97 points by pseudolus 10 days ago
> The recent events are a reflection of shifting geographical needs
You know, I think what they're experiencing is, uh, Winter. This might be a foreign concept for people who live in sunny Santa Monica, so I'll explain: for about 5 months in most of the US, it gets really cold outside, kind of like your freezer. Crystalized water falls from the sky, and riding a scooter becomes both dangerous and very uncomfortable, so most people don't do it. Unlike, say, Uber, your revenue will likely take a real big hit during this time, instead of increasing.
More bad news for you, this does happen every year. Heck, in many of your largest markets, like Minneapolis and Chicago, it can last up to 8 months!
I'm available for hire if you need boots on the ground in this part of the country. First recommendation: Maybe don't keep hundreds of scooters on the streets during heavy snowfall! As far as I could tell, the total scooter capacity didn't decrease substantially over the past four months, no one was riding them, and I'm sure they took a lot of damage from the bad weather. Hunker down and wait for the sun!
Brilliant. I would like to see the simple plot of rides per day versus temperature.
It's been really cold in LA for the last month. We have weather too.
We have four seasons in L.A.: Fire, Flash Flood, Earthquake, and Awards.
Seriously, I've been noticing the cold. I haven't had to wear long pants for the whole season in over a decade. It feels so normal, going back to how it was in my childhood, but I know it's only a brief respite from climate change.
In Minneapolis, we say: Winter, and Construction.
> from climate change
You mean global warming.
It describes more accurately the situation we are in.
> The average low for the month was 46.5 degrees […] The overall average temperature during the month was 54 degrees
I'm sorry what? Only if they were measuring in kelvin does that qualify as "cold" let alone "really cold".
it's "really cold" if you're from southern california and "beach weather" if you're from a lot of the rest of the world
And even if you're a transplant (at least with me) that's used to cold winters, you've got 1-2 years before you normalize to the weather. First year here I really believed there was no winter in LA, but after you acclimate you realize it was all a lie!
So you're saying transport them to warmer climates for the winter... like birds.. flying south?
When I unlock the ability to upvote posts on hacker news, I am coming back and upvoting this comment.
I live in LA and the scooter situation is starting to get out of hand, at last count we had 5 companies competing in my neighborhood. I think it does solve a necessary problem, but there are easily 5+ scooters for every rider now. I fail to see how any of them can get this to profitability soon, let alone all 5.
To put this in perspective, there are about 8 parking spaces for every car in the US . A parking lot costs about $5,000 to $50,000 per space, depending on if it’s a gravel lot vs a parking garage. Yet parking lot operators and rental car companies are still able to make a profit.
Edited to remove sarcastic wording.
That big lot by the abandoned k-mart in Rockford has a lot of spaces but none of them are within walking distance of the restaurant I’m supposed to meet my friends at in Chicago.
In transit planning the walk shed for transit extends from one mile (that seems to be very optimistic high density east coast planning) to a quarter mile (more realistic in California’s cities) away from the station. By that same metric there should be plenty of parking spaces within a quarter mile of where you’re trying to dine. There’s also likely the parking space you have at home, and the space you have at work (assuming that like most Americans your job offers free parking).
That $5-50k is amortized over decades, though.
Bird's scooters cost ~$500, probably make under a buck a ride in profits, and I suspect their average lifetime is well under 500 rides.
Someone discovered shared scooters don't last long, and thus don't make anything even remotely approaching a profit.
When a startup is roughly a year old, and its rival just raised $300M, alarm bells should go off in investor's heads, "If both these companies started a year ago, and it only takes $300M to fund the next one, and none of them have IP or even make their own scooter, maybe we shouldn't do this since there are no barriers to entry."
only takes 300M
That seems like quite the barrier to me. Also crazy to think that 1/3 of a billion dollars is considered trivial barrier.
If you throw in NEA's new fund, that's five funds where $300M is less than 10% if they did the whole round, and if the economics are great, a bunch of growth equity funds.
It's crazy to me that you'd invest that much without having more data on the unit economics given none of these companies even have an advantage on making the underlying scooter. The more scooters you have and the more market share you have, the faster your bleed money. If the unit economics were great with off the rack scooters, what's to stop Lyft/Uber from adding a scooter option given they already have the demand side of "trying to get somewhere"?
