MATTER Motor Works Raises $25M to Scale Electric Motorcycle Manufacturing

MATTER Motor co-founders (L-R): Saran Babu, Arun Pratap Singh, Kumar Prasad Telikepalli, and Mohal Lalbhai

Ahmedabad-based electric motorcycle startup MATTER Motor Works has raised $25 million in growth capital from existing investors, taking total funding to about Rs 1,000 crore or US$104.4 million. The company will expand manufacturing, strengthen its supply chain and distribution network, and launch four new motorcycles as India’s electric two-wheeler market accelerates in 2026.

Why has MATTER Motor Works raised $25 million?

MATTER Motor Works, the Ahmedabad-based electric motorcycle startup behind the AERA platform, has raised $25 million (about Rs 240 crore) in growth capital from existing investors, as it moves into its next phase of manufacturing and market expansion.

The August 2026 funding round includes Helena, Capital 2B, Japan Airlines, TransLink Innovation Fund, and the Shakopee Mdewakanton Sioux Community (SMSC). The round brings MATTER's total capital raised to approximately Rs 1,000 crore.

More than Rs 750 crore, or roughly 75% of MATTER's total capital raised, has already been deployed toward manufacturing, research and development, and market entry, according to the company.

The latest investment signals a shift from technology development toward capacity expansion, distribution and product scaling.

How will MATTER use the new funding?

MATTER plans to deploy the latest capital across several areas over the next 12–24 months, with a particular focus on expanding its ability to manufacture and sell motorcycles at scale.

The company's priorities include:

• Expanding manufacturing capacity and its supplier network.
• Increasing distribution and retail reach across India.
• Investing in brand building and customer acquisition.
• Launching four new electric motorcycles based on its technology platform.
• Scaling the AERA platform beyond its initial product.

The company has already moved beyond its pilot-production phase. MATTER began manufacturing its electric motorcycle in October 2024 and has since increased installed production capacity to nearly 1,000 motorcycles per month, compared with approximately 100–200 units per month during the pilot phase. It is targeting production of about 5,000 motorcycles per month by the end of FY2026–27.

MATTER has also expanded its retail footprint to 30 dealerships across 21 Indian cities, with plans to reach nearly 50 dealerships by the end of 2026.

What makes MATTER's AERA electric motorcycle different?

Founded in 2019, MATTER has developed much of its EV technology in-house, including its battery system, powertrain, electronics and software.

Its flagship AERA is positioned as India's first geared electric motorcycle and differentiates itself from the predominantly single-speed architecture used by electric two-wheelers.

AERA technology	Key specification
Transmission	Four-speed manual gearbox using MATTER's HyperShift technology
Battery	Liquid-cooled battery pack
Motor	Liquid-cooled electric motor
Charging	Onboard charging from a standard 5-amp household socket
Certified range	Up to 172 km
Connectivity	7-inch connected touchscreen
Platform	MATTER's vertically integrated EV technology platform

This approach gives MATTER a positioning closer to conventional geared motorcycles while retaining an electric powertrain. The company says its vertically integrated approach covers core components including battery systems, powertrains, control electronics and software.

Why are MATTER's existing investors backing the company again?

The latest round is notable because the investors participating already backed MATTER during its earlier development phase.

Founder and Group CEO Mohal Lalbhai said the investors are returning after the company's technology and market proposition have progressed toward commercial validation. The new capital therefore arrives at a different stage of the company's development: MATTER is moving from proving its motorcycle technology to scaling manufacturing and distribution.

That distinction matters in India's EV market, where production capacity, supply-chain reliability and retail distribution can be as important as the underlying vehicle technology.

MATTER's previous major financing included a $35 million Series B tranche led by Helena in July 2024, before the company entered its current capacity-expansion phase.

How fast is India's electric two-wheeler market growing in 2026?

MATTER's expansion comes as India's electric two-wheeler market reaches record sales.

According to Vahan data reported by Autocar India, electric two-wheeler retail sales reached 204,266 units in July 2026, the first month in which the market crossed the 200,000-unit threshold. Sales for the first seven months of 2026 reached 1.17 million units, up 56% year on year.

The scale of the market is increasingly attracting established manufacturers and EV specialists:

Company	July 2026 / Recent funding milestone
TVS Motor	55,477 electric two-wheelers sold in July; 27% monthly market share
River	Raised $120 million in August 2026 for manufacturing expansion and new models
Yulu	Raised $93 million to expand its electric fleet for delivery and logistics
Ather Energy	Raised Rs 1,300 crore through a QIP in July 2026 following its public listing

TVS's 55,477 units in July 2026 represented a record monthly performance and gave the company a 27% share of India's electric two-wheeler retail market for the month.

The funding environment reflects the same shift in market maturity. Capital is increasingly moving toward companies that can demonstrate production capacity, distribution, customer demand and repeatable commercial operations, rather than startups that remain primarily at the prototype stage.

How is India's PM E-DRIVE scheme supporting electric two-wheelers?

Government policy remains another important factor in India's EV expansion.

The Ministry of Heavy Industries' PM E-DRIVE scheme was originally launched in September 2024 with a Rs 10,900 crore outlay. The government subsequently extended the scheme through March 31, 2028.

The scheme includes demand incentives for electric two-wheelers alongside support for other EV segments and charging infrastructure. The official PM E-DRIVE portal currently states that the e-2W terminal date has also been extended to March 31, 2028 following an August 2026 amendment.

The policy framework is significant for manufacturers such as MATTER because it combines consumer-side incentives with efforts to strengthen India's domestic EV manufacturing ecosystem.

As of August 23, 2026, the PM E-DRIVE dashboard recorded more than 733,000 e-2W registrations, including temporary registrations, for FY2026–27.

What does MATTER Motor's $25 million raise mean for India's electric motorcycle market?

MATTER's latest funding round highlights a broader transition in India's electric two-wheeler industry.

The sector is no longer being defined solely by the development of new EV technologies. With 1.17 million electric two-wheelers sold in the first seven months of 2026, up 56% year on year, the next competitive battleground is increasingly about who can manufacture reliably, build distribution networks and introduce products that appeal to a broader range of motorcycle buyers.

For MATTER, the $25 million investment, approximately Rs 1,000 crore in cumulative funding, and planned four-model product rollout over 12–24 months provide the capital base to pursue that next stage.

The company's challenge now is execution: converting its technology-led differentiation into higher production volumes, wider retail availability and sustained customer demand in one of the world's fastest-growing electric two-wheeler markets.

 

 

FAQs

1. How much funding has MATTER Motor Works raised in 2026?
MATTER Motor Works raised $25 million, or about Rs 240 crore, in growth capital in August 2026. The round takes the company's total capital raised to approximately Rs 1,000 crore.

2. Who invested in MATTER Motor Works?
The August 2026 round included existing investors Helena, Capital 2B, Japan Airlines, TransLink Innovation Fund, and the Shakopee Mdewakanton Sioux Community.

3. What will MATTER Motor Works do with the new funding?
MATTER plans to use the funding to expand manufacturing and its supplier network, strengthen distribution and brand building, and launch four new electric motorcycles over the next 12–24 months.

4. What is MATTER AERA?
AERA is MATTER's electric motorcycle platform, featuring a four-speed manual transmission, liquid-cooled battery and motor, onboard charging through a standard 5-amp household socket, a claimed 172 km certified range, and a connected 7-inch touchscreen.

5. How large is India's electric two-wheeler market?
India recorded 204,266 electric two-wheeler retail sales in July 2026, crossing 200,000 units in a single month for the first time. Sales during the first seven months of 2026 reached 1.17 million units, up 56% year on year.