Bird announced the acquisition of Circ, the largest European and Middle-east electric scooter rental company. This merger is the latest sign of consolidation between companies involved in electric scootering as the quest for a profitable business model grows.
Bird will take over 200 Circ workers as part of the transaction, many of them based in Berlin. In addition, Bird reported an additional $75 million to its D-series funding round, which brings the total size of the round to $350 million – however the value of the deal was not revealed.
Circ is not the first purchase of Bird. In early 2019, the company based in Santa Monica bought its competitor on the West Coast, Scoot, for 25 million dollars. Bird returned to San Francisco, a lucrative market that was first removed from the city in 2018. Scoot was just one of two San Francisco scooters (Uber’s Jump, Spin & Lime models were recently approved in the city when the Skip Licensing license was removed.)
Circ, now operating in more than 40 towns in 14 European countries, has recently laid off dozens of workers in its headquarters and regional offices, in addition to the United Arab Emirates, in response to a shift in focus to’ efficiency and operational excellence.’ TechCrunch reports that about 50 workers have lost their jobs, or less than 10 percent. Bird has made cuts and lost 2 dozen workers when it bought Scoot, its other scooter.
Nonetheless, the Bird announcement of an additional $75 million shows, in spite of rumors of significant cash losses and rampant scooter theft, that venture capitalists did not finish pouring cash on e-scooter firms. In the first quarter of 2019 Bird lost close to $100 million, while its sales decreased dramatically to just over $15 million. The start-up for scooters was reduced in spring to approx. $100 million in cash.
For the electric scooter industry, it was a tough winter. Big companies like Lime, Uber and Lyft have taken staff away and withdrawn from their markets, as they have focused on profitability. Even with rougher and longer-lasting scooters, the cash flow has not changed yet.