I was looking at the figures in that article and was just horrified at the sheer environmental impact of this whole fiasco.
Have you seen the pictures of what must be tens of thousands of bike share bikes just sitting, unused, likely never to be used, in fields in China?
Wow. That's incredible. Thanks for sharing!
Wow. Those pictures are ridiculous.
It looks like they are losing money per scooter . I doubt the strong markets make enough to offset the losing ones.
$500 is the retail price (that's how much i paid for the xiaomi m365 they used to use). someone estimated that it's ~$300 per scooter, which i find more believable.
they are probably (unit) profitable (or operationally cabable of being so), otherwise, they wouldn't have raised a $300MM series C last year.
We've seen plenty of wildly unprofitable companies make it far past Series C. Lyft is on its 19th round and lost a billion on two billion dollars revenue in 2018.
yes, but the unit economics probably pencil out, meaning the direct costs of providing the service (distribution, charging, maintenance, and support) are paid for by the revenue. that’s unit profitability.
but they’re probably losing money in capital costs and overhead (marketing and the like), so overall unprofitable.
lyft was (is) principally both a hedge against uber and a way for VCs that didn’t get into uber (ever or early enough) to make a bet in the space (the top 2-3 companies in a new market usually survive to a decent exit), so profitability wasn’t an important metric for funding (but the probability of surviving to exit very much was).
At least you had to build a two-sided network. Without the driver, there literally is no barrier to entry, which is funny when you think about all the future rideshare "profitability" once you have self-driving cars...
On sale for US$410 retail right now, including shipping to EU (possibly from EU warehouse) if you choose the Fast-08 warehouse:
Don't use Gearbest. They're incredibly shady, and have terrible customer service. I've never had the issues that I had with gearbest with a vender on Aliexpress. Also Xiaomi even has a store on ali.
>they are probably (unit) profitable (or operationally cabable of being so), otherwise, they wouldn't have raised a $300MM series C last year.
Bwahahahaha, wooo, thanks for the laugh, I needed that after a long day!
Also, some of those are probably empty lots in places like NYC or Chicago where they can be better monetized once the land is rezoned, etc.
Last I heard lime was making $28 over the lifetime of a scooter.
If people weren't bad actors, I bet you a ride sharing company where you can just get into a car and drive around with it would make big money.
Just charge per minute and allow the owner to track the position continuously.
I bet you a ride sharing company where you can just get into a car and drive around with it would make big money.
I used ZipCar when I lived in Chicago and Seattle. Great service. Didn't need to own car in either city because of ZipCar.
ZipCar requires you to return the car to its original spot. With these scooter companies, you take it to where you want to go and leave it.
I've never used one of the Bird-type scooters, but I used to commute to the marina in SF on Scoot. It really was the most fantastic way I've never gotten to (and from) work.
Car2Go and ReachNow are two other similar services that let you leave the car in any legal parking spot. You can see available stock on a map just like these scooter/bike share companies.
How do you think rental car companies stay in business? You are still liable for the damage to the car if you blatantly abuse it, and you are still liable for property damage or accidents in states that require insurance and insure the driver.
This is just a car rental for a shorter amount of time. And in D.C. we had something called ZipCar which was pretty close to that.
When I was in the bay area zipcars were consistently driven by some of the worst drivers on the road.
It's like tourists in rental cars but worse, since these people often have never owned a car and drive very infrequently. I know people who never drove until their 30s then got a drivers license just to access zipcars. They're exceptionally bad drivers.
Right but it doesn't matter if they are bad drivers. They are still liable for damages and any accidents they cause. If you get in a wreck/get a ticket in a ZipCar, it is still your insurance that goes up, and points on your license, and you have to pay the ticket.
Which means nothing to the other drivers and pedestrians sharing space with these hazardous nuisances.
Personally I prefer these people use electric scooters than N-thousand-pound >100HP vehicles.
Is ZipCar no longer in DC? They’re in every state I’ve been to. I assume they’re in all of them.
Ah sorry if it came out that way, it is I that am no longer in D.C.
It works like at charm and since the early 90s in Switzerland
Alas, as a cooperative it's not profit oriented and there are certain restrictions, notably that vehicles are location bound and need to be picked up and returned at fixed stations.
