INSUBCONTINENT EXCLUSIVE:
Yesterday, we learned that 18-month-old, Bay Area-based electric scooter rental company Lime is joining forces with the ride-hailing giant
Uber, which is both investing in the company as part of a $335 million round and planning to promote Lime in its mobile app
According to Bloomberg, Uber also plans to plaster its logo on Lime’s scooters.Lime isn’t being acquired outright, in short, but it
At least, Uber struck a similar arrangement with the electric bike company JUMP bikes before spending $200 million to acquire the company
in spring.There are as many questions raised by this kind of tie-up as answered, but the biggest may be what the impact means for Lime’s
fiercest rival in the e-scooter wars, 15-month-old L.A.-based Bird, which several sources tell us also discussed a potential partnership
with Uber.Despite recently raising $300 million in fresh capital at a somewhat stunning $2 billion valuation, could its goose be, ahem,
cookedAt first glance, it would appear so
Uber’s travel app is the most downloaded in the U.S
by a wide margin, despite gains made last year by its closest U.S
competitor, Lyft, as Uber battled one scandal after another
It’s easy to imagine that Lime’s integration with Uber will give it the kind of immediate brand reach that most founders can only dream
about.A related issue for Bird is its relationship with Lyft, which
Bird’s founder and CEO, Travis VanderZanden, burned that bridge when, not so long after Lyft acqui-hired VanderZanden from a small startup
he’d launched and made him its COO, he left to join rival Uber.Lyft, which sued VanderZanden for allegedly breaking a confidentiality
agreement when he joined Uber, later settled with him for undisclosed terms
But given their history, it’s hard to imagine Lyft — which also has a much smaller checkbook than Uber — paying top dollar to acquire
his company.Where that leaves Bird is an open question, but people familiar with both Bird and Lime suggest the e-scooter war is far from
over.For example, though Uber sees its partnership with Lime as “another step towards our vision of becoming a one-stop shop for all your
transportation needs,” two sources familiar with Bird’s thinking are quick to underscore its plans to expand internationally quickly
and not merely fight a turf war in the U.S
(It already has one office in China.)That Sequoia Capital led Bird’s most recent round of funding helps on this front, given Sequoia
Capital China’s growing dominancein the country and the relationships that go with it
Then again, Sequoia is also an investor in Uber, having acquired a stake in the company earlier this year
And alliances are generally temperamental in this brave new world of transportation
In just the latest unexpected twist, Lime’s newest round included not only Uber but also GV, the venture arm of Alphabet, which only
recently resolved a lawsuit with Uber.Another wrinkle to consider is the exposure that Lime receives from Uber, which could prove
double-edged, given the company’s ups and downs
Uber’s new CEO, Dara Khosrowshahi, appears determined to steer the company to a smooth and decidedly undramatic public offering in another
But for a company of Uber’s scale and scope, that’s a challenge, to say the least
(Its newest hire, Scott Schools — a former top attorney at the U.S
Justice Department and now Uber’s chief compliance officer — will undoubtedly be tasked with minimizing the odds of things going
astray.)Lime’s arrangement with Uber could potentially create other opportunities for Bird
First, by agreeing to allow Uber to apply its branding to its scooters, Lime will be diluting its own brand
Even if Uber never acquires the company, riders may well associate Lime with Uber and think, for better or worse, that it’s a
subsidiary.Further, Uber does not appear to have made any promises to Lime in terms of how prominently its app is featured within its own
mobile app, which already crams in quite a lot, from offering free ride coupons to featuring local offers to promoting its Uber Eats
business.Consider that in January 2017, Google added to both the Android and iOS versions of its Google Maps service the ability to book an
Uber might have thought that a coup, too, at the time
But last summer, Google quietly removed the feature from its iOS app, and it removed the service from Android just last month
If there wasn’t much outrage over the decision, likely it’s because so few users of Google Maps noticed the feature in the first
place.Lime’s arrangement could prove more advantageous than that
But everything considered, whether or not Bird flies away with this competition will likely owe less to Lime’s new arrangement with Uber
than with its own ability to execute
That includes making its own mobile app the kind of go-to destination that Uber’s has become.Certainly, that’s what Bird’s flock would
Yesterday afternoon, Roelof Botha, a partner at Sequoia and a Bird board member, declined to discuss the Lime deal, instead emailing one
short observation seemingly designed to say it all: “Travis [VanderZanden] is far more customer obsessed than competitor obsessed
That is a quality we look for in great founders.”A Bird spokesperson offered an equally sanguine quote, saying that Bird is “happy to
