Google parent Alphabet backs controversial $1.1bn electric scooter startup critics say is ‘turning cities into a nightmare’
- Alphabet has invested in scooter service Lime as part of $300m funding round
- Google Ventures previously invested in start-up and reportedly leads funding
- Lime is now valued at around $1.1billion despite criticisms from local residents
Google’s parent company Alphabet has joined a $300million funding round for electric scooter start-up Lime, despite heavy criticisms from San Francisco residents and lawmakers.
Lime had already received a hefty amount from Google Ventures, and Financial Times reports that Alphabet contributed around the same amount – though the exact figures from each have not been revealed.
However, critics of the system, and the several similar firms, have said the electric scooters are ‘a nightmare’.
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Google’s parent company Alphabet has joined a $300million funding round for electric scooter start-up Lime
The move further demonstrates the company’s interest in transportation, building off Waymo, Alphabet’s autonomous cars.
The company also has an offshoot called ‘Sidewalk Labs’, a start-up focused on developing ‘smart cities’ and tasked with improving urban transit.
The move to invest in Lime will hopefully reduce Alphabet’s dependency on profit from Google’s ads.
However, there is no guarantee that the electric scooter business will continue to thrive in San Francisco, as it faces increased regulation from the city.
Lime, along with rival startups Spin and Bird deployed their scooters in San Francisco, without permission, back in March of this year.
In May, San Francisco laid out requirements for companies seeking to obtain electric scooter permits.
The vehicles previously weren’t regulated within the city, causing anger with some residents.
Unlike bike-sharing systems, scooters don’t need to be deposited within a dock and can instead just be left anywhere.
Many riders also aren’t using helmets, causing safety concerns.
The move to invest in Lime will hopefully reduce Alphabet’s dependency on profit from Google’s ads. However, there is no guarantee that the electric scooter business will continue to thrive in San Francisco, as it faces increased regulation from the city
The upcoming permits will also come with regulations and conditions. Companies will need to prove they’re requiring riders to wear helmets as well as teaching the riders how to park the scooters so sidewalks aren’t obstructed.
The city reportedly plans to issue permits to no more than five companies during a 24-month test program.
In the first half, there will be 1,250 scooters total on the streets, with up to 2,500 in the back half.
Ride-sharing companies Uber and Lyft are also looking into developing electric scooters. Uber acquired the bikesharing start-up JUMP for around $200million in April, and Lyft applied for a permit in May.
HOW HAVE ALPHABET’S FORTUNES CHANGED OVER THE YEARS?
Alphabet, Google’s parent company, is an American multinational conglomerate company headquartered in Mountain View, California.
The company, incorporated on July 23, 2015, is a holding company.
The company’s segments include Google Inc. and its ‘Other Bets’, including Access, Calico, CapitalC, GV, Nest, Verily – a life sciences research organisation, self-driving car-hailing service Waymo, Nest products and services (a smart thermostat firm) and X, a ‘moonshot’ company aimed at launching technologies to ‘make the world a radically better place.’
On July 8, 2015, Google’s stock prices were priced at $541.7.
But in the lead up to the formation of Alphabet, stock prices surged to $699.62 on July 17, 2015 – an increase of 28.45%.
Logo with signage in front of Building 44, which houses employees working on the Android mobile phone operating system, at the Googleplex, headquarters of Google Inc in the Silicon Valley town of Mountain View, California
From July 9, 2015 to January 30, 2018, Alphabet’s stock prices rose by 116%.
Alphabet’s current stock price is $1,181.59, although the tech giant’s shares slid 2.3% in after-hours trade on February 1, 2018 following Alphabet’s reported loss of $3 billion (£2.1bn) for the fourth quarter of 2017, as it set aside $11 billion for taxes – an estimated $9.9 billion (£6.9bn) was for taxes on repatriated earnings.
The vast majority of Alphabet’s revenue continues to come from Google and its various business, most notably its advertising network – revenue from Google’s ad business grew by 21 per cent from last year and accounts for 84 per cent of Alphabet’s total revenue.
However, the company’s so-called Other Bets saw revenues rise from $262 million (£183m) last year to $409 million (£286m) in the last quarter.
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