India’s leading electric vehicle ride-hailing startup BluSmart is in urgent talks to raise $30 million to revive its operations and pay off outstanding liabilities, as the company reels from a financial and governance crisis that has brought its business to a standstill.
The company, which once operated over 8,700 EVs, has suspended operations, leaving thousands of cars idle and around 600 employees without salaries since March 2025.
Governance Shakeup & Founder Exit Clause
The proposed funding round is being pushed by existing investors including BP Ventures and ResponsAbility, but it comes with a key condition: the exit of co-founder Anmol Singh Jaggi from the board. Jaggi, who is also co-founder of Gensol Engineering, BluSmart’s primary EV lessor, has reportedly agreed to resign—but only if granted immunity from future legal proceedings by investors.
This condition stems from an ongoing regulatory probe into Gensol Engineering, which has cast a shadow over BluSmart's governance credibility and raised red flags among current and prospective backers.
Mounting Liabilities and Salary Delays
BluSmart is said to be struggling with:
- Overdue employee wages
- Pending vendor payments
- Idle EV fleet costing daily losses
This financial strain has pushed the startup into emergency mode, forcing leadership to explore external collaborations and even acquisition opportunities.
Exit or Merge? Strategic Alternatives on the Table
In parallel with fundraising talks, BluSmart is exploring:
- A strategic partnership with Uber, reportedly for a $15–20 million investment, in return for fleet integration or operational support.
- An acquisition offer from Eversource Capital, which is considering merging BluSmart with its B2B EV fleet operator Lithium Urban Technologies—at a significantly reduced valuation.
Three-Week Deadline to Restart Operations
Investors have reportedly set a three-week internal deadline to restart operations, aiming to:
- Restore business continuity
- Rehire core drivers and staff
- Win back market confidence before pursuing a larger growth round
However, the entire recovery plan hinges on resolving governance challenges and executing a leadership transition swiftly and transparently.
A Broader Cautionary Tale
BluSmart’s crisis underscores the fragility of governance in capital-intensive EV startups, where operational scale can quickly outpace risk controls. Once celebrated as a green mobility pioneer, the company now finds itself at a crossroads—facing hard questions around leadership, accountability, and long-term sustainability.