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The funding round valued the company at USD 400 million, a significant drop from the USD 2.4 billion investors priced the company at in a financing round last year. Officials from the company refused to comment on the valuation
Fremont, CA: Scooter rental company Lime secured USD 170 million in a financing round led by Uber Technologies. The new round of investment is a lifeline for the startup reeling from plunging customer numbers and company-wide layoffs. The investment round was also participated by Alphabet Inc., GV, and Bain Capital Ventures, along with other new and existing stakeholders. As part of the deal, Lime will acquire Uber's Jump bike-sharing business operations and the two companies will expand the integration of their mobile apps.
The funding round valued the company at USD 400 million, a significant drop from the USD 2.4 billion investors priced the company at in a financing round last year. Officials from the company refused to comment on the valuation. Venture capitalists have invested more than USD 1 billion in the last few years in two startups renting electric scooters, like Lime and Bird, but they began falling out of favor this year. First unprofitable business models fell out of fashion, and then the pandemic kept customers stuck at home. Both companies had to reduce their fleets by mid-March drastically.
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[vendor_logo_first]In January, the company announced that it was going to lay off around 14 percent of its staff, nearly 100 people, and retreat form a dozen markets in a drive toward profitability. In March, the company announced that it was winding down or pausing all operations in South Korea, followed by further layoffs in April.
Lime stated that Wayne Ting would replace Brad Bao as CEO. Wayne was earlier head of operations for the company. Brad will continue as chairman of the board. Global self-isolation measures and government bans on travel had decimated Lime's ability to generate revenue from the hundreds of thousands of scooters it has around the world. The company went from 147,000 scooter trips globally on March 14 to about 52,000 three days later as Europe went into lockdown.
Scooter companies are also suffering from a sharp decline in transportation spending and a newfound aversion to the sharing economy. This combination of factors also weighs heavily on Airbnb Inc., Getaround Inc., Lyft Inc., and Uber. Lyft stated Wednesday that it's cutting 17 percent of its workforce.
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