Exponent One will be led by Sandeep Divakaran, who has previously had a stint at ride-hailing company Ola as the CEO of its fleet management vertical. The new venture, which will partner with non-banking finance companies (NBFCs) to disburse loans to commercial EV owners, is also raising $2 million in funding from Exponent’s earliest backer and mobility focused investor, AdvantEdge VC.
“The commercial vehicle segment is one of the hardest to finance. Even with ICE (internal combustion engine) vehicles, earning patterns tend to be erratic, which makes it a high-risk category for lenders,” Vinayak said.
“With EVs, the challenge is even greater because the asset itself is still not well understood. There’s uncertainty around battery life and resale value. At the same time, we need to accelerate EV adoption, and financing remains a key bottleneck. Our vision at Exponent One is that EVs should eventually become more financeable than ICE vehicles,” Vinayak added.
Exponent has so far raised nearly $45 million from the likes of Lightspeed, Eight Roads Ventures and 3one4 Capital. The startup will own 51% of Exponent One, AdvantEdge VC will hold 25% and the rest will be owned by Divakaran and an Esop pool.
The company is betting on insights drawn from its charging infrastructure business to strengthen how it underwrites financing. “EVs are digital, earnings are digital and the energy stack with Exponent is digital, and all these input metrics layered with innovations in AI tech, enhance our ability to underwrite and support driver-owners,” Vinayak said.
Elaborating on how Exponent One’s offerings will stand out vis-a-vis other financing companies in the ecosystem, Divakaran said that the current structures are not tailormade for the realities of the industry. “The core to building commercial vehicle financing is to ensure that the whole ecosystem and the product make the driver succeed,” he said. “There are three levers to making them succeed: the market has to have enough business, the vehicle has to run and third, the driver needs to have the ability to run it.”
NBFCs finance nearly 60-70% of commercial vehicles in India. However, most underwriting models, Divakaran said, rely on bureau scores and static income documentation.
Commenting on the development, Kunal Khattar, founder, AdvantEdge, said, “Exponent One is addressing the core risk mismatches that have held this industry back. We believe this is the missing piece that will finally move electric fleets from pilot to mass adoption.”