It’s Not Too Late to Turn the Electric Scooter Industry Around - CityLab
Micromobility companies like Bird and Lime have laid-off workers, left markets, and scrapped vehicles in recent months. But these two industry insiders see a way forward for more-sustainable shared transportation.
The Covid-19 pandemic has served up a cruel paradox for the micromobility industry: Even as urban residents need more socially distant ways to get around, the companies offering shared bikes, e-bikes and e-scooters have laid off staff and abruptly pulled out of markets. Since 2020 began, companies like Lime, Bird and JUMP have shed upwards of 1,000 jobs and scrapped several thousand e-bikes and scooters, all at a time when two-wheel transport is being called a critical lifeline. Little wonder that many transport officials and mobility enthusiasts are now questioning if shared micromobility in its current venture-capital-funded form is truly a sustainable solution worth supporting.
Having served as sustainability directors at two of the leading micromobility companies, Bird (Melinda) and Lime (Alison), we’re familiar with the processes and pressures that drive these business decisions. Indeed, both of our roles — along with a variety of public policy and community engagement positions — were eliminated earlier this spring. But we still strongly believe that shared micromobility has the potential to dramatically reduce car trips, shrink carbon emissions and improve transport equity.
It’s not too late to get this industry on track. To reach its potential and move forward on a more sustainable path, both companies and cities have roles to play. Given our unique view behind the curtain, here’s how we think it could happen.
Diversify leadership Micromobility companies operate in diverse cities and in the public realm. But executive teams and boards lack diversity across gender, race, physical ability, geography, background, and expertise, leaving micromobility companies ill-equipped to meet the needs of the diverse people and cities they serve. Diverse leadership, according to research, leads to increased innovation and better business outcomes. A variety of perspectives are necessary to ensure companies consider holistic business impacts on city residents, local officials, employees, workers and the environment.
Diversity can help ensure social and environmental goals are part of the decision-making process up front, and might have helped the industry avoid its more damaging mistakes. A transport policy voice at the table may have stopped the early practice of deploying hundreds of scooters on city streets without permission. A sustainability voice might have discouraged the decision to deploy thousands of consumer-model scooters that broke down after just a few months, a narrative and figure that has been difficult for the companies to shed even with substantial hardware improvements. And a leader well versed in community engagement could have partnered with cities to design equity programs that improve mobility access in historically underserved neighborhoods and meet city needs without overburdening operators. These early missteps soured relationships with cities which, in turn, brought on tougher regulations that ultimately decreased revenue.
Embrace ESG goals Investor interest in companies that embrace environmental, social, and governance (ESG) factors has skyrocketed in recent years. Companies with clearly defined ESG focus areas — such as pro-social employment practices and sustainable/resilient supply chains — outperform their peers and have retained market value during the downturn. Micromobility companies are quick to highlight social and environmental benefits provided by their service, but their actions demonstrate these are not always a central business priority.
Micromobility operators should understand that a deeply embedded commitment to environmental and social goals — aligned with city objectives — builds trust and reduces business risk. When cities see that operators are reliable partners who are helping to achieve their mobility goals, officials will be more inclined to grant long-term permits with more business-friendly operating terms. To get there, companies need leadership and incentives to broaden the short-term focus on margins and growth, orient toward company-wide ESG metrics, and embrace transparency. Such incentives and metrics would help ensure environmental and social impacts are considered in business decisions, setting these companies up for long-term success and attract ESG-focused investment.