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- 🤯 The Silent Killer No One Told Log9 About (Until It Was Too Late)
🤯 The Silent Killer No One Told Log9 About (Until It Was Too Late)
Spoiler: Debt was just the finale. The real mistake started much earlier...
Admond Lee
May 11, 2025
Hey Founders,
Welcome to The Runway Ventures — a weekly newsletter where I deep dive into failed startup stories to help you become the top 1% founder by learning from their mistakes with actionable insights.
Today’s story is about how a deeptech darling in India is dying due to ONE deadly mistake. Let’s get to it! 🚀
Today at a Glance:
☠️ 1 Failed Startup → Log9 Materials
⚠️ 2 Mistakes → Pivoted away from core tech
🧠 3 Lessons Learned → Focus on your core strength
🔗 The Runway Insights → Y Combination’s Summer 2025 Requests for Startups
💰 Southeast Asia Funding Radar → Seedflex raises $3.2M (Seed) to improve access to credit
☠️ 1 Failed Startup: Log9 Materials
🚀 The Rise of Log9 Materials
🇮🇳 Founded in 2015 by Dr. Akshay Singhal, along with co-founders Kartik Hajela and Pankaj Sharma, Log9 Materials was started to revolutionise energy storage in India using aluminium‑air and graphene fuel‑cell technology.
The Problem — 🪫 India relied heavily on imported Li‑ion cells which are costly, supply‑chain‑fragile, and requiring heavy charging infrastructure.
The Solution — 🔋 Log9 promised a cheaper, locally‑made alternative to endure harsh climates and deliver long-range with minimal infrastructure.
By leveraging 16 proprietary graphene patents, Log9’s aluminium‑air fuel cells offered potentially 30–40% lower cost than Li‑ion and a longer lifespan.
⚡️ Their big breakthrough? Lithium-titanate (LTO) batteries that claimed to be absolute beasts - charging 9x faster, lasting 9x longer, and providing 9x better performance and safety compared to conventional batteries.
🛵 Imagine not having to worry about your delivery scooter's battery dying in the middle of nowhere or waiting hours for it to charge…
🪫 → 🔋 That's the problem Log9 is solving.
 Log9’s RapidX Batteries | 🤯 The pitch worked! Investors were practically throwing money at them. (I mean, who doesn’t want to solve climate change?) The growth was crazy. From 2022 to 2024, Log9 4x their revenue from ₹25.5 crore to ₹110.3 crore after pivoting to an EV-leasing model. |
🔋🔋🔋 At its peak, Log9:
Raised ~$60 million from top investors (Peak XV, PETRONAS Ventures, and Exfinity Venture Partners)
Hit valuation of $227 million
Hired 350 employees
Achieved 35 patents
Won multiple innovation awards
Established strategic partnerships with Omega Seiki Mobility and Quantum for their EV-leasing business
🇮🇳 By early 2023, Log9 launched India’s first commercial Li‑ion cell line in Jakkur, Bengaluru, and boasted a ₹150 crore cell‑factory investment, reshaping India’s EV battery landscape.
🤏🏻 Log9 almost became the legend of India.
📉 The Fall of Log9 Materials
Yes… almost.
😳 By 2022, Log9 realised they couldn’t compete with imported cells, so they shifted to an EV-leasing model by partnering with manufacturers to get their batteries on the road.
This “desperate pivot” turned out to be the worst decision ever made.
📌 Here’s what happened to Log9:
The company was trying to raise more funding since the beginning of 2024, as it ran out of cash. These attempts have not been successful, but before we look into that, we have to ask: Where did all the funding go?
🔋⚡️ The “Tesla Moment”
2015 — 🔋 Log9 Materials was founded by Dr. Akshay Singhal, later joined by Kartik Hajela and Pankaj Sharma as co-founders.
Mar 2017 — 💰 Received SEED funding from GEMS Partner.
2019 — 🔁 Pivoted to LTO (Lithium-Titanium-Oxide) batteries after failing to scale aluminum-air tech.
Oct 2019 — 💰 Raised $3.5 M (Series A) led by Sequoia Surge (now Peak XV) & Exfinity.
2020 — Akshay Singhal received the Indian National Academy of Engineering's 'Young Entrepreneur Award 2020'.
2021 — 💰 Raised another $8.5M (Series A) from Amara Raja.
2022
Reported revenue of ₹25.5 crore.