That said, with a bit of planning it releases you from the dirty details of car ownership and this for much, much less money.
There are other ventures in the form as you describe it (private ownership loaned out). But to the best of my knowledge that never caught on. (German and French only)
Already very popular in Berlin, Germany with multiple companies fighting to dominate but the main one is DriveNow. Smartphone app opens the car, drive anywhere, park anywhere, pay as you go.
BMW, MB, and Lime already do this in Seattle.
It’s such a bad business model, it has nasty externalities, but people still leap to defend it because they don’t like cars. I think we need to be optimistic about this and accept that a lot of the last few years and probably a few more are all an incredibly expensive lesson as to why regulation exists, burdensome nature and all. Five years ago everything was “Uber for X” and “disruption” and Crytpocurrency. Now... not so much except for the true believers and the sunk costers.
So yes, it’s out of hand, it’s inherently unprofitable and cheap Chinese scooters are probably not a net environmental benefit. It’s still one of those things that millions of people apparently need to figure out the hard way.
Spoke to a (well known) VC who saw the Bird deal and passed... the gaps in the model would have been fairly obvious to any suitably critical person. Namely that Bird and Lime dont unite catchment areas thus the coefficient of the network effect is tiny compared to Uber.
Or you could have just looked at—-you know—-actual bike and scooter rental companies. They’re small mom and pop shops. No Hertz for scooters. There’s a reason.
I agree that the economics of scooter sharing are probably fucked but your last argument is like saying "look at cab companies, they're small mom and pop shops, this Uber thing will never take off"
Cab companies weren't mom and pop shops, though (at least not in the sense you're getting at). In fact, obtaining a medallion was a substantial investment ($1M+ in some cases). It's not particularly difficult to make the argument that scooters are a niche market at best.
That's in New York. In most areas, cabs were relatively marginal, little used services. Uber didn't take their market, it created a whole new market.
The rest of the country ain’t New York City.
No, I don’t mean to say that at all. The beauty of Uber is that it stitches together multiple markets on both the supply side of the marketplace and the demand side. For both small, medium, and large distances, riders know they will have a car and drivers know they will have a fare.
Bird investors failed to consider that this isn’t true for scooters. Each catchment area is isolated from the next.
Yes, I agree with your argument here. But comparing Bird to mom and pop bike rentals is wrong for the same reason that comparing Uber to traditional taxi companies (or comparing Cragslist to traditional classifieds, etc) is wrong.
Is Uber making money yet?
In major metros, yes.
I've said it before and I'll say it again, the only ones making money and going to make money are the manufacturers in China. VCs, U.S. or otherwise, are simply sending their LPs money there.
This is food delivery app, photo sharing app, social media app and so and so forth, all over again.
Don't forget meal kits. The unit economics never work for a startup with no infrastructure.
VCs will be fine. The real test will be after those companies go public.
Do you seriously believe public markets would be kind to these companies in the foreseeable future?
LA seems like it has 5+ car for every people too, so I'd rather see more scooters and less cars.
you reach your own, personal profitability when you lob off your cute startup on to the bigger fool
When I discuss with friends outside of Bay Area the electric scooters startups are one of symbols of Silicon Valley loosing the touch with reality.
Not saying they are necessarily not viable, just that is how the rest of the world sees us.
Here in Vienna there are three companies competing, with Bird having significantly reduced their radius of operation, it is practically unusable now. We have a few "startup-hubs" here and I don't think you can reach a single one by Bird, which seems like a bad strategy.
four at the moment (Lime, Bird, Tier, Wynd) and a few more in the planning (Flash, VOI, Arolla)
I have never even heard of Wynd, tried a websearch, DDG says it's either a Scottish poet or a small lane and Google says it's a portable air purifier. I think it's just called WIND?
you're right, it's a I https://www.wind.co/austria/
I love the scooters in Washington DC, and I don’t really mind that there are all these different companies. Eventually they will consolidate and will get two or three really good ones, and all will be great. Parking is miserable here, but it makes it more tolerable when I park six blocks from where I need to be, and scooter over.
I personally would love to see cities pouring funding into these scooter companies. For me, at least, they are infinitely more useful than the other public transportation options I have available.
These birds are out of control.
HR leaves the window open; pigeon lands, pecks at the Del key.