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.
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.
https://oversharing.substack.com/p/shared-scooters-dont-last...
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"?
https://www.theatlantic.com/photo/2018/03/bike-share-oversup...
[0] https://oversharing.substack.com/p/shared-scooters-dont-last...
they are probably (unit) profitable (or operationally cabable of being so), otherwise, they wouldn't have raised a $300MM series C last year.
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).