November is turning out to be a good month for the nascent e-scooter sharing market. Late last week, New York City issued an invitation for companies to offer by-the-minute rentals as from March 2021, while days later SoftBank’s technology-focused Vision Fund led a $250m investment into Tier Mobility. This latest round of investment raises the value of the Berlin-based e-scooter start-up to just under $1bn, making it the second most valuable e-scooter company in the world after Bird and ahead of Lime.
Tier Mobility operates in more than 80 cities in 10 countries across Europe and the Middle East and owes much of its success to its swappable batteries that can be easily and cheaply topped up on the spot, meaning that their e-scooters do not have to be pulled off the streets and shuttled to warehouses for recharging. The company also has a growing network of automated charging stations inside cafés and retailers. It is expected to use the new equity to diversify into other micromobility vehicles (the umbrella classification for any small, lightweight vehicle operating at speeds typically below 25 km/h) and to expand its charging network.
By investing in Tier, Softbank is signalling its confidence in the long-term future of the microbility market which fundamentally equates to a belief that commuters’ current quest for Covid-friendly alternatives to trains and buses will outlive the pandemic itself. By opting to back a European-based company rather than a US one, it simultaneously seems to be placing its bets on Europe rather than North America; but, as New York City’s call to tender suggests, the US market also has plenty of potential for growth.
Discouraged by the number of injuries and accidents blamed on their unregulated introduction in cities from San Francisco to Washington DC, the country’s biggest city took its time to give its blessing to e-scooter sharing, and it remains a conditional welcome. Manhattan is still off limits and the city authorities retain the right to rectify the obstruction of the public right-of-way, whether due to individual, improperly parked or fallen’ scooters, or an ‘excessive accumulation’ of them in any given place. They are also demanding access to all operating data and will determine the numbers allows on its streets.
The combined US, European and Chinese markets for e-scooter sharing are forecast by Statista to reach $12bn by 2025.