Lyft Takes over Ford GoBike

https://www.lyft.com/bikes/bay-wheels

by mikhuang • 7 years ago

143 160 7 years ago

After Lyft/GoBike removed all their electric bikes, SFMTA decided to expand dockless bikeshare so people can continue to commute by bikeshare.

But Lyft decided to sue instead: https://www.theverge.com/2019/6/7/18657312/lyft-bike-share-l...

kjksf• 7 years ago

As is their right.

The city fucked up hugely by making an exclusive deal with Ford/Motive (acquired by Lyft).

If you want to be mad at someone, be mad at SF government.

The rule of law means that you don't get to change contracts you've signed.

It was a bad contract but SF Government does many bad things, like repressive zoning and banning scooters.

Go vote them out of the office.

vkou• 7 years ago

The rule of law means that you don't get to change contracts you've signed.

Actually, contracts get broken all the time, and the only recourse you can get for that sort of thing is a lawsuit.

This is by design.

delfinom• 7 years ago

The rule of law means that you don't get to change contracts you've signed.

Technically you can if you wrote a clause allowing it or other conditionals. But we don't know the full contract and it's up to a judge to interpret it seems.

pensketch2• 7 years ago

You're painting Lyft to be the bad guys because they're suing. It seems like SFMTA is trying to weasel out of a contract. Lyft isn't trying to prevent people from continuing to commute by bikeshare; they're trying to secure their ROI on their Motivate acquisition through the exclusivity contract with SF.

Have you read the contract terms in the article you're linking to? SFMTA is saying the contract was for 'docked bikes only' while Lyft is saying it was for a Bike Sharing Program, which could include docked or dockless bikes. Lyft does a good job describing what 'Bike sharing' is in that document so it will be up to the courts to decide if they're right.

“Bike sharing” is a public biking system concept that allows customers to rent a bike on a short-term basis from one section of a city and leave it in another section of the city that same day.

The Term Sheet provided, among other terms, that Motivate was to be the exclusive operator of any bike share system in the Participating Cities for at least ten (10) years.

The Term Sheet provided (emphasis added): “During the Term of this Agreement, Motivate shall have the exclusive right to operate a bike sharing program that utilizes public property and public right of way anywhere within San Francisco, Berkeley, Oakland, San Jose and Emeryville.”

Larrikin• 7 years ago

What if I don't care whether Lyft gets their ROI and just want the best bike share possible?

AndrewWarner• 7 years ago

It's been tough to find a bike from them.

I've been a happy customer for years (first in DC and now SF), but ever since they removed their electric bikes, their docks have been empty so often that I can't count on using them any more.

jMyles3• 7 years ago

I'm not sure I agree that the city has the moral authority to grant a monopoly on such a concept.

I like Lyft just fine and I especially applaud their efforts to expand into ebike-to-transit. But I also have a little trouble feeling sorry for a company that feels it has suffered a loss because its out-and-out regulatory capture scheme didn't pan out as successfully as it hoped.

egh• 7 years ago

They removed the electric bikes only because of a safety issue. The non-electric bikes are still available. I haven't read anything about a relation to this event with a dockless bikeshare expansion.

baby6• 7 years ago

I wouldn't defend the SFMTA They make SF objectively worse by being pro car (no lime, bad public transports)

iso1337• 7 years ago

I like these commute options that make it easier to get around but starting at $2/ride seems a bit high. If I were to use this twice daily for 200 days a year, I'd be looking at $800/year! I'd rather buy a bike in that case, and just use the bikeshare for one offs.

I've never used a GoBike, but are those prices real & what are the typical usage patterns?

Edit: I see, there are monthly and yearly plans that make it much more competitive with ownership. Great!

samfisher83• 7 years ago

You can get monthly membership and it's free to take trips.

jdavis703• 7 years ago

There’s also a subsidy for low-income riders. I have my own bike, but it’s nice to hop on for a quick errand or if I’m going somewhere sketchy where I don’t want to leave my personal bike out.

superseeplus• 7 years ago

Citibike in NYC (also operated by Lyft) costs $2 per ride for using an ebike. And that is if you are already a member. Non members pay $5. There is no membership allowing unlimited ebike usage.

