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With $85 Million of New Cash, Voi Shows E-Scooters Aren’t Slowing Down

Nate Lanxon

(Bloomberg) -- Investor confidence in Europe’s e-scooter sharing companies is showing little sign of slowing down. Sweden’s Voi Technology AB has announced it’s closed $85 million in new funding.

It follows news in October that Berlin-based Tier Mobility had closed a $60 million financing round, led in part by one of the sovereign wealth vehicles behind SoftBank Group Corp.’s gargantuan Vision Fund.

“We’ve started to see profit in some cities, and we will use this new money to achieve profitability worldwide as a company by 2021 or 2022,” Voi Chief Executive Officer Fredrik Hjelm said in an interview ahead of the funding announcement.

Voi’s cash infusion comes before a particularly critical time for scooter companies: 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. U.S. micromobility giant Bird also announced in October it had raised $275 million in fresh capital ahead of the colder months.

Demand for e-scooters in cities worldwide has helped the industry’s biggest players achieve multibillion-dollar valuations in less than two years. The popularity of the North American front-runners, such as Bird, fueled by the projected value of being a future market leader, caused a surge of new competitors to spring up across Europe over the past 18 months.

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Market consolidation on the continent has been anticipated, but so far remains illusive. Bloomberg News reported in February that Tier and Voi had held early-stage talks about a possible merger in order to remain competitive, but both stayed independent and sought fresh funding instead. 

Voi’s financing was led by Vostok New Ventures, and included participation from a range of existing investors including Balderton Capital. The scooter startup’s previous raise, of $30 million, was announced in March. The company said in a statement it was now operating in 38 cities across 10 European countries. Per Brilioth, CEO of Vostok, singled out Germany in particular as a “huge market to go for.” 

Goldman Sachs was an adviser to Voi for the latest round of funding.

(Updates with Vostok comment in penultimate paragraph)

--With assistance from Candy Cheng.

To contact the author of this story: Nate Lanxon in London at nlanxon@bloomberg.net

To contact the editor responsible for this story: Matthew G Miller at mmiller144@bloomberg.net

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