Bird, a prominent provider of electric scooter rentals in cities, is set to have its stock trading suspended on the New York Stock Exchange (NYSE) due to a failure to maintain a market capitalization above $15 million for 30 consecutive days. Starting Monday, the company’s shares will be traded on the over-the-counter exchange.
Boom and Bust of Electric Scooters:
Before the pandemic, electric scooter and bike rentals gained popularity as a convenient alternative to public transit and ride-sharing services. During this period, venture capitalists invested heavily in various growth areas, even if they were not profitable. Bird, in particular, secured over $500 million in funding and achieved a valuation of $2.5 billion in a 2019 round led by Sequoia Capital.
However, the onset of COVID-19 in 2020 significantly disrupted the business as cities imposed lockdowns. Although growth resumed in 2021, the golden days of rapid expansion were over.
A Rocky Path to Public Markets:
In 2021, Bird went public through a merger with a special purpose acquisition company (SPAC). Despite its public debut, the company’s financial performance continued to deteriorate, with its net loss ballooning from $215 million in 2021 to $359 million in 2022, while revenue increased by 28% to $245 million during the same period.
The company’s stock has experienced an 80% decline in value this year, closing at just 90 cents on Friday, resulting in a market capitalization of $11.6 million. To address this, Bird initiated a 1-for-25 reverse stock split in an attempt to lift the stock’s price above $1.
Changing Leadership and Acquisition Moves:
In June, Travis VanderZanden, a former executive at Lyft and Uber who founded Bird in 2017 and was often referred to as the “electric-scooter king,” departed from the company.
Recently, Bird acquired scooter startup Spin for $19 million, including $10 million in cash.
A Message of Resilience:
“We firmly believe that BRDS current market cap does not reflect the intrinsic value of the Company,” affirmed Michael Washinushi, Bird’s interim CEO. “And while disappointing, this change in our listing status on the NYSE does not alter our commitment to our shareholders, our valued employees across Bird and Spin, our partners, and the many global cities and institutions with which we work.”
As Bird navigates these challenges in the electric scooter market, its journey continues with a new listing and a commitment to realizing its potential.
