The Fuse

Scoot CEO: Electric Mobility Services Will Be “Mass Transit of the 21st Century”

by Jena Merl | July 27, 2018

In cities across the country, new mobility solutions are transforming how Americans go about their daily lives. Carsharing, bike sharing, and a whole host of new options are changing the urban landscape and now complement fixed mass transit systems, like rail and bus lines. Electric-powered scooters are one emergent transportation technology. By 2024, Market Insights, Inc. expects the global electric motorcycles and scooters market to be valued at $22 billion—a significant increase from its small size today. And observers say demand for scooters could rise even more sharply if battery technology improves and costs become even more competitive with other last-mile solutions.

Demand opportunities

Electric scooters tap into the pent-up demand for urban mobility without the physical exertion of traditional bicycles or the expense and inconvenience of driving in a congested city. They fulfill the specific need among many urban commuters to travel to and from their destinations without working up a sweat—affordably and conveniently.

Scoot Networks, Inc. is one company that is innovating this new space. Marketed as a community with an approximately 500-scooter fleet, the service is free to join on mobile devices and like Uber or Lyft, gives customers an estimated fare for trips. Since the company launched in 2012, over 5 million electric scooter miles have been tracked in San Francisco and the company recently rolled out a test fleet in Barcelona.

Scoot is working to reduce urban congestion that leaves city streets lined with underutilized vehicles.

CEO Michael Keating saw that public transportation options in hubs like San Francisco, New York or Washington, D.C. left significant gaps in urban navigation. Scoot is working to reduce urban congestion that leaves city streets lined with underutilized vehicles. The current system creates pollution, problems with parking and land use, and contributes to noise in cities. “Commuters had been cornered into choosing between affordable but slow public transit or quick but expensive driving options, like taxis, ride-sharing, or car ownership,” Keating said. “Go city by city, they all have the same dilemma.”

Keating bets electric mobility services will outpace internal combustion engine vehicles in the long-run and “will help shape 21st century mass transit.”

This forecast is not just wishful thinking. Shared electric motorbikes can optimize efficiency and restructure commuters’ current economic and energy footprint. “The electric motorbike is the most efficient motor vehicle that can go faster than 20 miles per hour. A Scoot moped gets 500 miles per gallon [of gasoline] equivalent,” he said.

New partnerships

A Scoot moped gets 500 miles per gallon of gasoline equivalent.

Budding partnerships with local governments have played an important role for the successful integration of advanced transportation fuels and new technologies. While complex and interconnected legacy systems are extensively regulated, how the current network of shared mobility solutions evolves remains an open question. Companies like Scoot, Bird and Lime have identified where they can collaborate at the municipal level and provide a need where city governments simply lack the bandwidth. This influx of sharing services is filling a void for more low-cost, instant options that are attainable for all commuters, particularly from the working class.

While some major public transit systems have recorded financial losses in recent years, the growing popularity of these services represent a new frontier for investors. Earlier this month, Uber, in partnership with Alphabet Inc., announced a $335 million investment in smart bike and electric scooter company, Lime. The biggest commitment will go into scooters, with Lime’s business valued at over $1 billion. Following closely, Lyft also just announced its purchase of bike-sharing giant Motivate. New partnerships among rivals suggests that there are serious opportunities to capitalize on the growing demand in this space.

While Keating’s priority was to tackle the issue of congestion and climate, he sees reducing petroleum consumption as an added benefit to Scoot’s mission. “Energy security is both a national and local issue,” he said.

Millions of dollars are sent out of cities every day to oil producers overseas. Electric vehicles keep money in the local economy.

Municipal governments could save on gasoline expenditures, which in the long-run could be allocated towards needed infrastructure investments. “Millions of dollars are sent out of cities every day to oil producers overseas. Electric vehicles keep money in the local economy.”