The race to release dockless electric scooters onto the streets of U.S. cities may be accelerating.
According to Bloomberg, Bird, the Los Angeles-based dockless electric scooter startup, is embarking on another multimillion-dollar funding round which would value the company at $1 billion dollars. For comparison, Airbnb, valued at roughly $31 billion today, took nearly three years to earn a billion-dollar valuation, a distinction so rare that companies with billion-dollar valuations are nicknamed unicorns.
The potential valuation shows just how competitive the market for this new transit option has become, and how venture-backed rivals are scrambling to scale so they can stay ahead of city regulations.
Bird, which is headquartered in the Venice neighborhood of LA, launched its app-based scooter system in September and has quickly expanded across the westside of Los Angeles, as well as into a handful of additional cities. According to founder Travis VanderZanden, who has spent several years at transportation tech companies, first as COO of Lyft and then as VP of driver growth for Uber, Bird plans to be in 50 cities by the end of 2018.
Competitors have scrambled to add scooters to new markets, and investors have encouraged them with sizable investments. Previous to today’s announcement, the biggest three companies—Bird, LimeBike, and Spin—had more than $200 million in venture capital funding and aggressive expansion plans.
The rapid expansion of dockless scooters has not been without pushback from city residents and local officials. Many have said these vehicles seem poised to—and in many cases, already have—run into the same legal and logistics issues that have plagued the speedy rollout of dockless bikes, including nuisance claims when bikes are dropped off and even discarded in inconvenient or out-of-the-way locations.
In December, the city of Santa Monica filed a criminal case against Bird, accusing it of operating without proper permits and owing more than $6,000 in fines. In January, the company agreed to pay more than $300,000 as part of a settlement with the city.
San Francisco officials, reacting to complaints that scores of the dockless scooters blocked sidewalks and impeded pedestrians, have introduced a number of restrictions; most recently, the city ordered the scooters to be removed from streets pending the start of a permit program later this summer.
The proliferation of scooters (and the chargers and mechanics who keep the vehicles running) has led many to talk about expanding multimodal transit infrastructure, and has even led some of these new startups to make pledges around corporate social responsibility and fleet management (such as Bird’s Save Our Sidewalks plan).
The market may soon become even more frenzied. According to the Bloomberg story, Lyft has looked at entering the business, and there’s speculation Uber is examining the opportunity as well.