Announced a ₹150 crore cell-manufacturing plant in Bengaluru's Jakkur area.
🤔 Pivoted to an EV-leasing model, partnering with OEMs like Omega Seiki Mobility (OSM) and Quantum.
The OEMs deployed Log9’s batteries in their vehicles, which were then purchased by Log9 and leased to other fleet operators and delivery startups.
Log9 relied on financing platforms such as Revfin, Alt Mobility, Gentari and others to buy these vehicles.
🪫⛈️ The “Desperate Pivot”
Jan 2023 — 💰 Raised $40M (Series B) from Amara Raja and Petronas Ventures.
Apr 2023 — 🤦🏻♂️ Their cell-manufacturing plant finally started operation after delays in getting Chinese engineers on-site (delay in visa approvals).
It was too late as Chinese LFP (Lithium Iron Phosphate) batteries’ prices plunged 50% from about $95 to $45-$53 per kWh, destroying Log9's value proposition (charged faster, safer).
LFP batteries from China were 4x cheaper than LTO batteries (Log9).
Mar 2024 ⚠️⚠️⚠️
Revenue: ₹110.3 crore (from the leasing business)
Losses: ₹118.6 crore
Debts: ₹200 crore
Offices in Mumbai, Chennai, and Hyderabad shut.
🤯 Pivoted back to LFP batteries due to mounting customer complaints about LTO batteries.
Sep 2024 — 🪓 Mass layoffs began due to mounting debt.
Headcount dropped from 350 to <50.
Salaries & PF dues were unpaid.
Oct 2024 — 🤝🏻 Jupiter Electric Mobility (JEM) acquired Log9’s railway & e‑truck battery divisions for ₹40 crore.
Kartik Hajela (co-founder & COO) resigned to join Jupiter Electric Mobility as director.
Early 2025 — Log9 faced multiple legal cases with fleet operators, including one with BluWheelz.
Legal battles, asset repossession, and “borrowing to repay” spiralled.
May 2025 — 🚨 Facing severe cash crunch, with speculation rampant that the company will file for bankruptcy.
⚠️ Not just that, the Inc42 investigation found "deeper issues were at play", including weak corporate governance and fundamental misjudgment of how to scale a tech and asset-heavy business using VC money.
As Pankaj Sharma tries to find ways to revive the business against overwhelming odds, let’s not forget this:
It doesn’t matter if you’ve brilliant IPs or raised tons of funding from investors.
If you don’t have product-market fit, you’ll eventually die.
🤔 Do you think Log9 can save itself?
Want to learn more about Log9’s downfall?
⚠️ 2 Mistakes
Mistake 1: Pivoted away from core tech
About 2.5 years back, we started with LTO as a chemistry, and at this point, the China-made LFP batteries were about 2X cheaper than ours. So, LFP was always cheaper than LTO, but the performance was extremely poor. Today, Chinese LFP performance has improved substantially. They are also available at about $45 per kWh compared to $130 per kWh, whereas Log9 is buying LTO cells at $350 per kWh, creating more than a 4X gap.
Log9’s original superpower was its aluminum-air & LTO battery tech.
But when Chinese Li-ion cells flooded India, they panicked. Instead of doubling down on R&D, they pivoted to EV leasing — buying EVs with their own batteries and leasing them to fleets. Revenue did 4x… but profits? Nope.
Pivoting to EV leasing also meant Log9 might lose focus on making its LTO batteries better and more performant. Because of the distraction, Log9:
🤦🏻♂️ Lost its identity
They became a glorified rental company, not a deeptech innovator.
Fleet operators cared about cost, not fancy battery specs.
💸 Got trapped in debt
Leasing required massive upfront capital.
They borrowed heavily, relying on shady financiers and shaky customer payments.
🪫 Neglected its core tech
Their LTO batteries (meant to be their moat) became irrelevant as cheaper Chinese LFP batteries took over.
Even worse, Log9 pivoted to LFP batteries (again) when they realised they got outcompeted by cheaper and more performant Chinese LFP batteries, increasing its operational challenges to revamp its manufacturing infrastructure.
Mistake 2: Financial mismanagement of the company
Okay… How Log9 “borrowed to repay” was insane. It was like playing with fire. I tried to keep it short, so here’s how it works:
🤑 Log9 borrowed heavily to fuel the leasing business
Log9’s EV leasing model required them to buy thousands of EVs (with their own batteries) from OEM partners like Omega Seiki.
