VanMoof raises $13.5M to capitalize on e-bike boom in wake of COVID-19

Mike Butcher

VanMoof, the Dutch e-bike startup that launched in 2009, is now officially a “scale-up” after attracting a €12.5M ($13.5M) investment from London VC Balderton Capital and SINBON Electronics, the Taiwan-based electronics manufacturer that is its bike assembly partner.

The funds will be used for international expansion following the launch of the new electric VanMoof S3 and X3 bikes.

The announcement comes at a fortuitous time. Cities all over Europe are gingerly emerging from lockdown during the recent outbreak of the COVID-19 pandemic, and European governments are desperate to get their economies moving. But much of the official advice is to avoid public transport where possible due to the near-impossibility of social distancing.

So with cycling a viable option in many cities, but distance still the old adversary, many consumers are looking to e-bikes as the solution to commuting, versus traditional bikes, which can't compete with an e-bike's ability to take the rider much farther than normal.

To boost take-up, the UK government has unleashed a £2 billion package to create a new era for cycling and walking, leading to shares in bike retailer Halfords jumping by 17% on Monday.

In the US, New York City just committed to adding protected bike lanes across Manhattan and Brooklyn. Berlin is extending some of its already extensive bike lanes. And Milan will introduce a five-mile cycle lane to cut car use after the lockdown. New York City has reported a 50% increase in cycling compared to this time last year. Cycling in Philadelphia has increased by more than 150% during the COVID-19 outbreak.

Taco Carlier, VanMoof co-founder, said in a statement: "It’s a unique time to build such a meaningful partnership. Not only do we appreciate this vote of confidence from an investor with deep sector experience, it’s a great sign that investments are becoming greener, shifting away from fossil fuels and toward e-mobility.”

Colin Hanna, principal at Balderton said: "VanMoof produces a category-leading product in a rapidly growing market that is changing the world for the better. We believe that the quality, community, and experience of VanMoof will make them a household name from Tokyo to Berlin.”

VanMoof recently launched the S3 and X3 models, which are upgrades to previous models at a significantly cheaper price. The price is a reflection of the fact that VanMoof has full control of the supply chain thanks to its partnership with SINBON combined with a direct-to-consumer sales model, which means it takes complete ownership of everything from design to production, from sales to after-service.

Furthermore, in the last two years, the company has quadrupled its €10M 2018 revenue to nearly €40M in 2019, with sales 20% above target throughout 2020 so far, meaning it’s looking at an annual revenue goal of €100m.

The high-performance new electric VanMoof S3 and X3 have a new range of features, including electronic four-speed gear shifting, integrated hydraulic brakes and double the Turbo Boost power.

But VanMoof is not the only VC-backed e-bike on the market. Brussels-based Cowboy is an e-bike startup that only appeared in 2017 but has since gone on to raise $19.5M from Tiger Global and London’s Index Ventures.

While it's a tragedy that it's taken a deadly pandemic to kick-start this market, the prospect of our cities becoming radically changed for the better, with cleaner air and healthier, bike-riding citizens, does seem to be appearing on the horizon.