Just after 7 a.m. on a recent weekday morning, Alexander Berg pulled his van — bright green, with the word “LimeBike” emblazoned on the side — over on a corner on the edge of San Francisco’s Chinatown. Berg, a thin, cheerful 31-year old in a hoodie, pulled on a pair of black gloves and threw open the back of the van, which was filled with electric scooters. “We’ll do three here,” he said.
Berg’s employer, a startup named Lime based just south of the city in San Mateo, is one of a handful of companies that have spent the last few months sprinkling hundreds of bikes and electric scooters around American cities. They allow people to unlock the vehicles with smartphone apps and ride them for as little as $1, leaving them sitting on the sidewalk when they’ve reached their destination.
The companies — and the investors who have poured hundreds of millions of dollars into them over the last year and a half — see this as the next step in the massive recalibration of transportation that Uber and Lyft kicked off about a decade ago.
In an open letter to his competitors, Travis VanderZanden, chief executive officer of Bird, another scooter-sharing company, described it as the “biggest revolution in the transportation since the dawn of the Jet Age.” Scooter sharing was an immediate hit. Lime said that each vehicle in its major markets gets used nine times on an average day. In San Francisco, that adds up to about 2,200 daily rides.
But this popularity has also been polarizing. The scooters are broadly seen as an annoying fad among tourists and clueless tech workers, who zip around the city’s sidewalks, breaking the law — scooters are supposed to be ridden in the street — and imperiling everyone around them. Scooters have been thrown in waterways and trees, broken in half, and smeared with poop.
Toby Sun, Lime’s co-founder and CEO, said some chaos is be expected in the early days of a cultural shift. “In order to change people’s behavior, we have to change their mindsets,” he said. But there’s been less than careful consideration of the consequences, in part because Lime itself was caught unaware by the sudden interest in scooter sharing. When it launched early last year, Lime was a bike-sharing company. Then Bird kicked off its service in Santa Monica, turning into a sudden sensation and leaving Lime scrambling to design and build its own scooters. This month, the company officially recognized its shifting priorities by dropping the “-Bike” from its name. The rebranding happened so quickly that Lime didn’t have a chance to reflect the change on its equipment.
It’s not unusual for startups to set their internal treadmills to speeds they struggle to maintain, especially when venture capitalists are pushing them to dominate. Lime, which has already raised $132 million, is working on closing another fundraising round, which it expects to close within weeks. It’s in 60 markets, and plans to be in 100 markets by the end of the year. To keep this pace, the company has sacrificed peace with local governments, something it has consistently said it would prioritize.
Last month, San Francisco’s city attorney sent cease-and-desist orders to the scooter-sharing companies, while local lawmakers wrote new rules. The city is accepting applications from companies looking to operate scooter-sharing services, but the number of scooters they can deploy will be limited. Honolulu; Charlotte, North Carolina; Austin, Texas; and Nashville, Tennessee have also taken action to slow the spread of scooters.
Lime recently hired Scott Kubly, formerly the director of Seattle’s Department of Transportation, to smooth over its relationship with local governments. Convincing skeptical residents falls largely to people like Berg. As he makes the morning rounds, he sees his job as both scooter distributor and ambassador.
The scooters were barely out of the truck at his first stop when a woman approached him with a hostile look. “Excuse me,” she said. “Are you just planning to leave those here?” “Yes,” said Berg.
The woman quizzed him with an exasperated tone. She doubted the city had really approved of what he was doing, argued that leaving a bunch of scooters on the sidewalk was dangerous, and told him that the residents of this particular neighborhood didn’t want them around.
Throughout it all, Berg remained as chipper and deferential as a Walmart greeter, smiling broadly as he parried each of her points. The woman, unmollified, eventually seemed to accept defeat. Berg bunched the scooters close to a bike rack, which he felt addressed the woman’s concerns. He closed the back of the van, took off his gloves, and jumped back behind the wheel. “Happens all the time,” he said. “We try to address it first hand, so they know we’re listening.”
Later that morning, about two dozen new employees squeezed into a conference room for orientation at Lime’s headquarters, located in a scruffy office park across the street from a store selling guns and swords to collectors. The group pushed the room far past capacity, an appropriate introduction to a company stretching its limits in pretty much every way. There are more people in the office than desks, and they have to step around bikes and scooters to move back and forth. Sun addressed the group — he was sporting lime-green running shoes, track pants, and a pair of lime-green sunglasses pushed back on his head— as did Brad Bao, his co-founder and the company’s executive chairman. The two men run the company together.
Bao is a thin, energetic man who uses a bicycle for the nine-mile commute to work; sometimes he uses one of Lime’s bikes, other times he takes his personal bike. Bao acknowledged to his new employees that he couldn’t tell them exactly what to expect. “We’re pushing on a lot of fronts, and it’s not easy.” Within the office, the breakneck speed is a point of pride: employees say they’re working on “Lime Time.”
Bao and Sun met through an alumni group for the University of California at Berkeley’s business school, then worked together at Fosun Kinzon Capital, an investment firm active in both China and the U.S. Bao was Sun’s boss, and put him in charge of finding investment opportunities in transportation. Both men were struck by the Chinese phenomenon of bike-sharing, where companies just dumped bikes around town rather than setting up docking stations in strategic locations, like in the U.S. For riders, this provided more flexibility; for cities, it erased the need to create any new infrastructure. When they couldn’t find a company they thought would be a good investment, the two decided to start their own.
Bike-sharing is a deceptively complicated business. Lime had to acquire a fleet of vehicles strong enough to withstand a beating, build software to deploy them, and establish individual operations in each city. Adding scooters was just another layer of complexity. Even transportation experts who support the sharing platforms expected them to spend years in obscurity. “Nobody took it seriously — at least I didn’t,” said Sharon Feigon, the executive director of the Shared Use Mobility Center, an advocacy group pushing for alternative transportation. “Then all of a sudden it took off.”
