Indian ride-hailing startup BluSmart Mobility has recently raised $42 million in funding, setting its sights on challenging market leaders Uber Technologies Inc. and Ola Cabs. With a current valuation of $250 million, the company is positioning itself as a greener alternative by exclusively offering electric vehicles (EVs) for its ride-hailing services.

BP Ventures, the investment division of energy giant BP Plc, is among the investors in this round, holding a 20% equity stake. Co-founder Anmol Jaggi revealed to Bloomberg News that the company’s founders also participated in this funding round.

Founded in December 2019 by Jaggi and four other entrepreneurs, BluSmart Mobility is headquartered in Gurgaon, just outside of New Delhi. The company’s goal is to introduce a more environmentally friendly ride-hailing service to the vast Indian market. Prior to this round, BluSmart raised $109 million through its seed and Series A funding rounds.

The Covid pandemic initially slowed down the progress of ride-hailing services, but the market is now recovering. BluSmart has successfully expanded its operations to cover two of India’s largest cities, Delhi and Bangalore. While competitors Ola and Uber have integrated some electric vehicles into their fleets, BluSmart sees a niche in providing exclusively electric vehicle services. Jaggi believes that EVs can generate higher income for drivers and the platform, as well as offer clean and reliable rides to users.

Criticising the current market leaders, Jaggi, who also serves as the CEO, said, “Uber and Ola aren’t doing justice to their customers or drivers. Those platforms are losing money; their business doesn’t have unit economics.” BluSmart’s strategy appears to be working, as the company has seen its revenue triple over the last three quarters, according to its funding announcement on Thursday.

In addition to providing ride-hailing services, BluSmart supports car financing, collaborates with partners to set up electric charging infrastructure, and is involved in electric car manufacturing through its partnership with GenSol Engineering Ltd.

BluSmart plans to use the newly acquired capital to further penetrate major cities and expand its fleet to 10,000 vehicles within the next year, more than doubling its current fleet size of 3,500.