Bird’s Scooter Business Implodes
Bird, the electric scooter company, is grappling with significant financial hurdles and recently found itself delisted from the New York Stock Exchange (NYSE). The situation has raised concerns about the company’s future prospects.
Bird’s troubles extend beyond its stock exchange woes. The company lost its bid to secure the domain Bird.com and had to settle for Bird.co. Additionally, it has faced a tumultuous journey since its early success.
In 2019, Bird managed to raise an impressive $500 million, with a valuation of $2.5 billion. However, it soon became clear that the company was part of a wave of overvalued firms created by venture capital firms.
Bird’s decision to go public through a merger with a Special Purpose Acquisition Company (SPAC) also raised eyebrows. Historically, very few companies that have gone public through SPACs have performed well, making this a concerning move
Adding to the uncertainty, Bird appointed Michael Washinushi as interim CEO in August, a move that often raises questions about a company’s stability. Washinushi, who had previously served as CFO, joined Bird in January and was part of the leadership during the company’s struggles
Bird had a weak excuse about its delisting. “The Company does not believe the current market cap is reflective of the intrinsic value of the business and intends to appeal this determination by the NYSE.” Hundreds, if not thousands, of investors do not agree. They have driven the stock from a 52-week high of $11.50 to $.90.
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In the most recent quarter, Bird had a mere $48 million in revenue, down 28% from the same period the year before. It lost $9.3 million.
Bird describes itself as a company that will make cities more “livable,” presumably because they do not have to drive cars. Its scooters also improve safety, which is hard to prove. Cars seem safer than scooters.
Does Bird survive another year? Only if it can raise a lot more money. Its business model and financial results will make that hard. (These are the 13 biggest electric vehicle business failures in American history.)
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