binarypublishKey Points:
- E-scooter startup Superpedestrian is shutting down its U.S. operations due to financial reasons and considering a sale of its European business.
- The company raised $125 million in a Series C round from investors such as Jefferies and Antara Capital 18 months ago, but those efforts appeared to have been insufficient to keep the business afloat.
- The closure illustrates the challenges confronting e-scooter startups despite the sector’s technological advancements.
Superpedestrian, an e-scooter startup known for its unique self-diagnostic and safety software, has announced its U.S.-based operations will cease by December 31, due to financial constraints. The company’s director of U.S. operations, Alexander Berg, shared the news with his team in a virtual meeting. The recent decision underscores the ongoing issues faced by companies in the e-scooter industry, even as they leverage technology to differentiate themselves from competitors.
Superpedestrian exhibited some promise in the industry, raising $125 million in a series C round of equity and debt financing. The fundraising round saw participation from investors such as Jefferies and Antara Capital, who provided loans using the company’s assigned patents as collateral. Nevertheless, the funds raised were evidently insufficient to ensure the company’s sustained operations.
Challenges in the e-scooter field have been apparent, with Bird’s valuations falling after going public and layoffs at Superpedestrian. Such difficulties have raised concerns about the long-term viability of shared scooter operations in the current market environment. This development further illustrates these issues, emphasizing that technological innovation is not sufficient for financial sustainability.
Superpedestrian aimed to differentiate itself from the pack through its technology, particularly its self-diagnostic and safety software. The company enhanced its technological capabilities through the acquisition of Navmatic in July 2021, developing a pedestrian defense safety system that detects and auto-corrects unsafe riding behaviors in real-time.
Moving forward, Superpedestrian plans to operate with minimal staff, focusing on retrieving scooters from various cities and storing them in warehouses over the next couple of weeks. Its U.S. operations will be affected the most by the shutdown. Meanwhile, the startup is exploring potential opportunities for selling its European operations.
