Lime take on Uber’s Jump e-bikes and rake in $170M
The Covid-19 craze claims yet another victim as the micro-mobility market seeks consolidation. Scooter and bike-sharing company Lime managed to convince Uber and Google’s alphabet to lead a financing round over $170M.
In return for their money, Lime takes over the e-bike and e-scooter business from Uber under the Jump brand. This will help Uber to write off a sizable portion of its cash losses. Besides, Uber had already been involved in Lime before and is therefore only adding to its minority share. However, none of the companies disclosed the size of the new stake.
The ride-hailing business is not the only one to suffer, of course. Lime itself is now valued at $510 million after the new deal, a 79 per cent drop from its previous valuation as The Information notes.
The company had pulled its fleet of electric kick scooters from 99 per cent of its markets worldwide when the pandemic took hold as reported. As a result, the company has now laid-off 13 per cent of its global staff, not counting numerous contractors. Also Uber had announced this week that it would cut 3,700 jobs, about 14 per cent of the workforce.
For Lime though, the lay-offs, follow financial problems that already surfaced in January when Lime announced it was withdrawing from twelve cities due to lack of profitability.
With the new funding, however, Lime hopes to continue. The newly-promoted Wayne Ting, now Chief Executive Officer, said in a statement that “micro-mobility will be vital to the new world affected by COVID-19 and we are already seeing this as cities begin to move again”.
Once transport indeed begins moving again, drivers will be able to rent Lime’s scooters in Uber’s app, and vice versa with Uber’s Jump bikes and scooters in Lime’s app as before.
Neither Lime nor Uber are alone with these problems though. The sharing business as a whole has taken a huge hit. Bird went on pause in Europe at the beginning of April. The company also made 30 per cent of its workforce redundant at short notice. 406 of 1,387 employees had to leave. Unlike Lime, however, Bird’s capital was expected to last “well into 2021”, partly because of the redundancies.
Sweden’s Voi had also closed down its services in “most of our cities”. According to the company, it still has “a solid financial base until 2021”, but will lay off some of its employees. On the latest count, Voi was operational in Stockholm, Gothenburg and Uppsala in Sweden as well as Oslo and Helsinki. Also in Copenhagen, people may take a little e-scooter for a ride again.