likely to be customers.

Returning to the discussion of how they started off as a company, they mention that they (Swapnil, and Tarun) got their first patent in BMS while working on the project. After that, they were quite interested in the electric concept, and thus, in spite of their placements in reputed automobile companies, they quickly left their jobs and came back to the engineering design department at IIT Madras, which had been their home for five years. With the help of a professor, they started working on their first prototype of the electric scooter in the robotics lab. “We just got a bunch of battery cells from China, welded a frame which mostly looked like a simple truss structure and built our first scooter”. Tarun also adds that the main concept behind Ather was seeded in their sophomore year itself and they were just looking for the right time to start up.

One lesson that Swapnil gives us is that while we always have to ideate and think about our final product/ goal, it is always helpful to build prototypes to test each idea that crosses our minds. “I sometimes believe that perfect is the enemy of the good. Maybe none of the prototypes were actually the scooter we wanted, but each one of them helped us perform more than 100 simulations for each specification.” They as well heavily relied on the manufacturing feedback they received for their product.

“What we kept in mind was that we wouldn’t JUGAAD our way out or won’t end up prototyping randomly. Also, when you are obsessed about completing a huge objective, it is very important to cross these stepping stones for people to believe in you and support you.”

They emphasized on the fact that while building a product, the campus provided them a very good cocoon for hardware development. While the knowledge of their professors supported them, the campus also shielded them from any demoralizing effects of the outer world.

On being asked about why they shifted to Bangalore, he chuckles and says “Oh! Just because of the weather.” And then he actually claims that Bangalore has less conservative people who actually support the unconventional. Hiring and getting people to shift is becomes an added plus. Moreover, the customer bias in Bangalore is huge.

Here, we compile a few important takeaways from Ather for anyone who wants to start up.

  1. There is no glory in pivoting your start-up. Pivoting implies that you have failed a lot of times.
  2. You should not start up while in insti unless the field in which you’re starting up has nothing to do with your engineering knowledge because if you do, you might lose out on the learning this great ecosystem has in store for you.
  3. The best time to start up is right after graduation or before your late 20’s. You shouldn’t wait for too long because, from your 30’s, the family pressure and other responsibilities start building up.
  4. Don’t cater to a very large market, initially. Have a good vision, but don’t strive for that from day one. First, cater to a market which is small but believes in your product.
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