The Electric Scooter Startups Invading Latin America
The global electric scooter market is expected to reach US$28.56 billion by 2025.
In Latin America, grabbing an electric scooter for short-distance trips is a fairly new phenomenon.
While U.S.-based electric scooter startups like Bird and Lime have expanded quickly and raised millions of dollars over the past few years, Latin America didn’t see its first electric scooter startup launch until early 2018.
Based in Mexico City, Grin was the first startup to take the plunge in Latin America, deploying its scooters on the streets of the capital city after receiving funding from the prestigious Y Combinator.
However, Grin wasn’t the only transportation startup to notice the enormous potential in Latin America.
Many large cities in Latin America, such as Mexico City, Bogota, and São Paulo, are known for crippling traffic congestion during peak hours.
Not to mention, many of the public transportation systems struggle to support their increasing populations. It’s normal for transportation systems in Latin America’s densely populated cities to run above capacity during peak hours, often making public transportation a stressful and unpleasant experience.
These issues have led to an increasing number of alternatives to traditional public transportation systems, including ride-hailing, bike sharing, car sharing services, and more.
According to Reuters, Mexico and Brazil are two of Uber’s biggest markets globally.
Bike sharing programs are now available in nearly every mid- to large-sized city in Latin America. And in just a few short months, competition in the electric scooter space is already heating up.
Here’s a look at the electric scooter companies actively expanding across Latin America.
Launched in July 2018, Grin currently only operates in Mexico City. However, the company has plans to expand to other cities throughout Latin America.
In a span of just a few months, Grin received backing from Y Combinator, raised US$45 million in one of Latin America’s largest Series A rounds, and merged with São Paulo-based Ride to further the company’s expansion across Latin America.
Ride will operate under the Grin brand in Brazil and manage Grin’s operations in Brazil.
Bird scooters first hit the streets of Santa Monica, California in 2017 and quickly expanded to other local and global markets.
The scooter startup was recently valued at US$2 billion after a $300 million round of financing earlier this year.
In October 2018, the company announced its expansion into Mexico City, its fifth city outside of the U.S., rolling out 100 scooters to start. Bird also announced it has plans to launch in Brazil next.
Another electric scooter pioneer, Lime, has expanded to 72 cities globally, including Mexico City, since its first launch in June 2017.
This year Lime plans to launch in 50 new cities internationally.
Cosmic Go was one of the first electric scooter startups on the scene in Colombia, rolling out 100 scooters on the streets of Bogotá’s busiest neighborhoods in November 2018.
The company plans to launch next in Medellin, Barranquilla, Cartagena, Santa Marta, among other cities in Colombia.
The startup quickly raised a US$12.3 million seed round in April 2018 and a US$63 million Series A round in October 2018, the largest Series A round ever for a Latin American startup.
The funding will help ready the company for its expansion across the region.
With an investment from Spanish ridesharing giant, Cabify, Movo plans to launch its electric moped scooter sharing service across Mexico, Peru, Colombia, Chile, and Spain.
While there is still no exact launch date, it’s estimated that 20,000 scooters will be available in Latin American cities and Spain.
Movo will be entering an already-crowded space, and it remains to be seen if its partnership with Cabify will be able to accelerate its adoption in Latin America.
Joining Yellow and Ride, Scoo is another Brazilian electric scooter company founded by Marcelo Duarte, a São Paulo entrepreneur. During a trial period from August to October 2018, Scoo recorded 15,000 trips.
Though the company declined to say how many scooters it has available on the streets of São Paulo, it’s estimated they are operating with at least 1,000 scooters.
With US$1 million in funding, Scoo plans to run tests in Rio de Janeiro next and expand to other capital cities next year.
San Francisco-based Scoot is another electric vehicle company to watch in Latin America.
With an existing fleet of electric bikes and electric mopeds, the company recently selected Santiago, Chile as its third market to launch its electric scooter service in October 2018.
After a successful launch in Barcelona, Spain, the company secured a partnership with the Mayor of Santiago and was permitted to enter Chile with a fleet of up to 500 electric scooters to start.
In May 2018, Uber acquired bike-share startup, Jump, for a rumored US$200 million. Though the company focuses on bikes, Uber hopes to expand its mobility options to include electric scooters.
The company operates in 10 cities in the U.S. but recently announced it plans to launch an electric scooter service in Mexico and possibility Brazil in the first quarter of 2019.
There are few specifics, however, Uber’s Vice President of New Mobility, Rachel Holt, said they’ve been speaking with local governments in Mexico and see big opportunities in the region.
Real solution or just a fad?
2018 was certainly the year of the electric scooter around the world, though most of the scooter activity in Latin America occurred during the last few months of the year.
In 2019, it’s likely we’ll continue to see startups drop scooters on Latin America’s streets, with or without permission. With that said, it’s still too early to tell whether or not electric scooters are a viable solution for short distance commutes in Latin America – and whether or not Latin America’s already congested cities can support a heavy presence of scooters.
However, the companies working with local governments and partners are likely to have the best chances for success as they expand aggressively across the region.
Did we miss any electric scooter startups in Latin America? Share them with us in the comments.