shereadsthenews6• 7 years ago

I have the annual membership. It's dirt cheap and the marginal cost is none. The day passes and single rides are intended for visitors.

umeshunni• 7 years ago

The last time I renewed, the annual membership was <$100

I decided to take the membership and use the bikes for short trips within SF. I figured I've saved more that $100 in Uber/Lyft rides in the last year (+ it's healthier, better for the environment etc)

robbyking2• 7 years ago

I'm an avid cyclist (I commute and race), so I didn't think I'd made much use of a bike share membership, but it's been amazing. Any time I'm out and about without my bike and need to get somewhere that's only a mile or two, I just hop on a bike share bike; I don't have to wait for a bus, or pay Uber/Lyft rates, I just go. My annual membership is less than $8/mo.

205guy2• 7 years ago

I've used these bikes in San Francisco several times on visits, they are great for getting around the downtown area. Public transit is 2.50 per ride ($3 cash starting July 1st), so it's cheaper as long as you are in their service area. The one thing is you're limited to 30 minutes before surcharges apply.

You used to only be able to purchase 1-day, 3-day, or 5-day passes, it was about the same price as long as you used it at least twice a day. At $2 per ride, it's much more flexible, so you can choose transit or bikes depending on the weather or whatever.

I see you've updated your post, but for completeness I'll list their plans (from https://www.lyft.com/bikes/bay-wheels/pricing):

Monthly no-commitment is $15 and you get unlimited 45-minute rentals. If I go work downtown for a week even, I'd get this. 45 minutes is great for a little after work exploration. When I'm in SF for business, I often bike somewhere after work (along the Embarcadero, Market street, South Beach, or around Chinatown), then drop off the bike, walk around some more, get food, then get another bike back to my hotel.

Edited to add: looks like they now have docking stations in the Haight-Ashbury, so you could get a bike to Golden Gate park, switch bikes, have 45 min around the park, and switch again to get back downtown.

Annual is $149 per year for unlimited 45-minute rentals. That is really cheap for a maintenance-free bike whenever you're in the city. I used to commute with my bike on Caltrain, and this would make it not worth the hassle (depends on how you get to your home station and how close your office is to one of their docking stations).

Also, monthly and annual plans might be paid for by your employer as part of your transit benefits.

rorykoehler• 7 years ago

I used to subscribe to mobike in Singapore but between poor redistribution and no maintenance whatsoever it quickly became a negative experience. Bike shares only work if they are dockless, well maintained and most importantly abundant throughout the whole service area at all times.

robotburrito2• 7 years ago

I cycle around SF constantly. However, I am very reluctant to actually leave my bike anywhere as it will more than likely get stolen. That is the reason I will use a bike share at times.

bredren• 7 years ago

I remember Lyft partnered with Ford on self-driving, but does that have anything to do with Lyft choosing to take this over? Bike shares seems outside the core-competency of Lyft. Is it simply for marketing?

I'm confused why the company would take this on as part of some larger strategic plan.

sparky_z• 7 years ago

"Go-bikes" were never run by Ford. It was a start-up called Motivate[0] that licensed the Ford brand for their bikeshare service. Lyft bought Motivate last year, and is just now getting around to the rebrand.

[0] https://en.wikipedia.org/wiki/Motivate_(company)

throwaway2873912• 7 years ago

Thanks for pointing that out -- I had no idea and it's really surprising to me. Why did they license the Ford brand? Is the Ford name really that attractive to the Bay Area bikesharing market? Would've expected it would hurt more than help, if anything. Is it just: all brand recognition is good brand recognition?

pensketch2• 7 years ago

Their mission: 'improve people’s lives with the world’s best transportation' allows for more than just cars and ride sharing. From what I've read recently, they also care greatly about being carbon neutral as well as embracing greener options for getting around. Bikes and eScooters seem to fit right into that plan.

lucasmullens• 7 years ago

Bike shares seem far closer to the core-competency of Lyft than Ford. Uber owns Jump, so this doesn't seem strange at all to me.

