Lime Looks to Build a Perpetual Scooter Fundraising Machine
(Bloomberg) -- In dozens of cities around the world, you seemingly can’t walk a couple blocks without stumbling over an electric scooter. Startups are looking to cover sidewalks with two-wheeled vehicles for rent using an app. This prospect, it turns out, is very expensive.
Lime, one of the largest scooter-rental companies, expects to overcome this hurdle by dialing up the speed on a strategy it already employs: raising capital from investors. Lots of it. That responsibility will now largely fall to Ted Tobiason, a private capital dealmaker from Morgan Stanley. Lime plans to announce Thursday that Tobiason will leave his post as a managing director at the bank to become the startup’s chief financial officer.
At Morgan Stanley, Tobiason helped Uber Technologies Inc. pursue a similar tactic. He assisted in fundraising efforts for Uber, which has burned through more than $10 billion in its lifetime and is on track for what’s expected to be a blockbuster initial public offering in the coming months. Tobiason worked closely with David Richter, who was head of business at the ride-hailing company during a period of tumult and transition. Richter joined Lime in October.
In a little over two years, investors have put more than $770 million into Lime, the company said. Almost half of that came this month in a deal with Alphabet Inc.’s GV, Andreessen Howoritz, Bain Capital Ventures and other investors. “The company just raised a considerable amount of money,” Tobiason said. “We have certainly some time to work on deploying that capital.”
Yet, Lime plans to follow the Uber playbook of persistent private fundraising, in a bid to establish itself as the dominant player for electric-scooter rentals, Tobiason said. He said the industry will soon consolidate and reward companies like Lime that run with efficiency and scale. “A market that deploys capital to everybody, that smears capital like peanut butter is not an efficient market,” Tobiason said. “I don’t have the brilliance of mind to tell you who the next investors will be, but I can tell you the field is open.”
Lime has been in a fierce rivalry with Bird Rides Inc. since 2017, when both companies were established in California. Collectively, the two startups have raised more than $1.2 billion in that time. Last summer, Uber bought stock in Lime.
Bird was started by a former Uber executive, Travis VanderZanden, but Lime has filled its ranks with talent from the ride-hailing company. Lime recently named the chief of staff to Uber Chief Executive Officer Dara Khosrowshahi as its global head of operations strategy and former corporate attorney Lindsey Haswell to oversee legal matters, human resources and communications.
Haswell said she’ll hand over her HR duties to Nancy Lee, the new chief human resources officer who previously played a key role in setting diversity strategy at Google. Lee started at Lime this week.
Lime will need to master Uber’s strategy better than Uber itself. The much larger transportation company recently started offering its own electric scooters and bicycles for rent in cities, as has the second-largest U.S. ride-hailing operator Lyft Inc. and other companies around the world. Uber said it’s building tens of thousands of personal electric vehicles for deployment in the U.S. this year.
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