Weekly startups: the scooter cash desert

Weekly startups: the scooter cash desert

Hello and welcome back to Startups Weekly, a newsletter published every Saturday that dives into the week’s notable venture capital deals, funds, and trends. Before we delve into this week’s topic, let’s catch up. Last week, I took note of my key takeaways from the Recode + Vox Code Conference. Before that, I explored the bull versus bear arguments regarding the Peloton’s upcoming IPO.

Remember, you can send me suggestions, suggestions and comments at [email protected] or on Twitter @KateClarkTweets. If you don’t subscribe to Startups Weekly yet, you can do so here. Now for some quick thoughts on what I’ll call the scooter financing wilderness. For months, electric scooter companies had big rounds with even higher valuations. So much so that the extravagance of venture capital funds in e-scooters defined Silicon Valley in 2018.

But it’s 2019, and times have changed. In an effort to avoid falling down the rabbit hole of a scooter, I’m just saying this: raising capital is no longer an easy task for scooter companies. E-scooter companies have matured some and investors are more aware of the high costs of building and scaling these hardware heavy businesses.

Scoot, who recently sold to Bird, Sources tell TechCrunch that it was unable to raise additional capital, so an exit to Bird is the only viable option. Bird paid less than $ 25 million for Scoot, a significant decrease from Scoot’s most recent private valuation of $ 71 million.

A recent report from The Information suggests that both Lime and Bird, the leaders of the United States, may run out of cash if they don’t ramp up again soon. “Lime He has raised a total of more than $ 1 billion in the last two years, and in the last eight months he has shuffled his executive team and focused more on how to squeeze more money out of every scooter trip. The company quickly reviewed its cash last year, including a $ 23 million loss in one month, before raising $ 310 million mostly from existing investors in February, “wrote Cory Weinberg of The Information.

Bird, meanwhile, is running at less than $ 100 million and is expected to rise again this summer.

Bird may be in a better position to raise fresh funds. The company participates in the VC negotiations shortly after the Scoot acquisition, which gives it access to San Francisco, a coveted market in the scooter universe. The lime, meanwhile, is said to be struggling. The company enters into settlement negotiations between a series of personnel changes. Multiple political leaders in the business, including program director Scott Kubly, recently resigned, as did Lime co-founder and CEO Toby Sun.

I’d bet both Bird and Lime will announce mega rounds in the coming months, but in much smaller valuation increments than we’ve seen in the past, maybe even a flat valuation. It is worth noting, however, that e-scooters are still exploding around the world. The Bounce of India, for example, closed with $ 72 million this week to scale its scooter rental business.

To other news …

Workplace's Messaging App Listed on the New York Stock Exchange

Slack’s Big Listing: It happened. Slack went public this week after completing a direct listing. The workplace communication software debuted 48% on the New York Stock Exchange Thursday at $ 38.50 a share, after reports emerged Wednesday night that the company had agreed to a benchmark price. of 26 dollars per share. Slack, founded in 2009 as Tiny Speck, closed 48.5% Thursday at $ 38.62 a share. The stock had risen as high as $ 42 in intraday trading. Slack’s market capitalization now sits well above $ 20 billion, or nearly three times its most recent private valuation of $ 7 billion.

Facebook’s New Cryptocurrency: Explained

I know, I know, Facebook It’s not a start, but Facebook’s attempts to create a new global financial system are worth knowing. Josh Constine from TechCrunch wrote 4,000 words to help you understand the ins and outs of the new cryptocurrency, called Libra, which will allow you to buy things or send money to people at almost zero fees.

The future of diversity and inclusion in technology.

Here’s my must-read for the week. Megan Rose Dickey by TechCrunch wrote what is perhaps the most comprehensive story on the state of D&I in technology today. He interviewed many leaders in the space, including Arlan Hamilton, Ellen Pao, Freada Kapor Klein, and more, to provide a realistic summary of the progress we’ve made in making the tech industry more inclusive, and what remains to be done. .

Is Seed Investing Still a Local Business?

According to CB Insights, the number of early stage financing deals in the United States declined for the fourth year in a row in 2018, continuing a trend that has seen the number of deals steadily declining, while the average size of deals agreements increases. It’s safe to say this is the new normal. However, there is still a large surplus of capital available and there are more funds than ever. Here are three things entrepreneurs should remember when investors come calling from abroad.

Initial capital

Meero raises $ 230M for his photo-on-demand business Postman raises $ 50M to grow his development platform APINavigator, the new project from the creators of Mailbox, starts with $ 12M Nigerian motorcycle transit company MAX.ng ​​raises $ 7 Million Humanizing Autonomy Raises $ 5 Million To Help Drive Cars Watch Pedestrians Armoire Gets $ 4 Million To Become Daily Track Rental Genetic Likely To Land VC Endorsement To Launch D2C Genetic Testing Business

An illustration shows a man exhaling smoke from an e-cigarette in Washington, DC, on October 2, 2018.

The Juul Enigma

San Francisco is getting closer to banning the sale of e-cigarettes in the city to prevent minors from accessing them. The city’s Board of Supervisors voted unanimously this week to approve two proposals: legislation that would prohibit the sale or delivery of e-cigarettes in San Francisco and a separate proposal that would prohibit the sale, manufacture, and distribution of tobacco products, including cigarettes. electronic , owned or managed by the city. It appears to be designed to target Juul, as the company’s headquarters are in city-owned buildings on San Francisco’s Pier 70. Juul has already started lobbying to stop the ban.

Extra Crunch

If you’re not sure about subscribing to TechCrunch’s awesome subscription service, now is the time. Until next Friday, it’s only $ 2 a month for two months. It seems like a no-brainer. Sign up here. Here are some of my favorite EC pieces of the week:

The VCs behind Libra, Facebook’s new cryptocurrency

If you enjoy this newsletter, be sure to check out TechCrunch’s entrepreneurial podcast, Equity. In this week’s episode, available here, TechCrunch editor Danny Crichton and I discussed Facebook’s cryptocurrency, the scooter funding wilderness, and more. You can subscribe to Equity here or anywhere else you listen to podcasts.