Yeaw• 7 years ago

and Ford owns Spin.

stingrae2• 7 years ago

Bikes and scooters will take many rides from ride sharing services. If Lyft wants to be a single source for all transit, they have to participate in micro-mobility.

ghoji• 7 years ago

A bike share being owned and operated by one of the biggest threats to cyclist safety is, well, it’s something.

hawaiian• 7 years ago

I see it as a good thing that will shine more light on cyclist safety.

jameslevy• 7 years ago

I would guess from my own experience as a frequent ride hailing passenger that Lyft/Uber drivers are less of a threat to cyclist safety on average than regular drivers.

shereadsthenews6• 7 years ago

Can't imagine how you formed that impression. TNC drivers love to perform the "Crazy Ivan" and they love to double-park in bike lanes.

kevincrane• 7 years ago

Except when they swerve and park in bike lanes.

kcorbitt• 7 years ago

I bike daily in San Francisco and that hasn't been my experience. My mental heuristics for risk to injury for me are, from least to most dangerous:

- City buses. Slow and predictable.

- Normal passenger vehicles.

- Lyft/Uber. Will often swerve right in front of me while they're pulling over. (Presumably because they're watching their phone to make sure they're dropping off in the right spot, or watching the sidewalk looking for their next fare.)

- Large pickup trucks. Not sure if it's the ride height that gives you the illusion you're further away or just a personality trait of their drivers, but a disproportionate number of my close calls are pickup trucks blasting by at high speed with no clearance.

- Old beater cars with dents/stuff falling off. These drivers can behave very unpredictably.

technotony• 7 years ago

The increased risk is passenger's opening the door right as you bike past or jumping out at a stop light or something. with cabs you know the risk so raise your awareness but with ridesharing could be anycar as you normally can't tell from the rear whose ridesharing.

robbyking2• 7 years ago

My wife used to work at a cycling advocacy organization that was often asked for feedback on bike share implementation, Ford included. I was skeptical, too, but what they told her was that they've already reached market saturation in urban areas, so if they want to grow their customer base, they have to look at forms of transportation that aren't automobiles.

tectonic• 7 years ago

My wife and I use Ford GoBike every day and are quite happy with it. It's probably the reason we still don't have a car.

ravenstine4• 7 years ago

That is until Lyft gets bored with it and axes it like Lime did to their bikes. Now my town is vacant if any rental bikes, despite their promise of fixing our "last-mile" problem to our train station.

shereadsthenews6• 7 years ago

The nice thing about the contract is they are obligated to provide the service.

bsder2• 7 years ago

That is until Lyft gets bored with it and axes it like Lime did to their bikes.

These seem to be be "docked". Wasn't Lime's problem that they were "dockless" and wound up being trash everywhere?

baby6• 7 years ago

I can't read this seriously knowing that cars take 1000000x more space

ravenstine4• 7 years ago

That might have been an issue, but Lime switched to the e-scooter game and probably found out that the bikes costed more in maintenance. The scooters last months before they break and probably need relatively simple parts for repair, but bikes probably broke constantly and it may have been hard to get enough people to repair them.

You could be right, though, and I'm only guessing.

badusername• 7 years ago

Ford GoBike have to be some of the worst, most ill-maintained bikes in the city. The product quality is terrible compared to the competition - half the bikes have mechanical issues, the electrical bikes were hazardous.

I was an early subscriber given how cheap it was, but I often struggled to find a bike that worked.

microdrum• 7 years ago

Another nail in the coffin of Bird?

stephencoyner• 7 years ago

I don't think so. On average, bike share trips are much longer than scooter trips (~1-3 for bikes vs ~0-1 for scooters) and e-bike trips are even further. With this in mind, I think it makes more sense to see scooter competition as walking than bikes or e-bikes.

Can't find the source I read this in originally, but will keep looking.

alpb3• 7 years ago

I was in SF this week and had a chance to try this out. They have 0 (zero) e-bikes despite their app has a column to list the count.

They also force you to pick up the bike from designated racks and drop-off at designated racks which is a pain in the ass.

On the other hand JUMP has a fully e-bike fleet, but bikes were impossible to come by. I parked a JUMP bike that had full battery. An hour later I came back and the app didn’t let me unlock it (reason unknown to me). It seemed like things are really glitchy.

I found the entire bikeshare situation in SF to be miserable, in brief. Scooters are no different.

It’s funny to see that Seattle were like this 4 years ago. Now LIME and JUMP dominate Seattle with fleets entirely consisting of E-bikes. They are super ubiquitous, and there’s no shortage of them, no “glitches”, and no need to park them at a designated rack.

holy_city2• 7 years ago

They also force you to pick up the bike from designated racks and drop-off at designated racks which is a pain in the ass.

