The e-scooter global
market size is projected to hit over $30 billion
by 2028. While e-scooters, as we
know them, seemingly started to pop up very
recently, the first device resembling a
motorized scooter was invented in 1915 by a
company called Auto PED in Long Island City, New
York. Now they're electrified
and lining the streets of major metropolitan
areas, some using them as a convenient and quick
last mile mode of transportation and
others complaining about how they clutter
sidewalks. E-scooter rideshare systems are
already in 158 US cities, including Washington,
D.C., which will have over 20,000 rentable
e-scooters by the end of the year. That's about
four times the amount of bikes available in their
city bikeshare program. It's a program that has
offered a lot of different variety and
additional mobility options throughout the
district. It was designed with a
commitment to provide equity, sustainability
and also definitely make sure we have safety in
mind. Despite e-scooters
essentially becoming a part of the culture and
a regular mode of transportation in cities
like D.C. and Austin, which has
over 10,000 e-scooters. Rideshare e-scooter
businesses are struggling and other cities like
New York and Paris have partial or full bans in
place for rideshare e-scooter companies. Companies like Bird,
Lime and Spin have all faced issues working
with cities, backlash after fatal accidents
and are simply struggling with profitability. When Bird Global, one of
the largest e-scooter rideshare companies in
the industry, went public via SPAC in November
2021, it had an implied $2.3 billion valuation. Now its stock has
tumbled about 98% from its peak. The primary reason is
that focus in not on top line growth,
which is maybe where the markets were a couple of
years ago, and a focus in on total co
profitability, where we just recently are
starting to make the turn on that. I chalk it up to more of
a symptom of just a young company, high growth
kind of going public maybe a year or two
before it probably otherwise would have or
should have. Some cities like D.C. view rideshare
e-scooters as a beneficial additional
transportation option because they're quiet,
environmentally friendly and relatively cheap. I've seen the growth,
I've seen the interest, I've seen the request
that we've received here in Washington, D.C.
alone for different vendors that want to
come and do business here in Washington, D.C. And so I do believe it's
here to stay. As opposed to a gimmicky
joyride for tourists. People in D.C. do use
them regularly as a mode of transportation. In 2022, there were five
shared fleet electric scooter permitted
companies that were operating here in D.C. and together they had
over 5 million rides. Other cities have more
strict rules with riding e-scooters and the
rideshare companies in operation. San Francisco
recently saw the exit of Bird as the company
decided the city has become too difficult to
work with as it makes strides towards
profitability. We operate in around 400
cities and they had the highest
fine rate of any city in the world that we
operate in. And they were in the top
1% of cities for vehicle theft. Some cities like San
Francisco have strict parking laws, as
residents often complain about scooters on the
sidewalk and view them as clutter. In a two month
span last summer in San Francisco, there were
over 12,000 citations for improperly parked
e-scooters, resulting in Bird paying $385,000
Lime $577,000 and Spin $390,000 in fines. And early in that same
summer, San Diego required e-scooter
companies to install geo-fencing that
deactivates e-scooters riding on sidewalks. This is the newest form
of transportation. We haven't historically
thought of it in our planning and our
infrastructure, and so we are playing catch up and
doing it as quickly as we can. I know some other
cities have landed in different areas, kind of
on the value proposition that these vehicles
bring. Many cities have strict
laws against the use of e-scooters on sidewalks
that can include hefty fines. In Paris, 89% of
voters voted to ban rentable e-scooters from
the nation's capital, citing safety as the
main concern, with e-scooter usage both for
riders and pedestrians. This vote comes as Paris
plans to ban cars from the city center in early
2024, in what some are seeing as a
counterproductive measure for its car-less ideal. We have an imperative as
a society to get cars off the road, and that's
true whether you consider congestion, emissions
and air quality or housing affordability. Transportation is the
largest contributor to greenhouse gas emissions
in the US at 27%. An e-scooter halves the
amount of CO2 produced by a car with about 200g
per mile traveled so long as they're being used to
replace short car trips instead of a walkable
trip. They're a clear environmental
improvement over cars. Cities understand this,
and that's why they're publishing goals to
reduce emissions and get cars off the road. That
includes New York City saying they're going to
reduce emissions by 50%, San Diego by 60%. San Francisco said they
want 80% of trips taken to be out of single
occupancy vehicles by 2030. Micromobility is
an excellent way for cities to achieve that
goal. E-scooters are far more
efficient per mile than a combustion engine car. Between 30 and 40% of
trips replace a driving trip. We see a lot of
those replacing the TNCs, the Uber and Lyft's. However, some studies
have suggested that e-scooters are more
frequently replacing walkable trips than
short drives or Ubers. And while some complain
about e-scooters taking space on the sidewalk,
they use a lot less space overall than cars and
don't require any new parking infrastructure. Since we permitted
e-scooter operations in Denver back in 2018,
