Scooter startup Bird is seeking a $2B valuation
As an investor who has looked at this space a little bit + talked to other investors who have backed some of these companies, it seems like:<p>- the economics of scooters are great (very quick payback periods for the scooters). At a few bucks per ride and maybe a dozen rides per day, it doesn&#x27;t take that long to pay off a $300 or $500 scooter.<p>- most people that try scooters seem to really enjoy riding them.<p>- an individual scooter doesn&#x27;t last super long and needs to be serviced a lot and then replaced.<p>As an investor, the main thing I&#x27;m stuck on is what the moats could be in this business. Brand is a potential moat, but the two biggest companies in this space already have good brands so that&#x27;s not helpful for me as a seed investor. And I&#x27;m not sure if brand would be enough for people to walk an extra block or two if there are closer scooters nearby.<p>People talk about network effects, but I am skeptical. First those network effects are local. Second, it doesn&#x27;t take <i>that</i> much money to blanket a city with scooters and break the network effect. My napkin math for SF is that it would cost &lt;$1.5m to put a scooter on every other block (<a href="https:&#x2F;&#x2F;twitter.com&#x2F;lpolovets&#x2F;status&#x2F;992503477149450240" rel="nofollow">https:&#x2F;&#x2F;twitter.com&#x2F;lpolovets&#x2F;status&#x2F;992503477149450240</a>). If that&#x27;s accurate, then it&#x27;s not going to be a big barrier against any well-funded company.<p>Maybe one moat could be scooter durability. If your scooters are 2x more rugged, then your margins and economics are a lot better, and you can use the additional profits to outspend your competitors on customer acquisition. We&#x27;ll probably find out what moats do (or don&#x27;t) exist here over the next few years.