Tuesday July 10, 2018

Uber Invests in Scooter Rental Company Lime

The New York Times is reporting that Uber has made a significant investment into the scooter rental company Lime. Lime was recently able to secure an additional $335 million in overall fund raising which elevated the value of the company to $1.1 billion. Uber has gained the right to display Lime scooters as a rental option in their app and some Lime scooters will bear the Uber logo. At $1 to unlock the scooter and $0.15 a minute to ride, the Lime scooter rental experience seems to be priced appropriately.

Uber's CEO Dara Khosrowshahi is positioning Uber as a hub of transportation activity so the cross-branding makes sense; but I have yet to see how either company is going to handle the problems with bike returns. In many cities where these bike and scooter rental companies do business, the customers aren't parking the returned vehicles properly. It has led to articles like this detailing the stacks of jumbled bikes in Dallas left by customers of Limebike and others. San Franciscans are not happy about this either. That all said, Bird Hunters have shown that scooter collection can lead to fun and profit.

Uber’s investment in Lime is part of a furious land grab in the transportation world. After Uber acquired Jump in April, Lyft said it was also getting into bike-sharing. Last week, Lyft said it was buying Motivate, the parent company of CitiBike and other similar programs in American cities. The financial terms were not disclosed, but media reports said Lyft was in talks to pay about $250 million for the company.