riders have traveled more than 15 million miles,
12.9 million trips folks have taken on shared
bikes and scooters. I should highlight that
includes bikes as well. And with that, we've
reduced nearly 5 million driving trips from
Denver's roadways. Because they take up so
little space. E-scooters also
contribute to reduced traffic congestion. One study showed that
after Atlanta banned e-scooters and e-bikes
for a period in 2019, commute times increased
by 10%. And it's estimated that
micromobility could reduce national travel
times for drivers by over 17%. And rideshare
programs are relatively affordable. An average
ten minute trip, which can get you a little
over two miles, costs under $5. One of the main concerns
city residents have with e-scooters revolves
around safety, and the Consumer and Product
Safety Commission found that there are nearly
120,000 emergency room visits, with 68 riders
killed between 2017 and 2021 using e-scooters,
while 53 died from riding e-bikes. In San Francisco there
was an increase in e-scooter injuries from
2020 to 2021 by about 58%, up to 153 injuries. Certain laws and
limitations have proven successful in the
decrease of injuries. In Finland, we saw that
when we limited the availability of the
e-scooters at night, we saw a decrease in the
incidents of the injuries. In the study
period. Most of the accidents
happened from 9 p.m. to 4 a.m. From those patients, two
thirds were intoxicated. So so that was a big
problem. And in 2022, we saw that
there were 60% less of these injuries
in the following summers when these restrictions
were in place. One study found that
there was one e-scooter injury for every 5555
miles traveled and a lack of protected lanes for
micromobility could be at fault for some of the
e-scooter fatalities, 72% of which involved motor
vehicles and 74% of all injuries happen on paved
roads. In addition to rider
safety, concerns over pedestrian safety is
also a factor. But a recent study at a
major metropolitan hospital found that only
about 5% of e-scooter-related
emergency room visits were pedestrians. The patients that were
treated in the hospitals that we looked at, only
3% of those were pedestrians or
bicyclists or someone who didn't ride the
e-scooter. So that tells us that
most of the accidents happened to the rider
itself. While the number of
accidents is fairly comparable to other
modes of micromobility, many cities like DC are
still enforcing laws like the prohibition of
sidewalk riding in busy pedestrian areas to
ensure safety. We're committed to safety
first and foremost, and that is why we enforce a
ten mile per hour speed limit on our shared
fleet of electric scooters. While shared
micromobility use has become increasingly
popular, e-scooter companies like Bird and
Lime have struggled with profitability. In 2022,
Bird had a net loss of over $350 million
compared to a $215 million loss the year
prior. It's probably too
crowded, too fragmented a landscape in terms of
companies out there. Now a plethora of
companies have sprouted after bird in Lime's
initial launch, and some companies like Uber have
tried its hand in the e-scooter rid-share
business in DC and Austin, there are five
and four different companies competing with
each other for ridership respectively. While
these companies competing with each other have had
profitability issues, Bird says it's getting
closer to being profitable. So for 2022, Bird's
revenue is $245 Million. That was about
a 30% growth from the prior year. We are
guiding to an adjusted EBITDA of positive $15
to $20 million for 2023 and positive free cash
flow of $5 to $10 million in 2019. Ford acquired Spin
scooters for an estimated $80 to $90 million, only
to get out of the e-scooter business just
a few years later, selling the company to
Berlin-based Tier Mobility. Apart from
having to compete with other scooter share
companies within cities, they also have to work
with the cities to expand services which are
sometimes limited. For instance, in New
York, e-scooter rideshare companies are currently
only allowed in the Bronx as part of a pilot
program. While the NYC DoT considered the pilot
a success, it still hasn't expanded to any
other boroughs, and other cities haven't allowed
any rideshare micromobility companies
yet. There are still major
markets like Houston and New Orleans and Las
Vegas that haven't yet stood this up. So we
have a lot of potential as an industry to
continue growing. And then even in cities
where we're in today, those programs aren't
necessarily all at scale. So as cities like New
York pilot, smaller programs see that
they're successful, we'll see them expanding the
programs and operators will expand their
footprints even within cities that we operate
in today. You know, you've also
seen some cities that are leaning into the
opportunity, but they're doing it in sort of a
more measured way. I think over time, those
things need to change a little bit in order for
these companies to actually kind of become
sustainably, consistently profitable and still
grow. But again, I think that
that's just a reflection of this kind of like
test and learn period we're in right now. Lime, which also has
rentable bikes and is considering an IPO, said
that it was profitable throughout 2022 on an
adjusted EBITDA basis, which no other
Micromobility company has achieved yet. We just guided to be
free cash flow positive for the year in 2023 is
all about how do you build not just
sustainable unit economics so you see a
decent payback on the vehicles, but how do you
do that at a scale with a controlled central cost
base where you're covering your your
central costs and are actually generating true
free cash flow profitability as a
company? And that's where I think we are right
now.