I mean it's pain in the ass when I have to move the crap from the front steps of my building or out of the driveway because people aren't courteous their dockless transport widgets. I'm alright walking a little ways to dock a bike/scooter as a user, but I'm firmly against any company or city that lets users dump crap on the streets without penalties. It's littering.

alpb3• 7 years ago

Believe it or not, this doesn't happen in Seattle. Sure there was a month or two when people were treating bikes like shit, because they were new, but now the conventions have been established and people are more respectful. What you're worried about happens rarely in Seattle.

Assuming you live in SF, I'm not sure why you're not worried more about the people peeing on your wall, tossing their shoes or random garbage on your driveway more. Bikes being dropped off at a public sidewalk sounds like less of a problem than these.

8ytecoder• 7 years ago

Even worse when someone in a wheelchair can’t get to the train because people can’t bother to put it back in their designated spots allotted to them in the station plaza. It’s 10 feet away literally.

baby6• 7 years ago

You're talking about cars right?

cgati2• 7 years ago

The Ford e-bike fleet got pulled due to some bikes experiencing too strong a braking force on the front wheel. They've been working on a redesigned e-bike and that will be coming soon.

iaresee2• 7 years ago

The Ford e-bike fleet got pulled because $15/month for unlimited access to e-bikes was untenable and the few, bad bikes was good cover to pull them.

When they come back they'll be $3 for the first 20 minutes just like the Uber bikes in SF now.

jessriedel4• 7 years ago

some bikes experiencing too strong a braking force on the front wheel

Was that actually confirmed or just alleged?

zippzom• 7 years ago

This hasn't been my experience at all. There are almost always e-bikes at the Ford stations (per the other comment maybe this was a one off issue) and the Jump bikes work just as well in SF as Seattle in my experience (no shortage of glitches in Seattle).

shereadsthenews6• 7 years ago

There haven’t been ebikes at any station for several weeks because they pulled them all over a front brake failure. They also pulled them in NYC.

yks• 7 years ago

Jump bikes strongly follow commuter pattern, e.g. if you're going downtown in the morning or back at 5pm, you won't find any but if you're doing the opposite (or midday ride downtown) then, of course, Jump bikes are plenty.

alpb3• 7 years ago

Might be. I experienced no e-bikes for 4 days in a row while I was there just now. I also saw a ton of people using GoBikes during this period, none were e-bikes.

JUMP bikes in SF didn’t work for me most of the time. I would see one, but it wouldn’t let me take it. It worked about maybe 2 out of 6 times I tried. And as I said, the one I just locked with full battery and came back after an hour just wasn’t unlocking without a reasonable error message either. It makes me think there’s a secret reason they don’t let people unlock the bikes (they also don’t show up on the map).

jacquesc• 7 years ago

It's the SFMTA's fault. They were way too conservative with ebikes launches. Signed an exclusively contract with a company that couldn't deliver. They shut down most of the scooter shares. And Jump bikes (the best option in my opinion) hasn't been allowed to expand so they're nearly impossible to find. You can look on a map many evenings and not find a single Jump bike in SOMA.

End result, people going back to Uber/Lyft to get around. Shocking that traffic in SF is as bad as it's ever been.

joering2• 7 years ago

I recently read that Uber/Lyft keeps even 75% of money for themselves. I wonder if there is an opportunity for third large ride-sharing app where business model would be based on bidding and company would keep much lower fee, just to cover overhead. So you want to go from point A to B, all local drivers are contacted and they have 45 seconds to bid who would charge less. Requester would see how much sorted by less $ and also ratings so he/she can chose someone more expensive but with better ratings.

Such model would kill Uber/Lyft overnight - they would not be able to adjust to that model because then their stocks would be cut down 95%. However, it is a win-to-win situation to both drivers and ride-takers - drivers get paid more and more stays in their pocket, while takers can chose if the ride is affordable, and at over 50% cheaper than what Lyft/Uber charge, it sure would be!

thehappypm• 7 years ago

You're getting downvoted because this is both a bad business idea, and a bad product idea.

