Ford sells electric scooter unit Spin to Berlin’s Tier

Image: Spin

One of Europe's top shared mobility companies is buying Ford's electric scooter operation. Tier Mobility will take over Spin's operations, marking the first time a Berlin-based scooter company will have a foothold in North America. The CEO of Tier said that the sale price was all stock.

Spin was launched in Seattle in March of last year after working with the city to create a policy framework for regulating dockless bikes. After visiting Beijing, the founder of the dockless bike company, Euwyn Poon, was inspired to create the company. After Bird's success in Southern California, the company pivoted to electric scooters.

At the height of the scooter boom, Ford acquired Spin for $100 million, which was reportedly at the direction of former Ford CEO Jim Hackett, who was interested in branching out into new forms of mobility.

There was less and less room for expensive side projects as the automaker increased its investment in electric and self-drive vehicles. The company shut down its microtransit subsidiary. A public offering is being considered by the startup, which is backed by Ford and Volkswagen. Ford was considering merging Spin with a special acquisition company, as well as other options, when it decided to hire an outside advisor to consider its options.

Spin laid off nearly a quarter of its staff a month ago, after it pulled out of nearly every open permit city that doesn't restrict the number of permits. Several US cities, as well as European countries like Germany, Portugal, and Spain, were included.

Tier Mobility recently acquired Vento Mobility, the Italian subsidiary of Wind Mobility, and announced a $200 million fundraising round for a total valuation of $2 billion. Tier operates over one hundred thousand vehicles, including electric scooters, bikes, and mopeds, in over 180 cities across 19 countries in Europe and the Middle East. Bird, Lime, Voi, Dott, and Wind are some of the companies it competes with.

Photo by Hollie Adams/Getty Images

The acquisition will allow the company to move up the ranks, according to Ben Bear, who assumed the role of CEO of Spin in June 2021.

The vice president of new business at Ford, Franck Louis-Victor, celebrated the synergies between Spin and Tier.

Scooter sharing's early years were marked by steep losses even though it has proven popular with riders. The industry struggled to fix unit economics, in which the purchase price for each scooter exceeded the amount of revenue it brought in before eventually breaking down. Most companies relied on venture capital to stay afloat.

The original scooters deployed by companies like Bird, Lime, and Spin weren't built for shared use, so they were prone to breakdown within weeks of being rolled. Over the last several years, the scooter companies have taken pains to roll out better, more durable scooters in order to increase the average life span and improve their unit economics.

Spin has taken pains to improve its financial situation over the years, including a 50 percent improvement in unit economics and a profitable 12 months on an adjusted basis.

Tier and SoftBank give us a path to global leadership that wasn't available as a stand-alone entity.

Tier doesn't plan on making any more layoffs and will maintain the Spin brand in North America, according to CEO Lawrence Leuschner. Spin's scooter fleet will be converted to run on Tier's swappable battery technology. Spin's flagship scooter, the S-100T, is the company's first to feature a swappable battery.

Leuschner said that he thought the Ford people were super smart and that they really believed in micromobility. How good is your operation? What is the scooter doing here? How is the scooter doing there? I think we can make the business better by having more synergies.

Leuschner agrees with Spin's strategy of pulling out of open permit cities and focusing on markets that limit competition.