IIT-Madras incubated ePlane seeks $40–50 million to build electric air taxi prototype

Indian electric aircraft startup ePlane is seeking to raise between $40 million and $50 million in fresh funding as it advances plans to unveil a full-scale prototype of its electric air taxi this year, according to The Economic Times. The Chennai-based company, incubated at IIT Madras, is structuring the round to include equity, convertible instruments and potential government-backed research and development support. Sources told The Economic Times that the board has approved a $15–20 million convertible tranche expected to close next month, with further capital contingent on its application to the government’s ₹1 lakh crore ($11 billion) Research, Development and Innovation (RDI) Fund. The RDI Fund, launched in November last year to support deep-tech and strategic sectors, has so far seen limited deployment, with approximately ₹300 crore ($33 million) allocated, The Economic Times reported. The funding push comes as India’s air taxi market gathers regulatory and competitive momentum. In September 2024, the Directorate General of Civil Aviation (DGCA) issued an advisory circular outlining airworthiness certification requirements for electric vertical take-off and landing (eVTOL) aircraft. The move provided greater clarity for companies seeking commercial approval in the emerging segment. Four months later, ePlane secured formal DGCA acceptance for Type Certification of its eVTOL aircraft, the e200X. The company has stated it aims to commence commercial eVTOL services by 2026, beginning with air ambulance and cargo operations before expanding into passenger services following regulatory clearance. Competition is intensifying. Archer Aviation has signed a memorandum of understanding with InterGlobe Enterprises, parent of IndiGo, for a proposed 200-aircraft arrangement valued at around $1 billion, subject to approvals. Archer has said it intends to launch air taxi operations in India by 2026. Domestic players such as Sarla Aviation and BluJ Aero are also advancing prototype development. Capital requirements in the sector remain high, making software partnerships critical to managing engineering risk and cost. ePlane is leveraging Nvidia Omniverse to build digital twins of its eVTOL models, enabling virtual simulation and testing before physical deployment. It also collaborates with Dassault Systèmes, using its cloud-based 3DExperience platform to accelerate development and support certification processes with the DGCA. Such digital engineering tools are increasingly central to deep-tech hardware startups seeking to shorten design cycles and reduce regulatory uncertainty. The capital intensity of the sector has been underscored globally by setbacks, including the insolvency filing of German air taxi maker Lilium, as reported by international media outlets. ePlane’s proposed funding round is expected to support prototype development, testing and certification efforts as it competes for first-mover advantage in India’s nascent urban air mobility market. India’s aviation ecosystem is evolving rapidly, with policymakers signalling support for indigenous aerospace innovation while tightening safety frameworks. The success of ventures like ePlane will hinge not only on capital access but also on regulatory approvals, infrastructure readiness and consumer adoption. For now, the company’s immediate milestone is clear: deliver a full-scale prototype and secure the funding runway needed to transition from concept to commercial flight. As the global race for electric air taxis accelerates, India’s startups are positioning themselves to ensure that the next frontier of urban mobility is not imported — but built at home.