- Uber-backed scooter startup Lime and European challengers Tier and Dott have been chosen as the three companies that can operate electric scooter rentals in Paris.
- The city is set to formally announce the results of its tender on Thursday, but leaked emails seen by Business Insider indicate Lime has won a spot.
- German competitor Tier is also one of the permit winners, according to two sources with direct knowledge of the decision. Amsterdam-based Dott is another winner, according to one source with direct knowledge of the result.
- Paris was inundated with scooters until it decided to pick just three operators. The city is seen as Europe’s most profitable market.
- The decision will be confirmed on Thursday, but looks to be a loss for US scooter giant Bird which in 2019 spoke of plans to hire more than 1,000 staff in Paris.
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Lime, the scooter startup backed by Uber, has been chosen as one of only three companies that can operate electric scooters in Paris, which is seen as Europe’s most lucrative market.
The city of Paris is set to formally announce the results of its seven-month-long tender on Thursday, but leaked emails seen by Business Insider show that Lime, based in California, is among the winners.
German startup Tier, which recently raised $22.7 million in fresh funding, is also believed to have won a spot, according to two sources with direct knowledge of the decision. Amsterdam-based Dott is also a winner, according to one source with direct knowledge of the result.
Lime did not immediately respond to a request for comment from Business Insider.
The office of the mayor of Paris, Anne Hidalgo, declined to comment. Hidalgo launched the tender to reduce the number of scooters on the streets, after firms flooded the streets of Paris with rental vehicles.
Tier and Dott declined to comment.
Lime laid off more than 80 staff earlier this year after coronavirus hit the company’s revenues but has since received investment from ride hailing giant Uber. The $170 million investment was a de facto deferred purchase that slashed Lime’s valuation by 80%. Provisions are in place for SoftBank-backed Uber to buy the scooter startup in two years.
One source close to Lime said the company believed that turning around its image in the city over the past year was key to its success.
Paris is seen as Europe’s biggest market, and before the tender, scooters swamped the city. In 2019, the mayor said: “We need order and rules to assure road safety and to calm the streets, sidewalks and neighborhoods of our city.”
“It’s not far from anarchy and it’s extremely difficult for a city like ours to manage this kind of service,” Hidalgo added in comments to France 24.
Paris is key for scooter startups in part because the vehicles have, until very recently, remained illegal in the UK.
The Paris result appears to be a major blow to the ambitions of US startup Bird, which in 2019 announced plans to hire 1,000 staff in Paris. The fallout from the race could be vital to the future of the industry.
One Lime investor previously predicted that only two or three companies would be successful in Europe going forward, meaning M&A and consolidation is a distinct possibility.
Silicon Valley scooter startups continue to dominate the market, but European rivals are confident of catching up. US firms including Bird and Lime have attracted waves of venture capital funding, raising $623 million and $935 million respectively, per Crunchbase data.
Earlier in 2020, pre-COVID, Bird bought European scooter operator and one-time competitor Circ, and subsequently cut many of its former competitors’ staff, as well as some 420 of its own months later, to help streamline the business.
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