Uber and Lyft have proven that drivers and riders don't want to think particularly hard. They want a magic button that either a) makes a car show up or b) feeds them customers.

As for the business side, there's no good reason to think that this would even cut costs on Uber's side -- they still need to maintain all of their lobbying costs, their server and engineer costs to maintain the bidding app, their marketing costs, etc.

robotburrito2• 7 years ago

Why doesn't the city just run it's own scooter/bike share? Seems like it would exist in the same domain as things like MUNI and in theory would allow the city to make a profit instead of LYFT/UBER etc.

streblo• 7 years ago

Because they can let Uber/Lyft/et al do it, charge them a tax, and have none of the operational overhead or expenditures.

shereadsthenews6• 7 years ago

Motivate isn’t exactly rolling in money. It’s essentially a non-profit.

sushid• 7 years ago

Clearly you haven't taken the MUNI on a regular basis. The last thing we need is an incompetent government agency taking over yet another method of transportation.

ilikehurdles• 7 years ago

Some cities do. Denver has Denver B-cycle, and they are giving out 5280 free annual passes this year (not sure if they do this every year). The non-free option is still a fraction of the costs of the for-profit private companies. There are also a plethora of e-scooter brands though and I see them more often than bikes.

Boston has Bluebikes (e: seems like it's a partnership with Motivate?), also pretty cheap. A lot of people I knew in Boston had some kind of discounted rate through their employer where they got unlimited complimentary 30-minute rides.

truebosko• 7 years ago

I pay $50 CAD a year for bike share across Toronto. This seems pretty expensive, to be honest.

EForEndeavour• 7 years ago

How are you paying $50/year? Bike Share Toronto costs CAD$100/year. If you took advantage of their Presto card discount, that used to be 50% off for the first year of membership, recently reduced to 30% off the first year: https://bikesharetoronto.com/presto/

Bike Share Toronto is heavily subsidized by the city and Ontario, and operates at a loss: https://www.thestar.com/news/city_hall/2019/02/28/bike-share...

campl3r• 7 years ago

I pay 39€ a year for unlimited 30 minute rides in about 8 German cities. electric is extra and has sadly a very limited availability.

vajaya2• 7 years ago

I wonder why bike sharing is still a thing in business world. Hasn't this business venture been proved to be a fiasco in China, where user base is larger in magnitude, operation cost is residual and virtually no regulation friction, compared to the u.s.? Why do lyft, uber and others think it is viable(profitable) in the u.s.?

Another thing beyond me is although the business model/development of this kind seems to be bound to fail, why they are still chased by enormous amount of capital.

My cynical suspicion is these so call tech start ups are just instrument of a grand new ponzi scheme in which a bunch of investors use borrowed money(from banks, insurance company and the likes) to set up a start up and increase the value of it(manufacture hype to justify the inflation along the way) and the sell to public, which is mainly pension funds, 401k, government backed institutions and so one, that is, ordinary folks.

I hope someone would correct me and shed some light on this matter.

fuzz4lyfe• 7 years ago

My thoughts exactly. Tech companies going public will be the credit default swaps of the 20's, mark my words.

woodruffw3• 7 years ago

My 0.02c as a Citi Bike (NYC's bikeshare) subscriber: I wouldn't be surprised if there's a modest profit to be made in bike sharing, at least in NYC. I know quite a few people with a yearly subscription (either personally or via their employer), and I would consider paying for one personally now that I've experienced their convenience. I don't know how much money Citi Bike/Motivate actually makes here, although AFAIK they don't receive any public subsidies (other than free use of public space).

OTOH, I don't think that the e-bike/scooter companies will ever be profitable. I wouldn't be surprised if the people running those companies are equally cynical.

vajaya2• 7 years ago

I don't have their unit economy data, but I'm still (stubbornly) skeptical of the profitability of bike sharing. One reason is the market depth, in the sense that most of the time it's just young, educated and often bourgeois people in metropolis, which is a tiny proportion of people, who ride bike for purposes other than recreational.

andrei_says_• 7 years ago

Public transport, like public roads, healthcare and education, are critical to the viability and profitability of almost any other enterprise. As such, it is logical to subsidize them and take profitability out of the equation.

