Strangely, Uber Inc. is in negotiations to buy an electric-scooter sharing company called Bird.
The ride-hailing app giant held negotiations with a scooter-rental company called Bird on a possible multibillion acquisition. However, Bird CEO Bird CEO Travis VanderZanden says his company is not for sale, The Verge claims.
Besides Bird, Uber is considering buying a scooter-rental service called Lime, The Information claims. Moreover, The Verge claims Uber owns a stake a small stake in Lime.
Bird claims to offer scooters in over 100 cities and have 50,000 free helmets available for its riders. In particular, Bird offers an app similar to Uber’s that lets people rent scooters on the go.
Does Uber Really Care about Electric Scooters?
Notably, Uber may not care about scooters at all. Instead, Uber could want Bird’s app and platform to apply them to self-driving electric rental cars.
Thus, Uber could plan to set up a service like Zipcar. To explain, Uber will park autonomous hire vehicles on the streets. The self-driving Uber vehicles will drive themselves to people who hail them with an app.
Furthermore, Uber can save money by using electric cars that automatically plug themselves into charging stations. Markedly, Tesla Motors (NASDAQ: TSLA) has posted a video of a self-charging electric car on YouTube.
Thus, nobody will need to keep the gas tanks full one of the main drawbacks to current short-term rentals. Obviously, that will reduce labor costs and eliminate the possibly of the rentals running out of gas.
Why Electric Scooters are a threat to Public Safety and Public Health
I think avoiding electric scooters will be a smart move for Uber because the obnoxious vehicles are a massive lawsuit and public-relations nightmare waiting to happen.
To clarify, I think all it will take for cities to ban scooters is the death of one child. Just a few minutes of news footage a grieving mother blaming scooters for her child’s death will cause city councils will turn on Lime and Bird.
Additionally, scooters are a public health threat because they reduce the amount of exercise people get. In particular, the Centers for Disease Control and Prevention (CDC) reports only 23% of adults get enough exercise.
Under those circumstances, I have to wonder when some fat person will sue Bird or Lime blaming them for her Type II diabetes. Hence, cities will be wise to ban electric scooters completely.
However, companies like Lime and Bird could have technology Uber will use. If Uber CEO Dara Khosrowshahi is smart, he will take Elon Musk’s advice and scrap the scooters if Uber buys Bird or Lime.
Uber has Ticker Symbol and $120 Billion Valuation
Uber has a $120 billion valuation and a ticker symbol, Reuters reports.
Uber will reportedly trade under the UL symbol. However Reuters did not reveal what exchange Uber will trade on.
Uber is planning an initial public offering (IPO) of $120 billion, The Wall Street Journal claims. Goldman Sachs (NYSE: GS) and Morgan Stanley are reportedly being lined up to lead the IPO.
Therefore Uber is probably worth $120 billion if The Journal is correct. Conversely, Uber is still far from the world’s most valuable unicorn. In detail, a unicorn is a pre-IPO company.
Sorry Uber Fans, Finance is still more valuable than ride-sharing
Currently, the Chinese fintech company Ant Financial Services is the world’s most valuable unicorn. In June, CNN and other news outlets valued Ant at $150 billion.
To explain, Ant Financial is the Alibaba (NYSE: BABA) spinoff that operates Alipay and other digital financial services. The best way to think of Ant Financial is as the PayPal (NASDAQ: PYPL) of China.
Like PayPal, Ant Financial offers digital wallets, loans, lines of credit and other financial products. Hence, finance is still more valuable than ride-hailing.
That is why Khosrowshahi is so keen on acquisitions. Despite its glamor Uber needs bigger sources of cash like scooter companies and their technology.