They didn’t have the cash, so they took venture debt (loans from VC/banks) + partnered with financing platforms (Revfin, Alt Mobility) to fund vehicle purchases with sky-high interest rates.
👻 Log9 couldn’t get paid fully by customers
Log9 leased EVs to fleet operators like BluWheelz, expecting monthly payments.
But Log9’s vehicles underperformed (bad batteries + range issues), so customers refused to pay full amounts (15-20% of dues) or simply defaulted.
The result? Log9 couldn’t recover this money, yet still had to repay their lenders.
On top of that, legal battles with BluWheelz and others also tied up cash in courts.
🤦🏻♂️ Took new loans to repay old loans (borrowed to repay)
With no cash flow from customers, Log9 has to borrow more to pay interest on existing debt.
Eventually, Log9 owed ₹200 crore in debt with no money to repay (probably that could be the reason why Log9 sold its railway battery unit for ₹40 crore).
Lenders seized EVs leased to BluWheelz and others.
🧠 3 Lessons Learned
Lesson 1: Focus on your core strength
If you’re a hammer, don’t try to be a screwdriver. Just find more nails.
Log9’s fatal mistake wasn’t just the pivot — it was abandoning what made them special.
🌮 Key Takeaways:
💪🏻 Define your “competitive advantage”
SaaS? Your algorithm/data moat.
E-commerce? Your supply chain speed or curation.
Hardware? Your proprietary tech or manufacturing edge.
Ask → "What can we do that competitors can’t easily copy?"
🏎️ If you must pivot, pivot around your strength
Any pivot should leverage your existing tech/IP, not replace it.
🔴 Bad Pivot
They went from “We make futuristic batteries” to “We lease scooters.” No connection.
🟢 Good Pivot
Tesla started with luxury cars (Roadster) but kept battery tech as its core. Later, they scaled into mass-market EVs, solar, and AI—all tied to energy innovation.
Lesson 2: Fix unit economics before scaling
Profitability > Vanity Metrics
🌮 Key Takeaways:
📈 Run the "5-Year Profit Test"
Ask: "If we 10x revenue, will margins improve or get worse?"
Log9’s answer: Worse (more leases = more debt).
Good Example: Airbnb scaled without owning homes — their margins improved with growth.
🪤 Avoid "fake revenue" traps
Services? Don’t take unprofitable enterprise contracts just for vanity revenue.
Marketplaces? Don’t subsidise buyers/sellers forever (RIP Groupon).
Rule: If you remove discounts, does demand still exist?
🤑 Pre-Sell before you build
Hardware? Crowdfund or take deposits.
Software? Sell annual plans upfront.
Lesson 3: Good Debt > Bad Debt
Good debt can help grow your business. But bad debt? It could kill your company (like what happened to Log9).
Manage debt like your life depends on it. Else it’d become a silent killer.
🌮 Key Takeaways:
⚡️ Borrow only for Multipliers
🟢 Good Debt:
A restaurant taking a loan to open a second location in a high-demand area.
A D2C brand borrowing to buy inventory for a proven bestseller.
🔴 Bad Debt:
Borrowing to pay rent for an empty store.
Using debt to fund R&D for an untested product.
🔥 Stress-test your debt
Ask these questions before signing up for the loan:
What’s the worst-case repayment scenario?
Can we repay this without revenue?
🤦🏻♂️ Never borrow to repay debt
The Log9 Spiral: Loan #1 → Can’t pay → Loan #2 → Can’t pay → Bankruptcy.
Renegotiate terms before missing payments. Offer equity swaps or extended timelines.
🔗 The Runway Insights
💰 Southeast Asia Funding Radar
Seedflex raises $3.2M (Seed) to improve access to credit (Link)
Neufast raises $1.1M (Pre-Series A) to help companies recruit and upskill easily (Link)
XWeave secures $3M (Seed) for stablecoin cross-border payments (Link)
Krenovator, a Malaysian AI-tech platform, bags seed funding to connect top tech talent to companies for their IT projects (Link)
Panmnesia raises $30M to develop solutions for AI infrastructure (Link)
Nuevocor nets $45M (Series B) to advance gene therapy for genetic heart disease (Link)
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That’s all for today
Thanks for reading. I hope you enjoyed today's issue. More than that, I hope you’ve learned some actionable tips to build and grow your business.
You can always write to me by simply replying to this newsletter and we can chat.
See you again next week.
- Admond
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