This works very very well for first world Western societies.

g_sch3• 7 years ago

I think bikeshare programs have been very successful in cities where they are monopolies and partially run by cities. My experiences with bikeshares in NYC, London, Hamburg, Berlin, and DC have all been great.

The places where they have become nuisances are largely those that have been flooded with multiple competing (usually dockless) systems, because it turns out that you don't need a large capital investment to create a lot of junk sitting idle that gets in people's way.

I think bikeshare systems should be municipally owned (or at least municipally regulated). For me, the real killer app would be one that lets me get a bikeshare in any city.

thatfrenchguy• 7 years ago

I absolutely don’t understand why cities let their streets be literred for free by dockless bikes. I really hope at least the politicians involved got a kickback :-/.

2T1Qka0rEiPr2• 7 years ago

Just on this - Hamburg in particular has a system where it's free to use for up to 30m for subscribers to the service, which is super cheap.

I believe it's run by the local authority, and at such a level its easy to explain why it's much more likely to be economically viable. The state also has to deal with the externalities associated with other forms of transport (traffic, noise, pollution etc.), as well as the health consequences of its citizens. Additionally, it's not-dockless - which I think massively reduces the nuisance on everyone else.

toomuchequate2• 7 years ago

Same.

Lots of dumb money in the market too. Reminds me of Crypto before each collapse.

3xblah• 7 years ago

"I hope someone would correct me..."

s/grand new ponzi//

The capital is cheaper than ever and so is the hype.

modo_• 7 years ago

I struggle to justify the purchase as a whole, but I think one component of the value a company like uber or lyft gains from an acquisition like this is to have a stronger stake in my transportation mindshare.

If I'm opening their app regardless of which transportation method I end up using, I'm more likely to keep coming back and will frequently choose to move up a tier (scooter -> bike -> car) if the price is "just a few dollars more".

It's worth considering the data component as well -- there's a tangible benefit to knowing which mode of transportation people are choosing for which trips.

nneonneo• 7 years ago

Bike sharing is still a thing in China, but they’ve definitely scaled it back. It was getting a little out of hand with hundreds of yellow bikes per city block, half of which were broken, littering the streets. The newer generation of bikes are also more robust, making it less likely for the bike to be unusable. On a recent trip to Beijing I still saw a healthy number of people riding the shareable bikes.

gnopgnip• 7 years ago

People in the US have more disposable income. In some cases there is less competition in the US.

throwaway66666• 7 years ago

Without knowing the actual logistics, just speaking as a user. I see bike sharing being somewhat popular where I currently live (SF -- mostly JUMP bikes. Not sure about GoBike, the bright red jump branding is too "eye-grabbing" to ignore). I have no idea if it can be profitable or not, but as an end user it is a nice option to have!

Maybe lyft wants to use it to strengthen their brand perception. They have bikes too = they are environmental friendly! Also play the marketing illusion that they are everywhere, as essentially people will be moving around the city riding lyft branded bikes.

r_singh• 7 years ago

Was reading about some bike sharing startups in India raising millions of dollars (Altero ~$3.5M, Rapido $50M) and felt the exact same thing today morning.

arcticbull• 7 years ago

Stepping back a sec, there's "classic" bikeshare (docked, manual), then there's (docked, electric) and (dockless, electric). Each of these has different pros and cons, though I agree docked, manual bikes aren't great.

Dockless, electric is a game-changer. JUMP bikes hit 20MPH in a few seconds, take less effort than will get you sweaty (critical for meetings/commuting) and you can take the bike lane. Then the vast majority of the time you just hook it up to whatever chunk of metal is nearby and you're done. It's the fastest way between almost any 2 points in SF and often the most convenient too.

At $2 for 30min + $0.07/min it was an absolute steal. At $3 I may have to think harder but if it makes the economics work, I'm still in. I basically stopped using Uber and pay $5-7/day for all the electric biking I need. Could I buy one for a years' fees? Yep. But I don't want to deal with the hassle of owning.

cbhl• 7 years ago

What I don't understand is that Lyft is suing the city of SF.

It literally should just take the Ford GoBike stations, and convert them into bike parking for only their brand of "dockless" bikes. Even if they don't have exclusivity over dockless bikes, having a monopoly over dedicated parking spots would make their brand of dockless bikes way more convenient.

