Bike sharing battles: Startups pioneering a new breed of bike borrowing fight for market share
SOUTH SAN FRANCISCO — Adding a two-wheeled spin to Silicon Valley’s ongoing ride-sharing wars, competition is heating up between rival startups racing to cash in on the area’s newest transportation trend — stationless bike sharing.
Unlike Ford GoBike, which is installing dozens of bike parking kiosks throughout San Francisco and the South and East Bay, these new programs are untethered to parking stations — just leave the GPS-tracked bike anywhere after your ride, and the next cyclist uses a smartphone app to find it. Proponents say the convenience will transform biking the way Uber and Lyft have transformed driving. But the business model is controversial — some city leaders worry abandoned bikes will block sidewalks and create a nuisance, a concern that’s prompted San Francisco to enact strict new rules and a hefty fee schedule for bike sharing startups.
Two companies, Spin and LimeBike, simultaneously launched dueling fleets of bikes in South San Francisco on Tuesday. Already Mountain View, San Mateo, San Francisco and San Ramon have similar programs, and fleets are rolling out soon in Sacramento and Santa Cruz. Two stationless bike sharing startups also say they’re considering setting up programs in San Jose and Palo Alto.
“We’re at this inflection point,” said Shiloh Ballard, executive director of the Silicon Valley Bicycle Coalition, “where there’s a lot of disruption and there’s a lot of actors in the market coming in and saying ‘we want to be first, we want to the be the best product,’ and they’re all fighting. And that’s really exciting to see.”
Bicycles operated by bike sharing startup LimeBike are displayed during a press event to celebrate the company’s launch in South San Francisco on Tuesday, Aug. 8, 2017. (Marisa Kendall/Bay Area News Group) (Marisa Kendall/Bay Area News Group)
LimeBike on Tuesday launched a six-month pilot program in South San Francisco, planning to deploy 300 bikes this week. The San Mateo-based startup demonstrated several of its lime-green and yellow bikes for the media and curious passersby Tuesday morning, showing them how to unlock the back wheel by using their smartphone to scan a QR code attached to the bike’s seat. Rides cost $1 for 30 minutes.
Though they tend to charge low user fees, stationless bike sharing startups also keep their own costs down because they don’t have to pay to build docking stations. Social Bicycles, for example, which launched its first pilot programs in 2013, already is making a profit.
As for safety, despite the rear wheel locks, there’s not much to stop a thief from picking up the bikes and walking away with them. Locked LimeBike bicycles sound an alarm when you try to move them, and they use custom parts, giving thieves less of an incentive to steal them and strip them down.
So far it hasn’t been an issue for Spin. The company has counted a few “isolated incidents” of bikes being vandalized in Seattle — where the company has 500 bikes — and no thefts, founder Euwyn Poon said.
Bo Bixler, who lives on a boat in South San Francisco’s Oyster Point Marina, happened to be walking by during the LimeBike demo Tuesday, and said he loves the idea.
“I’m so tired of watching bicycle riders go faster than traffic,” the 61-year-old said. “I want to be one of the bicyclists.”
The stationless bike sharing trend started in China, where bike fleets operated by unicorn companies like Mobike and Ofo have become immensely popular. Ridership in the country more than doubled from February to March of this year, skyrocketing from 10 million users to more than 20 million, according to Kleiner Perkins Caufield & Byers partner Mary Meeker’s annual Internet Trends report. But the bikes also became an eyesore in some areas — in Shenzhen, users took to dumping discarded bicycles in massive piles, The Guardian reported.
Those images of unseemly heaps of bicycles looming over sidewalks and public squares prompted San Francisco officials to fight back in January when Chinese bike sharing startup Bluegogo attempted to roll out a fleet of stationless bikes without the city’s permission. Bluegogo ultimately pulled the bikes, and now the city requires stationless bike sharing startups to go through a permitting process and pay tens of thousands of dollars in fees before launching. So far Spin, LimeBike and Social Bicycles have submitted applications, but no one has yet been granted a permit, said Ben Jose, spokesman for the San Francisco Municipal Transportation Agency.
Bikes from the bikesharing company Spin, wait for customers outside the Chamber of Commerce building in Mountain View, California, on Monday, Aug. 7, 2017. (Karl Mondon/Bay Area News Group) (Karl Mondon/Bay Area News Group)
Also on Tuesday, San Francisco-based Spin deployed 125 bikes in South San Francisco, and plans to scale up to at least 500 after that. The startup has a pilot program in Mountain View, with a fleet of 10 bikes parked in bike racks outside the Chamber of Commerce on Castro Street.
