After being courted by several major OEMs according to our sources, electric motorcycle manufacturer Brammo received a minority investment by Polaris Industries today. The move will give Polaris access to Brammo’s proprietary electric powertrain technology, and positions the large OEM to enter further into the electric motorcycle market as a strategic partner to the Oregonian company. In the process of this investment, Brammo has also closed a $28 million Series B round of funding that also included contributions from repeat investor Alpine Energy and first-time Brammo investor NorthPort Investments, LLC.
Polaris has already been aggressively expanding into new market segments this year by buying both Indian Motorcycles and electric car manufacturer GEM. Polaris’s investment in Brammo, the two companies will form a strategic partnership that will presumably see Brammo’s electric drivetrain in different Polaris Industry products, which gives the American company a formidable ally in the move to electric-powered vehicles. For Brammo, the news bodes well as it not only means an infusion of fresh capital, a roadmap to further funding, and a step closer to a possible exit, but Polaris will also be sharing its vast array of technical, sales, and support knowledge to the electric startup.
Polaris has been the company to watch in 2011, as CEO Scott Wine has aggressively been expanding the American company’s presence throughout the powersports industry. Able to immediately benefit by adding electric drivetrains to the company’s four-wheel ATV and side-by-sides, Polaris’s acquisition of GEM and partnership with Brammo give it a significant leg-up against the other major OEMs in bringing electrics to market. We don’t expect today’s news to be the last we hear of Wine’s voracious appetite, and the CEO continues to impress us with his guidance of Polaris’s future.
“We are excited to advance our electric vehicle capability by establishing Polaris as a business partner and part owner of Brammo, one of the most innovative and aggressive companies I have found in the electric motorcycle space,” said Scott Wine, Polaris CEO. “Our companies share a passion for performance, and I look forward to exploiting the numerous opportunities created by pairing Brammo’s industry-leading electric powertrain technology with Polaris’s vast array of market-leading powersports products. This is a small but important investment for Polaris in an electric vehicle market that we feel is poised for significant growth.”
“We have always been impressed with Polaris’ leadership within the motorsports industry,” said Brammo CEO and founder Craig Bramscher. “Polaris is a company founded on innovation and quality, and as such their decision to partner with Brammo is a resounding endorsement of our technology. This is a terrific scenario for Brammo’s customers, as we bring Polaris’ legendary engineering, manufacturing, and customer service expertise to bear on our products.”
Source: Brammo & Polaris Industries
“After being courted by several major OEMs according to our sources,”
Always bringing that extra interesting tidbit. Hmmm. Grats Brammo and Polaris!
Polaris Invests in Brammo’s $28 Million Series B Round – Asphalt&Rubber http://t.co/AqctQKGT
I read a lot of these stories about large OEMs buying technology rights from the electric bike startups, and I just don’t get it.
What, exactly, is Polaris going to get from Brammo that they couldn’t just do for themselves? AFAIK they don’t make batteries and don’t make motors. What else is there? Brammo is packaging batteries, motors, and controllers into running bikes, and they’re doing it on a (relatively speaking) shoestring budget and with a small engineering force. What about that couldn’t Polaris just do themselves?
A lot of research goes into selecting the technology and then getting all the pieces to work well together. Add to that Brammo’s transmission. Add to that Brammo racing experience and entrepreneurial thinking and agility. It is not as easy as it looks to make these bikes work right and appeal to buyers.
Polaris could start from scratch but they would need to think at least 2 years ahead because that is the earliest they would get to market with a product.
This is basically the business equivalent to what dogs have been doing to fire hydrants since the dawn of time. Brammo hasn’t built or achieved anything that Polaris or another major OEM couldn’t do by spending a bunch of money or throwing hundreds of engineers at the EV segment.
But why do that? Why take the risk in building a new market, educating new customers, and fighting all the battles that come with the territory. I’ve said for a long time that we’re going to see the OEMs sit around while these startups do the heavy lifting, and when the market is ripe they’ll move in and play.
What Polaris has basically done here is said, “Here Brammo, here’s some more money so you can continue to do what you do. Go prove that this will work in the consumer market, and if it does then we’ll take another look at you.” Then they went canine, lifted their leg, and marked Ashland so another OEM doesn’t get the same idea.