Gogoro’s public debut could supercharge EV battery swapping across the globe

Gogoro, the company behind Taiwan’s thriving two-wheeler battery swapping ecosystem, is poised to succeed where others have tried and could not — and now it has the cash to do so.

On Monday, the company closed its merger with special purpose acquisition company Poema Global and is now listing on the Nasdaq under the ticker GGR. Gogoro expects to receive about $335 million in cash proceeds from the deal. 

Gogoro’s public debut and success in raising money suggest there’s a market for battery swapping stations, but only if the conditions are right. Around a decade ago, Israeli startup Better Place tried and failed spectacularly to popularize battery swapping for electric cars. But it was both too early in the collective electric vehicle journey for such a business to succeed and too much of an investment to build all of the infrastructure required to easily swap out batteries of large four-wheeled vehicles en masse. 

Backed by more favorable market conditions and much better timing, Gogoro has been able to unlock the recipe needed for scaling its battery swapping system. But that doesn’t mean Gogoro’s business model will work everywhere — while cities like New York or San Francisco suffer from congestion and would likely benefit from a platform such as Gogoro’s, too many habits surrounding Americans’ preference for four-wheeled vehicles would have to change to make it successful, and Gogoro knows that. 

Instead, the company is focusing on the markets where it can win – namely dense Asian cities where two-wheeled vehicles are already popular. Gogoro will use the fresh funds from its IPO to continue to expand in Taiwan as it branches outward to larger markets like China, India, and Indonesia. 

Why battery swapping matters

Since its founding in 2011, Gogoro’s “Swap & Go” battery swapping solution — where riders of electric mopeds, scooters, and motorcycles with Gogoro batteries can easily swap out a dead battery for a fully charged one — has become ubiquitous in Taiwan. Coupled with Gogoro’s Smartscooter, which the company first dropped in 2015 to help its business model along, the battery swapping system has enabled electric two-wheeler adoption.

In Taipei, a quarter of all new scooters sold last December were electric, and nationally, 97% of e-scooters sold in 2021 were either Gogoro scooters or powered by Gogoro’s batteries and charging infrastructure, according to data shared by Taiwan’s government.

Just last week, Taiwan said all new passenger cars and scooters will have to be zero-emissions by 2040 – the government is putting around $5.8 billion (TWD168.3 billion) toward this aim, including using subsidies and other incentives to see the share of new electric scooters hit 35% by 2030 and 70% by 2035.

“That’s a huge endorsement for what we’re doing,” Horace Luke, CEO and founder of Gogoro, told TechCrunch. “The company’s gotta be bulked up to take advantage of that transition and support our partners. We have Yamaha, Suzuki Taiwan, Aeon, PGO, and a bunch of guys are looking for us to build up the infrastructure as they transition to electric.”

E-motorcycle maker Cake closes $60M round to scale production and retail sales

Swedish electric motorcycle manufacturer Cake has announced the close of a $60 million Series B that the company will use to help set up manufacturing facilities in Europe, North America and Asia, as well as scale up its retail capabilities.

“We are in the process of implementing initiatives to scale the business, structuring and laying the base for rapid growth,” said Stefan Ytterborn, founder and CEO of Cake, in a statement.

Cake recently launched the Makka, an electric moped for city riding, which demonstrates a shift in direction of Cake’s product platforms. Its first two vehicles, the Kalk and the Ösa, are made for heavier duty, off-road riding and utility, so the Makka has helped to expand Cake’s user base within B2C and B2B, says Ytterborn.

The new manufacturing facilities across three continents will help Cake be more sustainable and efficient as it aims to ship its vehicles direct-to-consumer worldwide, according to the company. Until recently, the bikes were only assembled in Taiwan and shipped to warehouses in the U.S., Canada and Europe or directly to customers in  Australasia. Each shipping container from Taiwan could fit 25 bikes. Now, Cake can ship enough components from Taiwan to its European or North American facilities to equal 150 bikes per container, reducing shipping volume by more than 80%, a Cake spokesperson told TechCrunch.

The European assembly has been up and running since July, and the company aims to have North American assembly begin in the first half of next year, according to the company.

“Efficiency wise we will be able to assemble an order with two weeks delivery time instead of ordering eight months beforehand, reflecting what anticipated demand will be: high inventory risk and cash flow heavy,” said the spokesperson.

With the fresh funding, Cake will also begin to set up a retail presence, with showrooms popping up in major cities beginning this fall, says Ytterborn.

“We knew we were entering a space with increasingly strong tailwinds when we got started back in 2016, but we couldn’t dream of the pace in which things are now happening, for the good of people, planet and business,” he continued.

The round consists of convertible notes of $14 million and a $46 million financing round. The latter was led by Swedish pension fund AMF, according to Cake. A handful of new investors also participated in the round, as well as existing stakeholders, Creandum and Headline, two VCs that participated in Cake’s $14 million Series A in 2019.

“Cake’s obsession with creating a superior user experience has been ingrained in the company’s DNA from day one and is something we can fully identify with,” said Staffan Helgesson, general partner at Creandum Advisor, in a statement. “We are very happy to continue to support the team for the long term in their ambition to become the category leader in the premium two wheeler electric vehicle segment.”