Uber is cash flow positive and Bolt… bolts
This is the day we make it happen
Hello and welcome to Oversharing, a newsletter about the proverbial sharing economy. If you’re returning from last time, thanks! If you’re new, nice to have you! (Over)share the love and tell your friends to sign up here.
Getting there.
Congrats to Uber Technologies Inc. for turning cash flow positive for the first time ever in the second quarter, 13 years after it was founded and three years after its IPO. Better late than never, as they say. Uber’s stock is up 19% in afternoon trading, to more than $29 a share, after generating $382 million in free cash flow, a mirror image of the -$398 million in free cash flow it reported in the same period last year. Uber also posted $364 million in adjusted ebitda, its preferred measure of profitability, but net income of -$2.6 billion on a GAAP basis. Revenue beat expectations in both mobility (rides) and delivery, which jumped 120% and 37% from Q2 2021, respectively.
Uber CEO Dara Khosrowshahi told investors on the quarterly earnings call that the current tough operating environment (see: tech selloff, gas prices, inflation) “is the strongest we felt competitively globally” since he took the reins in 2017. “In a different environment, the platform advantages that we brought—the scale advantages, the global advantages that we brought—to some extent sometimes were kind of outshouted by just higher spend by competitors,” he said. “So in an environment where capital discipline becomes more important, I think the larger players—and we are the largest players; the most diversified players—and we're definitely more diversified than anyone else as far as the kinds of businesses that we are and our global footprint; and then the players who have true platform advantages—which, again, as Uber—really start coming to the floor.” More on Uber’s earnings in tomorrow’s subscriber-only issue of Oversharing, upgrade your subscription!
Scooters!
One way to shut down a micromobility service is to gather up all your hardware, email customers, and notify local transit authorities that you’re closing up shop. Another is to just ghost and hope people figure it out. E-bike and e-scooter startup Bolt Mobility is apparently going with the latter strategy, according to TechCrunch:
Bolt has stopped operating in at least six U.S. cities, including Portland, Oregon, Burlington, South Burlington and Winooski in Vermont and Richmond, California and Richmond, Virginia, according to city officials. Some city representatives also said they were unable to reach anyone at Bolt, including its CEO Ignacio Tzoumas.
Bolt Mobility, not to be confused with the Estonian ride-hail firm or the Indian EV charging network, is an e-bikes and e-scooters provider co-founded in 2018 by sprinting legend Usain Bolt and valued at a modest $52 million. Bolt isn’t a big U.S. scooter player like Bird or Lime, but it operated in a handful of bigger cities like Portland and Washington D.C., and gained access to dozens of smaller markets through its purchase of Last Mile Holdings in January 2021.
TechCrunch’s attempts to reach Bolt were reportedly unsuccessful, with even the company’s customer service line going unanswered. Local officials haven’t had much better luck. Bryan Davis, a senior transportation planner for Chittenden County, Vermont, told TechCrunch Bolt halted operations on July 1 but let the county know a week later. “They’ve vanished, leaving equipment behind and emails and calls unanswered. We’re unable to reach anyone,” Davis said, adding that Bolt left behind 100 inoperable bikes with dead batteries. Richmond, California, mayor Tom Butt wrote in an email forum on July 23 that Bolt “went out of business without prior notification or removal of their capital equipment from city property.” The city is working on a plan to remove the abandoned devices, Butt wrote, and is “asking people not to vandalize the bikes pending a resolution.”
This is obviously bad behavior, the startup equivalent of a hit-and-run. But also what do you expect from the scooter economy, a business grounded in the ride-hail model of launch first, ask permission later, and grow at all costs? In the early days these strategies led to bikeshare graveyards and regulatory sparring (never forget that Bird CEO and former Uber and Lyft employee Travis VanderZanden notified Santa Monica’s mayor of the company’s launch by LinkedIn message) and fleets of scooters that didn’t last long. These days the hardware is better and things tend to be more regulated, with RFPs, tenders, and oversight by city officials who learned the hard way from ride-hail and home-rentals that well-funded startups with an eye on disruption can’t always be bothered with details like, you know, obeying the law. But sometimes it’s still the Wild West! Bolt was all over the map: failing to pay fees in Portland, renewing a license in Chittenden County before vanishing a few months later, missing check-in meetings in Richmond. Whatever the reason, Bolt bolted and, in the perfect bookend to a scooter saga, left everyone else to clean up the mess.
Burn notice.
Two months after laying off 300 employees, calling it quits in four countries, and exploring a possible merger or sale, ‘instant’ delivery startup Gorillas is set to raise another $250 million from existing investors, Business Insider reported. When we last checked in with Gorillas in late May, the startup reportedly had $300 million left in the bank but was burning as much as $75 million a month and owed significant outstanding debts to suppliers. In addition to pulling out of Italy, Spain, Denmark, and Belgium, Gorillas paused plans to expand to Los Angeles and Chicago and to open new dark stores in New York City. Internally, spending cuts designed to help pivot from “hyper growth” to profitability meant no more unregistered Apple products for employees and a crackdown on promo codes for customers.
The rescue funding will reportedly come with a lower valuation than the $3 billion pricetag Gorillas last raised at in September 2021. While $250 million is obviously a lot of money to throw at a startup that has so far mostly proven capable of setting it on fire via customer incentives, splashy ads, and wasted inventory, it’s a lot less than the $700 million CEO Kagan Sumer previously told Bloomberg he hoped to raise this year. Investors leading the new funding round include Coatue and Dragoneer, each of which took part in Gorillas’ series B and C financings (Coatue was also in A). In the meantime, I can report that Gorillas would still deliver me a single £4 Belgian chocolate brownie for a total of £3.99 in fees were I in theory to place such an order, and that new user promo code GIVEME20 for £10 off orders of £25 or more, which was supposed to expire on July 7, is still alive and well in my app, so go crazy.
Other stuff.
The deadliest road in America. Gig Workers Are Losing Their Hard-Won Rights. There’s a Maddening Omission in the Senate Climate Bill. India's Ola and Uber deny report of merger talks. Uber plans to sell 7.8% stake in Indian food delivery firm Zomato. Uber Eats treats drivers as ‘numbers not humans’, says dismissed UK courier. Uber’s grocery strategy is too “slow” according to supply chain expert. Uber’s posh electric car service is coming to more cities. Uber expands ‘upfront fares’ for drivers. Self-Driving Truck Accident Draws Attention to Safety at TuSimple. Kenyan logistics startup Sendy cuts 10% of its workforce. Ottonomy.io raises $3.3 million to expand network of autonomous robots for deliveries. FTC slams Opendoor with $62 million settlement over false advertising claims. Landlords evicting tenants for Airbnb and holiday lets, report finds. English Dott sustainability report. Interstate Travel Post-Roe Isn’t as Secure as You May Think. Doctors in Houston can prescribe you a bike. The human cost of dark stores. Uber for landscaping. Midwestern things, according to Airbnb listings. Sheryl Sandberg and the Crackling Hellfire of Corporate America. The chicken sandwich gets a makeover. Consider the Humble Kick Scooter.