Social Bicycles, which has offices in San Francisco and New York, rolled out a fleet of 50 bikes in San Mateo last year, which it expects to expand to 100 by the end of this year. The startup also operates 100 bikes in the Bishop Ranch office park in San Ramon, and in June rolled out a few dozen electric bikes in San Francisco to test a new program called “Jump” while it waits for official approval from the city to launch on a larger scale.
Massachusetts-based Zagster operates around two-dozen bike sharing programs around the Bay Area at corporate offices, including Salesforce, and college campuses including Santa Clara University. While the startup provides docking stations to its clients, the bikes also have smart locks that let riders lock them to other public bike racks when they’re done.
But a stand-off could be brewing between these startups and competitor Ford GoBike, as the startups try to expand into San Francisco, San Jose, Oakland and other areas where Ford GoBike has contracts with city officials. Ford GoBike, which is currently expanding from 700 bikes to 7,000, has exclusive rights to operate bike sharing programs in public right-of-ways in those cities, said Dani Simons, spokeswoman for Motivate, the company that runs the program.
Jose says the SFMTA, which doles out bike sharing permits in San Francisco, is still working with the City Attorney’s Office to determine what that exclusivity provision means for competing startups.
But that contract is a concern, said LimeBike founder and CEO Toby Sun, and his company is looking for ways to tweak its program so it won’t butt heads with Ford GoBike.
“There’s a certain level of monopoly there,” he said, “driving the innovation away from providing better service to the city.”
Stationless bike sharing in the Bay Area
Spin
Headquarters: San Francisco
Operates in: South San Francisco, Mountain View
Learn more: spin.pm
Social Bicycles
Headquarters: New York
Operates in: San Mateo, San Ramon, San Francisco
Learn more: socialbicycles.com
LimeBike
Headquarters: San Mateo
Operates in: South San Francisco
Learn more: limebike.com
Bike Share Takes a Beating
The Bay Area’s bike share system, which expanded in San Francisco and launched less than a month ago in the East Bay, seems to be off to a rocky start, with many reports on social and traditional media of slashed tires, stolen bikes, and even one bike dumped into Lake Merritt.
It’s important to note that, as much as it’s interesting to see a picture of a stripped-down Ford GoBike hung from a tree, it doesn’t say much about whether the system is working or not–the roll out numbers are still not crunched. No matter what, a certain number of bikes were bound to get stolen and/or damaged.
“The data I have seen is … showing usage at each pod,” wrote Dave Campbell, Advocacy Director of Bike East Bay, in an email to Streetsblog. “I intend to take a closer look at this data, but it is still early.” The San Francisco Bicycle Coalition expressed similar sentiment, that it was just too early to say anything about whether the system is taking off or not.
People familiar with bike-share systems in other cities say it’s not that unusual for vandals to go after the bikes initially–after all, it’s a new target and it can even get your handiwork on TV. “… vandalism and theft of private vehicles and bikes is also a common occurrence around here, sadly, so it should also be no surprise when this extends to the bike share bikes as well,” wrote Robert Prinz, Education Director for Bike East Bay.
The bike vandalism may also be part of a general blow-back effect other cities have seen after launching bike-share systems. Remember the Wall Street Journal‘s Dorothy Rabinowitz’s comment about New York neighborhoods getting “begrimed” by bike shares? If you’re not familiar with that, and some of the other ‘bikelash’ that took place when New York launched its system, check out this hilarious video of unintentional self-parody embedded in a post by Streetsblog NYC.
Meanwhile, bike-share operators are doing their best to clean up the messes and get the bikes back into circulation. “Our team operates 24-hours a day and we are rapidly responding to any reports of vandalism, and making any necessary repairs,” said Dani Simons, a spokesperson for Motivate.
“It’s all speculation at this point, but I see everyday in Oakland, bus shelters smashed, BART cars trashed, litter all over the freeways and car windows broken into. I guess someone hates transportation in general,” wrote Campbell.
Still, the pictures of the abused bikes are oddly amusing. One has to wonder if Bluegogo, the renegade bike share company that was essentially chased out of San Francisco by regulations, is laughing at it all. In addition to the bike hung from a tree and the submarine bike in Lake Merritt, Hoodline has a shot and video of a row of Ford GoBikes with slashed tires. And, in case you think this is particular to the Bay Area’s official bike share system, Streetsblog found this Jump electric bike with both tires popped, on Valencia.
This Jump electric bike also suffered some wrath. Photo: Streetsblog/Rudick
The reasons for the bike-share vandalism are unclear. Is it an anti-gentrification protest statement? Or generalized bike-lash as they saw in New York City? Or all-too-common vandalism of objects in the public realm? Or multiple reasons?
Is all this abuse beating up bike-share, making it difficult to use? Do you ride Ford GoBikes? Do you find the recent expansions useful? Tell us what you think.
