Electric motorbike brand Savic Motorcycles has hit the tarmac at a blistering pace with its equity crowdfunding campaign, hitting the minimum target of $500,000 before even opening the offer up to the public.
Facilitated via crowdfunding platform Equitise, Savic has tapped retail investors to raise up to $2 million to kickstart its manufacturing process and move closer to commercial construction of its café racer-style, battery-powered bikes.
Co-founder Dennis Savic told Business News Australia that an additional $83,000 has come in since last Friday when the company cracked the $500,000 minimum target, demonstrating substantial appetite from bikers and sustainability-minded investors alike who are keen on a slice of the local EV market.
With the raise set to open to the public on Tuesday, Savic is hoping backers will bring the total amount of capital raised to between $1.5 million and the maximum possible of $2 million.
According to Savic, the funds will be used for inventory and working capital so that the company can really gain momentum and satisfy the around 260 people who have pre-ordered one of the brand’s bikes.
“When it comes to where we’re at, all of our compliances are in place, pilot production is underway, and only 5 per cent of our components require minor modification before we consider them production-ready,” Savic said.
“So we’re largely production ready. We’ve got some final testing that we’re going to be doing over the next couple of months and we’re expecting that to clear.
“The funds that we’ve raised through Equitise will be used as working capital and for inventory to produce the first customer vehicles.”
READ MORE: Aussie electric motorbike brand Savic just months away from tyres hitting the asphalt
The founder says the first bikes will be delivered to customers sometime in July, and from there Savic expects others that have pre-ordered will receive their EV sometime in October or November once crucial components arrive at the brand’s West Melbourne HQ.
Once that’s complete, Savic expects larger investors will be more willing to take a punt on the company which is already backed by an R&D loan with the Victorian Government, a Federal Advanced Manufacturing Growth Centre grant, and capital from undisclosed investors.
“We’ve got two priorities at the moment. The first is to demonstrate, execute and deliver customer vehicles and prove that we can produce customer vehicles and deliver them - so that’s one thing that the big funds are waiting on; validation of that,” Savic said.
“The second thing that they’re really waiting on is validation of our unit economics. We do have very promising unit economics and we believe we can hit some targets that are greater than what the general industry normally sees.
“One factor that’s stopping us from doing that is our cost of manufacture. At the moment we sell them for as much as it costs us to produce them - but we have a roadmap to increase our gross margin from zero per cent at the moment to 43 per cent by sometime mid- to late-next year.”
The founder added that most of the funds were coming from smaller investors contributing in the order of $1,000 to $3,000 per investment, but that some larger investments of between $20,000 to $50,0000 were starting to trickle in.
“This has enabled us to publicly advertise that we are raising - people that are interested in our business aren’t just motorcycle riders now, they’re active investors both smaller and larger,” he said.
“The power of networking starts to become a play here. We’ve had people reach out to us that very likely would’ve never connected with us before, so that’s been a really interesting outcome.
“But quite a lot of the expressions of interest have come from our direct network as well - some 60 to 70 per cent of those who have submitted an expression of interest have been following us for some time.”
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