KEY TAKEAWAYS
  • Bike sharing businesses are competing for geographical expansion in a growing market characterized by urbanization and congestion.
  • Recent shifts in the bike sharing experience, such as the move from docked to deckles bikes and motorization, suggest we may have not yet seen the final product.
  • Bike sharing is data sharing. Opportunities for bike-linked data to solve internal problems (such as optimal bike allocation) and find new partnerships and applications still abound.

The sheer number of rides speaks volumes for the popularity of bike-sharing with consumers. Today, more than 40 companies offer dockless bike share services in China. The top two alone, Mobike and ofo, handle more than 50 million rides every day [^1]. As of April 2018, ofo claims to operate in 21 countries and over 250 cities while Mobike operates in over 190 cities across China, Singapore, Italy, Japan, the U.K., and U.S. Bird and Lime, two California-based e-bike companies, are both in 100 cities.

Bike-sharing is also opening up welcome new opportunities in the gig economy. Bird pays freelance “bird-hunters” between $5 and $25 for charging one of its e-scooters, depending on how hard it is to find. Charging mostly happens at night and the vehicles must be back on the street in specified locations before 7 a.m. the next day. For the budding entrepreneur, crowdsourced local deliveries and logistics is another emerging gig on e-bike platforms.

However, bike-sharing is not completely without its problems. Haphazardly parked bikes often result in stacks of bicycles in the streets and annoy citizens. Several Chinese cities are investing in more bicycle parking bays to avoid bikes being left in public spaces.

At rush hour, e-bike congestion is also a rising concern. San Francisco banned them altogether last summer. It is now introducing a 24-month pilot program in which the city will only issue permits to a maximum of five companies that will be allowed to operate a maximum of 2,500 scooters in total.

Higher densities of e-bikes are also leading to more accidents. Last year, the Netherlands reacted by classifying e-bikes that can go faster than 25 kilometers per hour as mopeds. Faster e-bikes now require a license plate and riders have to follow the same rules as those of mopeds, such has wearing a helmet and having insurance.

Notwithstanding these challenges, consumer adoption of bike-sharing is strong, particularly in the e-bike and e-scooter segment. 40% of Dutch e-cyclists use them to replace car journeys. Businesses are also joining in. Deutsche Post, a logistics giant, owns a fleet of around 12,000 e-bikes and e-trikes (three-wheeled ones) in Germany.

Click here to explore the companies and opportunities featured in this article