Genuinely interested in how such business is able to make a dime.
I dunno, they're all over the place and people seem to love them. For getting around a city center they're more convenient to rent simply because most of your destinations won't have a good solution for storage. You can pull up right to where you want to go and when you're ready to leave can usually find another one within a block or two.
In china, Mobike charges $1.58 per month for unlimited* trips on their ridesharing bikes. Given how their bikes cost ~$100 each, and how they operate millions of bikes, they are losing massive amounts of money.
Investors have the same mentality (once we are a monopoly, we can charge more) but until then they are incinerating cash.
*Mobike rides have the first 2 hours of each trip free. If you stay on longer you need to pay. However, you can just switch bikes after 2 hours to avoid the fee.
That hasn't been my experience with Mobike. When I had a paid membership, I got 2 hours cumulative for free over a month. Didn't matter how many different bikes I used, it was cumulative. Once that was up, then I'd be charged additional fees.
I wonder how much money Mobike makes from people who forget to lock their bikes. I've given them something like ~$50 so far because I keep forgetting to lock my bike and then don't notice until later after someone has been riding my rented bike for free for a number of hours. Once I realize what happened, I notify them, and then they lock down my account and won't unlock it until I pay up the racked up fees.
Maybe you are thinking of a different promo? Here’s the one I’m thinking of https://mobike.com/sg/blog/post/mobike-pass
This promo is for Singapore, it’s the same promo as China just in English. In this promo Mobike is offering unlimited free rides (<2hrs) with no deposit for $0.63/month. It says you can switch bikes to reset the time.
They are running this far below cost. I can’t see how Mobike makes any profit off this.
The bigger question here is whether people will adopt scooters when they are more comfortable on bikes.
If you, say, used one to get to & from work on a commute of a few miles you'd break even on buying your own scooter pretty quickly.
The big advantage is not having to deal with storing or charging the scooter, ever.
In Santa Monica & Venice there is usually a Bird or two within a block of you at all times.
“I know. Scooters. They cost money, right? And it’ll need a ton of marketing!”
In the UK any one who got their driving licence after 2001 must pass the CBT before they can ride a scoter and that's limited to 50cc
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[1] I want to say I paid something like ~30 USD, but this was ~10 years ago. Unlike a standard vehicle, however, there is no inspection check pre-requisite for safety nor emissions. I think the fee is purely for tags. Helmets are definitely a requirement though.
[2] AFAIK there are no additional insurance requirements though. There weren't any ~10 year ago when I one, but I can't remember if that's because my comprehensive car insurance did double-duty in the event were I to, say, hit a pedestrian in a crosswalk and they were to sustain damage.
75 USD - 90 USD for a Bike (https://m.alibaba.com/product/60710077310/export-EU-standard...)
1 USD - 25 USD for the remote lock (https://m.alibaba.com/product/60623794401/GPRS-Bluetooth-Cho...)
At this scale I wouldn't be surprised that they could get a whole painted bike + the lock + all the importation costs and taxes for 100 USD (maybe even less).
One ride costs 1 USD... That means they just need 100 rides to break even on a bike... If they get an average of 1 ride per bike in all their fleet (which is low imo), they just need 100 days of operation to break even on all their fleet. (These calculations don't take into account the operational costs, but you get the idea. As you grow and start creating more network effects and gaining economies of scales these costs will only grow linearly).
According to Seattle City Data, the average ride per bike here is something around 0.6 rides per bike (daily). That would likely improve again once it starts warming up.
Now regarding the Scooters, you could do a similar analysis. I was able to find foldable electric scooters at very cheap prices in bulk (45 USD, 80 USD, 70 USD, 120 USD, etc...). So it's also technically possible to break even very fast with scooters as well -> https://www.alibaba.com/trade/search?fsb=y&IndexArea=product...
Finally, there are more angles to a business like this. There's a huge component which is gov subsidies. Local governments love this crap and I can totally see them paying these companies for providing a reliable alternative transportation. Another angle is just plain cheap advertising. You can basically wrap these crappy bikes and scooters with ad decals. You could also monetize based on geo-location and sell contextual ads as well as selling the data to brands.
You also made other good points like why wouldn't someone simply buy a scooter. What's appealing about this model is that you can just leave it anywhere. You don't have to get worried about this thing getting charged, or someone robbing it or vandalizing it. You use it when you need it and you continue with your life. Owning one adds an incredible amount of burden to something as mundane as moving from point A to point B.
In Seattle there are crews of people moving bikes around, usually from downhill areas to uphill areas. The public transportation & rideshare is good enough that many people are using bike shares for one way rides. Alternatively E-bikes might be used for the uphill half of the trip. The overhead of paying people to collect and move bikes doesn't scale the same way that app development and brand recognition does.
I would really like to see the numbers on how many bikes are relocated before reuse, as well as numbers on how often bikes are stolen, damaged, or lost.
I love biking, and I like the energy in urban biking that bike sharing is generating, but I am very bearish on the business of bike sharing.