German electric power scooter rental company Tier announced on Tuesday that it had raised $ 250 million in a financial cycle led by SoftBank’s Vision Fund (Vision Fund II)
It is the first time that the Japanese technology investor has made a bet on a scooter-sharing space and it has come as many European countries are also installing lockdowns to reduce recurrence in coronavirus cases. E-scooter companies were hit hard by the first round of closures, with dozens of suppliers killing jobs to survive.
COVID, SoftBank And Tier
For its part, Tier says it does not need to undertake any retrenchment related to the epidemic. A CNBC spokesman told CNBC that the company was “making one or two changes related to operations as part of a general business but nothing but that.”
SoftBank made an investment in Tier through Vision Fund 2, which followed $ 108 billion into its first technology fund which gained notoriety for its problematic betting on WeWork office rental service. The round also attracted the support of existing investors including Mubadala, Northzone, Goodwater Capital, White Star Capital, Novator and RTP Global.
However, Mubadala did not invest in Tier as part of Vision Fund 2. The Abu Dhabi Royal Fund donated the first Vision Fund to SoftBank, but – as CNBC reported in May – was reluctant to support the new fund.
According to the Financial Times, which first reported the news, Tier is now estimated at just under $ 1 billion. That means it’s close to getting a so-called “unicorn” and, according to FT, making it the second most important e-scooter company behind Bird – beyond Lime.
Tier’s Profitability
Some e-scooter beginners say they have seen a rapid recovery in demand in the summer as the economy reopens. Many have been rushing to take part in the UK tests as the country prepares to officially launch e-scooters.
But there are still fears about the financial stability of the sector, especially as many European countries enter and where winter routes enter. However, Tier says he was able to make a profit for the first time this year.
Tier has been profitable since June, the company’s CEO Lawrence Leuschner told CNBC in a recent interview. “We will be very close to the full profit this year,” he added.
Tier said he would use the new money to expand to Europe and install thousands of charging stations in different cities to generate their cars. The company, in May which launched its moped gas-sharing system, said it was also looking to protect extra debt from other vehicles.
“Small transit closes the huge gap left by the use of urban vehicles and presents another viable alternative to legacy travel plans,” said Yanni Pipilis, chief executive officer of SoftBank Investment Advisers. “Tier has a proven track record in establishing long-term relationships with cities and regulators, including a state-of-the-art approach to advancing leading customer suggestions.”
