Scooter Giant Bird Raises $275 Million as Winter Looms

(Bloomberg) -- Scooter companies want to turn a profit—and they’re going to be spending a lot of money to do it. 

On Thursday, electric scooter startup Bird Rides Inc. said it had raised $275 million in fresh funding. The cash infusion comes ahead of a particularly critical time for the company: winter. As the weather turns colder, and streets become slick with snow and rain, scooters are a far less appealing mode of transit, battering startups’ margins. 

Weather notwithstanding, Bird Chief Executive Officer Travis VanderZanden said he is focused on getting the company closer to breaking even on its scooters. “Positive unit economics is the new goal line,” VanderZanden said in a statement. 

That’s difficult in the famously resource-intensive scooter business, but it’s also increasingly important, as public market investors shun money-losing companies, threatening Silicon Valley’s long-held thesis that profits can wait while businesses grow. 

Bird’s latest funding round values the startup at $2.5 billion. The new valuation is higher than the roughly $2 billion price tag investors gave it earlier this year, but a far cry from the $3 billion-or-higher valuation that it was said to be chasing in 2018. Still, the investment shows that investors haven’t given up on scooters, despite heightened regulation and intense competition from players like Lime and Skip Transport Inc. Ride-hailing titans Lyft Inc. and Uber Technologies Inc. have also been expanding into the sector with their own shared scooters and e-bikes.  

Founded in 2017, Bird became one of the youngest startups ever to reach unicorn status, quickly raising hundreds of millions of dollars. In June, the Santa Monica, California-based company said it was acquiring one of its smaller rivals, Scoot, for an undisclosed amount. The acquisition helped Bird re-enter the San Francisco market, where regulators had virtually shut it out.

Canadian pension fund Caisse de Depot et Placement du Quebec and Sequoia Capital led Bird’s new funding round, which was earlier reported by TechCrunch. Roelof Botha, a Sequoia partner and member of Bird’s board, echoed VanderZanden’s focus on making scooters pay: “The team at Bird exemplifies grit and has embraced a laser focus on the key drivers of unit economics in a complex business,” Botha said in a statement.

To contact the editor responsible for this story: Anne VanderMey at avandermey@bloomberg.net, Mark Milian

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