Instead, scooters have taken over the city instead.

jillesvangurp• 7 years ago

The money in this market is in subscriptions. Recurring revenue from just a small percentage of all possible users can pay for a lot of bikes and it's pretty reliable revenue as long as you don't alienate customers too much.

I've been a Mobike subscriber for a year now (in Berlin). The bikes are crap (i.e. cheap, in need of maintenance) but they are everywhere and I see it as saving on gym cost (hard work to ride one). But, if I need to get from A to B, I get one because I already payed for it. I probably payed them around 100 euros or so over the last year. I just renewed for 3 months for 24 euros. Every time I do this the price seems to change. This gets me unlimited 30 minute rides. After that they charge 1 euro per additional 30 minutes (tip, lock and unlock seems to work). I consider this good value. I don't have to worry about bike repairs, bike theft, or leaving my bike in a dodgy area. As soon as I lock it, it's not my problem.

I've done over 1200 km on mobikes in the last 12 months. Even in the winter when the weather is less nice, I still used them enough to make it worth the subscription.

The back of the envelope math is pretty interesting. If you have 10K users like me that's about 1M revenue. For a city like Berlin (4M inhabitants), you can probably do better. At 100 euro per bike, 1M buys you 10K bikes. I have no idea what these things cost per year but both the upfront investment to flood a city with bikes and setting up the support organization (maintenance mainly) are not that high. I'd say if they shoot for recurring revenue from around 20K users in a city like this, they ought to be very profitable. They have plenty of capacity to improve utilization as at this rate most bikes are not in use most of the time.

The main issues I've seen with competitors is that they think too small. Something like Mobike only makes sense if you can find one without effort. A lot of the failed startups in this space did not have enough bikes or too complex bikes (they break). Launching with a few hundred bikes is pointless. Everybody that did this in Berlin is gone (ofo, byke (with a y), lime, etc. Mobike did this right. They flooded the city with between 5K and 10K bikes. They are all over the place. I suspect the bulk price for these things is pretty OK. The main challenge is the growth strategy: they need recurring revenue.

I suspect Jump, which recently re-launched here, won't make it in Berlin because they don't do subscriptions, their operational zone is tiny, and they don't have enough bikes on the streets. The value proposition kind of sucks compared to Mobike.

Mobike looks like it might fail because their bikes are deteriorating and they seem to be in limbo now that their China based headquarters looks like they want to focus on just China. Apparently they are looking to sell off the European operations. I think it's an operation worth saving but it is going to take an investment to keep their existing user base and there's a bit of urgency because the experience is getting worse as the bikes get shittier.

The only way to mess this up is poor execution. There seems a lot of that in this business. But it's not an inherently bad business.

nielsole• 7 years ago

There is already people who make money off of bike-sharing: https://www.northdata.de/nextbike+GmbH,+Leipzig/HRB+21178

Just not the big names

Jonnerz4• 7 years ago

Nextbike have some very shady business practices. Don't ever have a negative balance with them. They won't tell you and will proceed to threaten you with legal action a year later. Happened to me over £3 (which later became £10 as they don't accept payments below £10).

They also don't comply with GDPR. After confirming several times they have completely deleted my account and any reference to my email, I still get marketing emails from them every now and again.

gpapilion• 7 years ago

The unit costs from Lyft’s S1 showed that bikes and cars were roughly equal revenue to Lyft on a per ride basis.

devit• 7 years ago

The service is valuable since it reduces travel times for those using public transit and those going to place near their homes by replacing walking.

Hence, as long as vandalism is not too much of a problem and thus the service can be provided cheaply, it should be profitable.

There is also a natural moat since once you are subscribed to the service with the most bikes you have an incentive to stick with it.

eloff• 7 years ago

I use docked, manual bikes in the city of Vancouver. It costs less than the bike storage fees in my building for unlimited one hour trips (and for longer trips you just dock and undock again.) So I sold my bike long ago and just keep using the bike share system. It's faster than a taxi to get around downtown. Pretty useless in the winter though with all the rain.

chungleong• 7 years ago

I think ideology plays a larger role than profit. Many people in the American financial world are Randian extremists. They like various "sharing" services because they operate outside regulatory frameworks.

mo1ok• 7 years ago

FWIW, I know of a bike sharing startup that found profitably by charging cities and municipalities for the service as an urban amenity.

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