Landlords Love the Electric Scooter Revolution
Scooter startups like Bird and Lime have found new friends in commercial real estate.
When I was in Bulgaria to visit family last week, there were a number of things that caught my attention.
The first was the fact that there were ads for Black Friday all over the place even though Bulgaria (obviously) does not celebrate Thanksgiving. The second was that Lime’s electric scooters were all over the city of Sofia. Thanks to their international expansion efforts, startups like Lime and Bird have built a global presence and boast private valuations that exceed $2 billion.
In a deep dive published this morning, my colleague Rey Mashayekhi explores the relationship between micro-mobility startups and real estate behemoths. The result is a mutually-beneficial business relationship that’s becoming more common.
The latest to jump on the electric scooter bandwagon? Commercial real estate owners. From the story:
In e-scooters and micro-mobility schemes like bikeshares, real estate developers and investors see a solution to the car parking conundrum. At Fortune’s Brainstorm Tech conference in July, Lime chief business officer David Richter said he’s “been surprised at the degree to which real estate entities want [micromobility] to happen.”
“They will get greater value from the real estate they already own because they will not have to allow ‘X’ number of parking spaces for people who are either residing or leasing space [at their properties],” Richter said.
Magnolia Capital’s Friedeck echoes that sentiment. “If you’re developing [real estate] projects, partnerships with micromobility companies give you better flexibility to reduce the number of parking spaces that you have to put in at a building,” Friedeck says. And with more urban-dwelling millennials eschewing car culture altogether in favor of more a walkable lifestyle, it gives residents who don’t have a car more options, he adds.
But perhaps the most interesting part of this story is the willingness on behalf of the landlords to embrace a new, unregulated industry that’s often under attack from city officials.
As Charles Lancaster, of Washington, D.C.-based developer Gould Property Company, put it: “The way to be part of the future is to embrace future technologies—so that we can disrupt ourselves.”
INSURANCE IS (STILL) SEXY: The insurance unicorn club has a new member. Wefox Group, a Berlin-based insurtech startup, is raising $110 million in a second tranche of Series B funding, according to TechCrunch. The deal will reportedly give the company a pre-money valuation of $1.65 billion. The extension is being led by OMERS Ventures with Merian Chrysalis, Samsung Catalyst Fund and Mundi Ventures participating.
This makes WeFox the sixth insurance unicorn, joining Root Insurance ($3.65 billion), Oscar Health ($3.2 billion) Lemonade (valued at $2 billion+), Clover Health ($1.2 billion), Next Insurance ($1 billion), and Hippo ($1 billion).
Why is this category suddenly so hot? Chris Olsen, whose firm Drive Capital backed Root Insurance, recently told me: “Technology is enabling different data sets to be very quickly integrated and ingested into pricing models. The startups have an advantage over the incumbents because they’re willing to experiment with new models of risk.”
A NEW MODEL FOR VC: Operator Collective, a new fund, counts more than 100 operators and first-time investors as its limited partners. (The fund has not yet officially closed but currently stands at $45 million.) Notably, 90% of these LPs are women, and more than 40% of them are people of color. And yes, 77% of them have never invested in tech, though they are fully steeped in the industry.
“We didn’t build this like a traditional VC firm,” says Mallun Yen, founder and general partner at Operator Collective, and a long-time tech exec who has helped scale multiple Silicon Valley companies. “We wanted to turn the model on its head.”
Polina Marinova
Twitter: @polina_marinova
Email: polina.marinova@fortune.com