Uber and Lyft have won a key battleground in the electric scooter wars

People
ride Bird scooters in Santa Monica, California, U.S. July 23,
2018. Picture taken July 23, 2018.
Lucy Nicholson/Reuters

• In an effort to curb the onslaught of electric
  scooters, Santa Monica, California, is moving to limit the
  number of companies that can operate dockless vehicles
  there.
• An internal memo reveals that a City Council committee
  endorsed Lyft and Uber for permits — handing a crushing defeat
  for dedicated scooter operators Bird and Lime.
• Santa Monica was the ground zero for electric scooters,
  because $2 billion startup Bird rolled out the first
  scooter-share program nationwide in the coastal city last
  fall.

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In the south Californian city of Santa Monica, the electric
scooters that cover the city’s streets and sidewalks disappeared
on Tuesday in protest of the city’s move to block two
venture-backed startups from operating.

The shutdown, called “A Day Without a Scooter,” as well as a
protest outside City Hall, was part of a joint campaign from
scooter startups Bird and Lime condemning a decision from the
Santa Monica City Council to limit the number of companies that
can operate dockless vehicles there.

Bird and
Lime are fearful they won’t be picked for permits.

In an effort to curb the onslaught of scooters, the city of Santa
Monica recently announced a “shared mobility” pilot program that
will award four contracts — two scooter and two e-bike operators
— with the goal of deploying vehicles in the coastal city this
fall.

A special committee started accepting applications last month,
then scored the companies across seven categories, including
experience, operations, compliance, and parking and safety. While
the contracts haven’t been awarded yet, an internal
memo from the city’s planning director, released to the
public, reveal which companies sit at the top of the heap.

Lyft placed first, with the Uber-owned Jump coming in second, in
the committee’s scoring of scooter and e-bike operators. They
effectively won the city’s endorsement for contracts to operate,
leaving their upstart competition in the dust. 

Bird invented the scooter-sharing market

The results
were perceived as a major blow to Bird, which began its very
existence in Santa Monica. 

Tech investors credit Bird with inventing the scooter-sharing
market. When the company launched the first scooters in its
hometown last fall, its competitors — namely LimeBike, Spin, and
Ofo — were still focused on bike-sharing. They added scooters to
their inventory in 2018, and LimeBike later rebranded as Lime.

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Lyft doesn’t have scooters or e-bikes in any city, though it

bought Motivate, the country’s largest bike-sharing operator,
in July. Similarly, Uber got into bike-sharing with its $100
million acquisition of Jump, which has e-bikes in major US
cities, including Austin, Chicago, New York City, and San
Francisco.

It’s been less than a year since Bird launched, and already the
startup was rumored to be seeking a $2 billion valuation in the
last funding round. Bird raised $400 in four months from Sequoia
Capital, Greycroft, Tusk Ventures, and Upfront Ventures.

Roelof Botha, a partner at Sequoia who sits on Bird’s board, told
Business Insider in June that being first to market places Bird
one step ahead of the competition, including giants Uber and
Lyft. 

“If you’re the one who invented it, you’ve probably thought
about the problem many layers deep,” Botha said of Bird.

“That’s the thing with people who copycat — they copy what
the see today,” he went on. “But they don’t know what you’ve been
thinking. They don’t know the next move that you intend. How
you’ve already mapped out the next several months or the next
several quarters of product innovations and nuances.”

Birds flock to City Hall in protest

Bird sent an email to its riders in Santa Monica on Tuesday
night, saying that a “small city-appointed selection
committee” is moving to ban Bird in September,
Curbed Los Angeles reported.

It encouraged supporters to gather outside City Hall to
voice their support for Bird. The flock responded to the
call.

On Tuesday, a
crowd of about 200 scooter startup employees, “chargers”
(gig-economy workers who scrounge for scooters and charge their
batteries to make a quick buck), and supporters swarmed City Hall
in black and green Bird and Lime shirts.

A city spokesperson told the
Los Angeles Times that nothing has been done to “stop or
suspend operations of shared mobility vendors.” Santa Monica will
reach a decision in the coming weeks.

Bird did not immediately respond to a request for comment.

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