Battery Smart, a Gurugram-based battery swapping operator, has raised US$29 million in its series B funding round.

The round was led by New York-based private equity firm Rising Tide Energy, with participation from responsAbility, Ecosystem Integrity Fund, and LeapFrog Investments.

The company plans to use the funds to expand into new cities and enhance its presence in existing markets.

Battery Smart operates over 1,518 swapping stations across 321 locations in Delhi, serving electric two- and three-wheelers through its lithium-ion battery swapping network.

Founded by Pulkit Khurana and Siddharth Sikka, the company has facilitated over 74.9 million battery swaps and onboarded more than 68,000 electric vehicle drivers.

The company holds a 36% market share in the battery swapping sector and competes with VoltUp, SUN Mobility, and Mooving.

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🔗 Source: YourStory

🧠 Food for thought

1️⃣ Battery swapping’s renaissance after repeated historical failures

Battery swapping is experiencing a revival after multiple previous market failures that followed a similar pattern of initial enthusiasm followed by commercial disappointment.

General Electric’s GeVeCo battery service (1912-1924) offered EV owners swappable batteries that reduced vehicle costs by 33%, but ultimately failed due to declining demand and standardization issues1.

This cycle repeated with Better Place (2007-2013), which spent $600 million building a swap network before bankruptcy, and Tesla’s 2013-2015 Model S swapping experiment that was abandoned due to customer disinterest1.

Today’s market differs fundamentally from previous attempts through its focus on commercial fleets rather than passenger cars, particularly targeting last-mile delivery vehicles and three-wheelers where economics are more favorable.

The projected growth from $1.46 billion in 2025 to $22.72 billion by 2035 (31.5% CAGR) suggests investors now see battery swapping as a viable solution specifically for commercial mobility segments2.

Battery Smart’s 74.9 million completed swaps demonstrate real market traction in commercial applications, unlike previous attempts that struggled to achieve meaningful adoption levels.

2️⃣ India emerging as a key battleground for battery swapping innovation

While China dominates with 85% of global battery swapping deployments, India is rapidly becoming a competitive market with unique characteristics favoring swap technologies3.

Battery Smart’s 36% market share in India represents significant consolidation in a market where commercial three-wheelers—which are particularly suited for swapping due to their predictable routes and sensitivity to downtime—are widespread4.

The company’s revenue surge of 196% to INR 164 crore ($19.7 million) in FY24 demonstrates strong market demand, though doubling losses (INR 120 crore/$14.4 million) highlight the capital-intensive nature of building swap infrastructure5.

Battery Smart’s $29 million funding comes amid growing government support for battery swapping in India, where space constraints in dense urban areas make traditional charging stations impractical.

Commercial-focused battery swapping aligns with India’s electric mobility transition, where rapid adoption is occurring first in commercial segments rather than personal vehicles.

The competitive landscape with players like VoltUp and SUN Mobility suggests a race to achieve network density, as the value proposition to fleet operators increases with each additional swapping location.

3️⃣ Battery-as-a-service models transforming EV economics

Battery swapping companies are pioneering subscription-based business models that fundamentally alter EV ownership economics by separating battery costs from vehicle costs.

The battery-as-a-service (BaaS) approach can reduce the upfront cost of EVs by thousands of dollars, making electric vehicles more accessible particularly in price-sensitive markets6.

For commercial fleet operators, battery swapping can reduce operational costs by 20-30% compared to conventional charging methods due to higher vehicle utilization and reduced downtime3.

These services also create additional revenue opportunities through grid services, as batteries can be charged during off-peak hours and potentially function as virtual power plants7.

Battery Smart’s approach of targeting high-usage commercial vehicles directly addresses the economic challenge that previous battery swap ventures faced—the need for high battery turnover to justify infrastructure costs.

The $772,000 average setup cost for a battery swap station in China illustrates why achieving sufficient utilization is critical to profitability, explaining Battery Smart’s focus on dense urban deployments and commercial fleets7.

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