Kenyan electric vehicle start-up BasiGo has raised Sh488.6 million ($4.3 million) in a second round of funding to scale its business in the clean transport space.
The company said it will use the funds to accelerate the shift to electric vehicles by public transport operators by setting up a local assembly for buses.
Assembling locally will enable the company to benefit from the exemption from 25 percent import duty on the vehicle parts.
This will see the firm cease the import of the buses from a China-based automotive company in the venture to provide an environmentally suitable and cheaper alternatives to diesel.
BasiGo joined the market last November and raised Sh100 million in seed funding.
The second round funding was raised from Novastar Ventures with participation from Silicon Valley investors including Moxxie Ventures, Nimble Partners, Spring Ventures, Climate Capital, and Third Derivative.
“The support and knowledge of this investor group will catalyse BasiGo in its mission to make East Africa a leader in inclusive, sustainable bus transport,” said Jit Bhattacharya, the CEO and co-founder of BasiGo.
The firm plans to sell the electric buses for the same upfront cost as an equivalent diesel bus.
The operators will then pay for the battery and charging separately through the “pay-as-you-drive” financing solution.
Through this model, it plans to deploy over 1,000 locally assembled electric buses in Nairobi over the next five years.
BasiGo has brought two 25-seat electric buses from China firm, BYD Automotive that will enter pilot operation with select bus operators in Nairobi from March.
The buses will be travelling 250 kilometres on a single charge.
The shift to electric vehicles in the country is slowly gaining momentum with increased investors eyeing the space.
Last year, engine converter Opibus raised Sh834.37 million ($7.5 million) in equity and grant funding to scale up the production of electric motorcycles and buses in Kenya.
The firm converts diesel and petrol engines into electric motors reducing fuel costs and carbon dioxide emissions.