Updated: May 14
18 startups, from various countries and with war chests of very different sizes, have been officially authorized to allocate their electric scooters in Madrid. In total 8,600 "patinetes",as they are called by the Spaniards, will be available to rent in Madrid in the coming weeks.
In total, 25 startups applied for the privilege of being a green yet fast transportation alternative for the consumers in the Spanish capital. The 18 selected are:
9. Flash (Germany), 10. Mobike (China), 11. Ari (Spain), 12. Tier (Germany), 13. Alma, 14. Lime (San Fransisco), 15. Motit4u (Spain), 16. Wind Mobility (Germany ), 17. Jump (by Uber), 18. SJV Consulting (Spain).
Maybe not so surprisingly, at least 7 of these Mobility startups are founded in Spain. But just having the right nationality didn't help the well-known Spanish startup Cabify who was 1 of the 7 companies who were left out from the roads. The other 6, who were denied permission for not complying with the requirements, are Bird, Donkey, Movo, Cabcar, Taxir and Mygo.
Asked for 108,000, got 8,600
The applicants wanted to deploy a combined number of 108,000 scooters in the city. Right now it looks like the allowed quantity of 8,600 will be even below the limit of 10,000 scooters previously established by the Madrid authorities. It is reported that 3 additional applications are still being reviewed so a few hundreds more can still be available in the coming months.
A re-cap on the Spanish scooter drama
When re-capping on this Spanish scooter drama, the restriction from the Madrid authorities might not be as harsh as you first might think. Bare in mind that 3 companies - Lime, Wind and VOI - were allowed to start operations as a pilot project, before any regulations were in place. American Lime came first, enjoying a first mover advantage in the summer of 2018.
With great power comes great responsibility, as the saying goes. But apparently, the exclusive benefit of renting out electric scooters in Madrid, enjoyed by these 3 startups, wasn't honored. The city council of Madrid says it told these 3 startups that they must adjust their apps to ensure they were used in appropriate areas and not left to block pavements.
“They were given a deadline and told that to continue they had to fulfill a series of conditions, including avoiding agglomerations and that the start and end of rides must take place in permitted areas,” said Inés Sabanés, Madrid city environment and mobility coordinator.
In the beginning of December last year, having failed to comply with the regulations, the city of Madrid lost its patience and ordered a removal of all electric scooters within 72 hours.
Forgiven but not forgotten
Although Lime, Voi and Wind have now been given a second chance, looking at their share of scooters it seems their previous sins are by no means forgotten. Wind has only been given 136 licenses, Voi 162 and Lime 641.
The biggest chunk was given to 4 new companies which together have captured half of the licenses. None of them have operated in Madrid before.
Taxify is a Estonian company with €155 million of investment without a local team in Madrid as of yet. Flash is a Berlin-based company with €55 million of investment created by the founder of Delivery Hero, already operating in Switzerland and Portugal.
Koko is a Madrid-based company that began operating in Zaragoza. SJV Consulting, getting the largest piece of the scooter pie, is a consultancy dedicated to the "business management and intermediation in national and international Real estate operations". The answer to why they got so many of the licenses seems to be a bit of a mystery as of today.
3 strict rules to follow
After carefully analyzing the challenges and the environmental-friendly opportunities imposed by these new, slim urban vehicles, while also making sure to keep all people safe, the city Council of Madrid demanded 3 things:
1. The authorized companies must have insurance for the users.
2. All scooters must have Geolocation and GPS capabilities installed.
3. Prevent scooters from being parked in zones were scooters are not allowed to circulate.
By complying with these rules the 18 startups managed to get their permission to start operations. However, in order to also keep it they must commit to moving their fleets daily, so that every morning the scooters are parked in the correct neighborhoods, according to what is outlined in their respective permit.
Which companies are still operating in 6 months?!
It will be very interesting to follow the development of this battle of the e-scooter companies in the strategically important city of Madrid. The Spanish capital is in great need of reducing pollution and wanting to offer more eco-friendly alternatives to cars as they are implementing a strict car restriction in the centre of Madrid.
Only cars with the 0 and Eco stickers, (stickers are mandatory from April 24), will be able to park in regulated parking spaces in Madrid’s streets today (the green and blue zones).
But the money driven approach of "go big or go home" doesn't seem to apply here with such big players like Cabify and Bird being kept out of the race (for now anyway).
The winners will need to make a huge effort to keep the authorities happy and the citizens of Madrid safe from being hit by a tampered scooter running amok (as in the case of the tragic death of an old woman in Barcelona.)
First we take Madrid and then the rest of Spain?
Maybe the strategy is to win the majority of the market share of scooter-cruising Spaniards in the capital first and then claim their fame in the rest of Spain. Not knowing what these clearly business savvy green tech startups are planning, I wonder if they have all taken into account all the different rules and regulations in the 17 autonomous regions in Spain.
Part from taking into account the local differences of the Spanish regions, here are some other tips from 4 international startups who already have expanded to Spain.
Did you find this interesting? Do you agree? Or disagree? I so love an interesting conversation and would love to hear your thoughts. Please do leave a comment!!
Crafted by Caroline Lagergren.
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