At Superpedestrian’s all-hands meeting ahead of Thanksgiving, CEO Assaf Biderman announced that the electric scooter company was preparing for fresh funding and a merger. While management anticipated announcing the news on January 1, the company needed to tighten its belt in the meantime, leading to job losses for a few employees and executives in Europe. Less than a month later, Superpedestrian ceased operations.

The company’s closing mirrors other shared scooter businesses such as Bird, Micromobility.com, Tier and Spin, which are all struggling. Each of these companies faced similar obstacles that contributed to their downfall, including adverse city regulations, high operational costs, and hiring more staff due to VC funding without the revenue to support them.

According to several former employees, the shutdown came as a shock, with little transparency from leadership. Superpedestrian, a spinoff from MIT’s Senseable City Lab that launched shared scooters in 2020, faced immediate financial problems despite obtaining loans from its backers, Jeffries and Antara, in July and October.

Superpedestrian’s former employees blame its failure on several factors from lack of investment in marketing and winning proposals to a lack of coherent leadership and venture capital backing. It also failed to staff its policy proposals team with people who could form relationships with city officials and attract riders. The company was unable to attract enough riders and failed to win adequate city permits in revenue-generating markets.

The failure also came because the CEO was too focused on selling software instead of understanding that city permits were valuable. A shift in business culture also resulted in Superpedestrian cutting corners with compliance and overpromising returns to investors and cities. Ultimately, these realities led to less profit and more expenses, causing the startup to shutter its operations.

By admin