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Presented by Veo
The shared micromobility industry is entering a new era. Post-pandemic ridership is on the rise as cities begin to transition their micromobility programs from pilot phases to long-term programs. This new era is also putting the industry to the test as companies struggle to establish profitable business models for long-term viability.
“Micromobility will play a vital role in helping cities transition to a more car-free, carbon-free and less polluted future,” says Edwin Tan, president and co-founder at Veo, the industry’s first profitable micromobility company. “But companies and city partners must work together to get it right.”
According to Tan, that requires collaboration on policy, offering mixed fleets of vehicles and taking financials more seriously.
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Integrating micromobility with safe, reliable transportation networks
Micromobility is coming into the spotlight as movements like Vision Zero gain momentum in the U.S. The strategy, first implemented in Sweden in the 1990’s, is aimed at eliminating all traffic fatalities and severe injuries, while increasing safe, healthy, equitable mobility. Part of this proactive, preventative approach, which prioritizes traffic safety as a public health issue, is partnering with micromobility companies to implement citywide programs.
That includes implementing safe infrastructure to make riding safe. Studies show that protected bike lanes effectively integrate micromobility into local transportation networks because they separate people on bikes and scooters from car traffic, making riders safer.
“Protected bike lanes also make riders feel safer, which in turn increases ridership,” says Tan.
Beyond bike lanes, micromobility companies will need to work with cities to ensure parking infrastructure is available for micromobility on every block. This is what’s needed in order to better integrate shared scooters and bikes with local transportation networks. Companies will also need to continue sharing ridership data so transportation planners can pinpoint the best locations for these improvements.
“We learned from micromobility pilot phases that curfews only set us back in the long run,” Tan says, noting that policies like curfews reduce access and run against cities’ long-term climate and mobility goals. “People on scooters and bikes should have the right to travel at night just as people in cars do.”
Riding curfews unfairly penalize residents who may not own a car or have other travel options, or those who simply choose to use a more sustainable mode of transportation. They may also increase congestion. This is why close collaboration with cities is so important.
“Rather than restrict shared bikes and scooters at night, Veo seeks to work with its city partners to keep riders safe while maintaining transportation access,” he explains. “This means providing cities with ridership data to identify ideal locations for protected bike lanes and supporting the installation of such infrastructure.”
Cities also need to consider the micromobility companies they partner with — the safety of the vehicles is of paramount importance, Tan says. Veo’s vertically integrated business model, combined with Tan’s experience as a mechanical engineer and Trek bicycle designer, makes safety innovation a core part of the company’s product design. In its latest deployments of scooters and bikes, Veo has implemented turn signals, enhanced suspension, bright underdeck lighting and advanced geofencing — features that not many other micromobility companies have added or prioritized.
Increasing ridership with mixed fleets
One of the challenges of implementing a micromobility plan is selling it to people who feel locked into their current commute methods. Data shows that mixed fleets are among the best ways to increase ridership, Tan says.
While some micromobility programs offer just one type of vehicle — usually a standing scooter — the company’s research indicates that cities can increase access by offering a variety of vehicle types. For example, underrepresented groups such as older riders and women often prefer seated scooters and throttle-assist ebikes. These vehicles have larger tires, a lower center of gravity, and don’t require the need to stand or pedal, which helps riders who are dressed for work and those who simply want a more balanced ride. Data backs up demand for a seated model: Seated scooters are used 23% more often in markets where both standing and seated scooters are available.
“Every city should prioritize offering a mix of seated and standing vehicles, such as standing scooters, seated scooters, and ebikes to get more people riding,” Tan says. “Giving riders options increases demand and supports revenue. Our most successful markets offer a mix of vehicle types to increase access and meet the needs of a diverse rider base.”
Veo’s priority is to design, develop and deploy innovative micromobility fleets that welcome riders of all ages and abilities, Tan says.
The company recently unveiled the Apollo, a class II e-bike, based on direct customer feedback and industry research to increase the accessibility of its fleet. Designed to increase ridership, it addresses two previously unmet needs in the shared micromobility space: two-person capacity and a cargo storage system. The vehicle will debut in select markets in spring 2023.
“We constantly think about how we can open up micromobility to new trip purposes, like safe tandem riding and carrying cargo,” he says. “We’re also working on tackling challenges like seasonality, and how we can increase accessibility to open up micromobility to an even greater segment of the population.”
Business models for the long haul
As the micromobility industry matures, many high-profile companies are struggling to become financially resilient, resorting to laying off staff, exiting markets, and sometimes hiring contractors to run their field operations. This financial instability fundamentally undermines confidence in the industry as a whole, as well as cities’ ability to count on the private sector to reliably provide crucial transportation services.
Veo is demonstrating that there is a financially viable business model available today. By maintaining in-house operations, a vertically integrated supply chain, rapid product iteration and a disciplined growth strategy, the company has been able to take in more than it spends. For the company, profitability has also meant offering durable mixed fleets of vehicles and responsibly selecting markets.
“We have a playbook to operate in each city at a profit,” said Tan. “That means not only taking a look at each location’s ridership potential, but also at the policies that guide each city’s micromobility program. When we sign a contract in a city, we hire local-in house staff and make plans for five, ten years ahead, so our decisions are based on how we can thrive there for the long haul.”
Veo also looks at whether the city offers limited vendor contracts, encourages mixed fleets of vehicles, and if its regulatory environment allows companies to optimize vehicle deployment in order to meet ridership demand.
Looking to the future
As the micromobility industry matures, micromobility holds promise to become a fixture in the sustainable transportation systems of tomorrow.
“If cities and micromobility companies work together to get more people out of cars and onto shared scooters and bikes, micromobility has the potential to address climate change and increase transportation access at scale,” Tan says. “We say it’s a challenge and a privilege to help solve some of the most important and complicated problems of the 21st century.”
To learn more about Veo’s evolving, innovative fleet, sustainable business plan and vision for the future of micromobility, sign up for the company’s newsletter.
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