Besides pedal bikes, electric-assist bikes and scooters, Lime is also developing “transit pods,” one- or two-person vehicles smaller than cars but more powerful than golf-carts, that drive in city streets. Bao and Sun are vague about when the pods might hit the streets.
Eventually, Lime envisions a kind of transportation subscription service, where people would choose the type of vehicle based on their needs. While skeptics see an odd fad, Lime thinks its business will become an alternative model for transportation, at least in urban areas.
Uber and Lyft have been hinting that they see things in a similar way. In April, Uber paid over $100 million to buy Jump, another bike-sharing company, and Lyft has approached San Francisco about launching its own scooter-sharing service, according to technology news website the Information.
While some city officials feel that they’ve suddenly been deluged with scooters, Bao argued that they need more. Capping the number, he said, will doom scooters to being novelties, because there won’t be enough of them for people to always find one. A better solution, he said, would be to require companies to show that each vehicle is getting a minimum amount of use each day. He suggested a threshold of two rides per day for scooters, and one ride every two days for bikes. In Lime’s major markets, the company said that people who open the app fail to find a scooter about half the time. “It would be bizarre for a transit system to know that 50 percent of riders can’t get on a train, and then you say, let’s reduce service,” said Bao.
For now, a main limiting factor on scooting is the capacity of the batteries. Scooters start off fresh at the start of each day, but are mostly exhausted far before the sun sets. On a recent Sunday in San Francisco’s financial district, inert vehicles were scattered throughout the streets, frustrating people trying to use them.
Two pre-adolescent boys sprinted up to a group of scooters tucked against a wall along the Embarcadero, then realized they were out of juice. One boy checked his phone and yelled, “There’s one over there!” Off they ran, as a group of women in high-heels came up to the scooters and posed for selfies.
Hoping to get a free ride, a child broke away from his dad and dragged one of the scooters into the middle of the sidewalk, realized it wouldn’t start without being unlocked, and abandoned it. Within a minute, a teenager rode by on a bike and kicked the scooter, nearly hitting a passing stroller. “Oh no! I kicked a LimeBike,” he shouted.
An annoyed employee from a nearby water taxi grabbed the scooter and dragged it against the wall. “I hate them,” she said of the scooters. “I wish I could throw them in the Bay, but I know I’m on camera.”
In the ensuing hour, about 20 people tried to unlock the scooters. Just after 6 p.m., a dingy white Dodge Astro pulled up, a small red light spinning on its roof. Out jumped Livia Looper, a tall woman with tattooed arms and hands, sporting a long black skirt. She threw open the back of the van, which already had five scooters inside, and lugged over the three scooters within sight. Then she proceeded up the road. About a half a mile up, Looper saw a scooter lying on its side. A man was examining it. Looper pressed a button on her phone, causing the scooter to make a loud noise, and he quickly moved along. Looper tossed that one in her truck, too.
In Lime’s parlance, Looper is a juicer. The company pays her for each scooter she takes off the street, charges, and drops off before dawn the next day at designated spots. The standard rate is $12, although Lime tweaks the price based on specific conditions at various times. As of early May, Lime had about 250 scooters in San Francisco, and juicers were responsible for the nightly recharging of less than half of those.
Other scooter-sharing companies have adopted a similar model, using contract labor to help maintain their fleets, while pitching the idea to potential workers as something of a lark. The idea is a variation of the labor model popularized by Uber and Lyft, as well as delivery companies like Postmates, who have all drawn consistent criticism by paying low wages and avoiding benefits by classifying drivers as independent contractors.
Bao said Lime would avoid such controversy. The company, he said, isn’t so reliant on the juicers that it would risk conflict by trying to cut into their wages. Besides, he said, no one is going to support themselves by driving around at night charging electric scooters. “In our case, there’s no pressure,” he said. “If it’s too low nobody’s doing it, that’s just a fact.”
Looper’s story gives a more realistic picture of how this corner of the labor market actually works. In March, she was living in her car. She had a college degree, but felt stuck in the margins of society. “I’m transgender, I’m a thief if you check my criminal background,” she said. “Once you’re down below the poverty line, and you don’t have a certain job history, and you don’t have access to showers, it gets really difficult to compete.”
Looper was one of the first juicers to hit the streets, and immediately started pulling in over $200 on a good night, minus her expenses. Gas costs about $20 a day, and she pays $70 a month in insurance. At first Looper paid to rent a U-Haul, then bought the Astro for $500. She pays friends for access to a warehouse they’re squatting in, where she charges about two dozen scooters a night and sleeps during the day. She hopes to move into her own studio soon. She was also able to pay for a long-delayed trip to the dentist.
Looper is grateful for Lime, which she said provided her with a bridge back to the mainstream. But it’s uncertain how sustainable her situation will be. Lime recently put caps on the number of scooters any single person could pick up in a night, effectively limiting Looper’s income. As more juicers join the market, said Looper, people are increasingly anxious there won’t be enough scooters to justify their time. Looper said that fear hasn’t been borne out, not yet at least. She sees the gig as lucrative but temporary.
“I make what I make because I work seven days a week, four to sixteen hours a day,” she said. “The benefit of being an independent contractor while able-bodied.” Once she saves enough money, Looper plans to sell the Astro for scrap — she think she can get $300 for it — and move on. “That’s why I’m working so hard now,” she said. “I don’t know how long it will last.”
©2018 Bloomberg L.P. This article was written by Joshua Brustein from Bloomberg and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to email@example.com.