After Lyft's partnership with Baltimore, Uber buys a Bikeshare Company - Baltimore Post-ExaminerBaltimore Post-Examiner

After Lyft’s partnership with Baltimore, Uber buys a Bikeshare Company

Lyft announced in February that it was partnering with the city of Baltimore and Baltimore Bike Share to transform bike-share stations into pickup and drop-off locations for Lyft.

As per the agreement, Lyft gets to place its logo on five bike-share stations and will make a $270,000 investment to sponsor the hubs for three years. The partnership includes integration in both the Baltimore bike-share app and the Lyft app.

The goal is to transform the stations into “co-located transportation hubs” where people can choose between ride-sharing pickups and bike-sharing. These hubs would act as centralized locations for Lyft drivers to pick up passengers.

Bike-sharing is a hot trend, especially among tech startups. In Europe and China, bike-sharing is all the rage.

Now, Uber has acquired a bikeshare company of its own: Jump. Uber’s relationship with Jump, a dockless bike-share service, started out as a partnership. As part of the deal, users were able to reserve and pay for a bike directly through the Uber app.

The company took the partnership a step further on Tuesday, announcing that it had acquired Jump, formerly known as Social Bicycles. The acquisition will reportedly cost the ride-sharing company $200 million.

The company had raised about $11 million in venture funding from investors, which included SOSV, Menlo Ventures, and SineWave Ventures.

Jump was the first company to receive a permit to launch in San Francisco. It has since launched 250 dockless e-bikes on the city’s streets.

“Rolling out potentially hundreds of bikeshare programs across the U.S. will require hundreds of millions of dollars in capital,” said Brad Higgins, SOSV partner who was an early investor in Jump Bikes. “Instead of Jump’s management team spending half their time raising this additional capital, Uber’s financial strength will allow them to focus all their time and efforts on the rollout and support of these bike-share programs.”

Higgins also cites Uber’s expertise in setting up local operations across the U.S., which will be helpful if the company tries to rapidly expand its operations.

It is still unclear how the acquisition will affect Uber drivers in the long-run.

Right now, the bike-sharing market is in the same state the ride-sharing market was in its early days. Much of the industry operates in a legal gray area. About half of the states in the U.S. classify e-bikes as a motor vehicle, which requires registration, licensing and insurance. That could make them illegal to ride in some areas.

An Uber investor familiar with the matter told Fortune that the acquisition will help Jump in some areas and hurt it in others.

“In jurisdictions where Uber has good political relationships, it adds value but they also pick up all of Uber’s baggage,” said an Uber investor familiar with the matter.

In China, there were more bike-share rides between 2013 and 2017  than rideshare rides in the U.S. during the same period.

In the U.S., there are a few market players, including Bird, Motivate Co, Spin, and LimeBike. No real dominant player has emerged in the market as of yet. LimeBike and Bird have raised over $100 million in venture funding.


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