More than a half-dozen private, stationless bike-share companies are interested in opening in Seattle. They don’t want tax money, but the companies have no precedent in the U.S. and the city is trying to figure out how it will all work.
Seattle is preparing to become a bike-share laboratory, as more than a half-dozen private companies, funded with tens of millions of dollars in venture capital money, have contacted the city about opening stationless bike shares here.
Stationless bike shares are popular in China but basically unprecedented in the United States. As recently as a week ago, none of the companies that have contacted Seattle were operating in any other American city.
Unlike traditional bike-share models (such as Seattle’s recently shuttered Pronto), these bikes would not have to be returned to specified docking stations. They wouldn’t even have docking stations. Instead, each bike has a built-in lock on its back wheel that is opened with a smartphone app.
Use the app to find a GPS-enabled bike near you, unlock it, ride it, leave it and lock it at your destination.
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Other cities have bike-share systems with similar technology — bikes that can be locked anywhere, not just to a docking station — but they all have stations where bikes tend to be picked up and returned to.
Portland and Boise’s systems, for instance, both have bikes that can be locked anywhere. But each city also has dozens of scattered stations where it asks riders to return bikes. Riders pay an additional fee if they do not return their bike to a station.
As of last week, there were no totally stationless bike-share systems anywhere in the U.S., according to the National Association of City Transportation Officials.
That organization also recently warned of “rogue bike-share companies” that have launched without permission in cities using “flimsy equipment” and “posing significant safety risks to the public.”
Privately run, for-profit bike-share systems also are very rare, although New York City’s bike-share system, the largest and one of the most successful in the country, is privately funded.
“Transit in general, let alone bike transit, generally is not profitable,” said Paul DeMaio, a bike-share consultant who helped develop Washington, D.C.’s successful system. “That’s why usually it’s offered by municipalities or universities, because they want to serve their populations and provide a service.”
After Pronto — which started as a nonprofit with public funding and was later bought by the city — Seattle’s not devoting tax money to a bike share anytime soon.
Three private companies — Bluegogo, LimeBike and Spin — have met with city officials to talk about opening here, according to Councilmember Mike O’Brien, who chairs the city’s Transportation and Sustainability Committee.
All have bases in the Bay Area, millions of dollars in venture capital funding and signature colors (blue, green and orange respectively). All work off the same basic pricing scheme — $1 for a 30-minute ride. That’s far cheaper than most standard bike shares. Pronto’s cheapest option was $8 for a 24-hour pass.
They’ll likely get more revenue from in-app advertisements, targeted using customer data.
“A lot of folks are skeptical of what kind of business model these folks have and is it really viable,” O’Brien said. “I share that skepticism; it’s not clear. But they’re going to be experimenting on their dollar, not our dollar.”
Four other bike-share companies also have called O’Brien’s office to ask about opening here.
There are obvious advantages to a stationless bike-share system: They want no tax money, are cheaper to start, take up less space and are more user friendly — drop the bike off at your final destination, rather than searching for a docking station.
And with no stations, bikes can more easily be placed all over the city. Pronto only served downtown, Belltown, Capitol Hill and the University District.
“Our goal is really to introduce equitable and affordable bike share to all neighborhoods in Seattle,” said Derrick Ko, a co-founder of Spin. “Stationless bike share allows us to enter neighborhoods which previously may not have made sense for other forms of bike share.”
There are also obvious concerns: Bikes blocking the sidewalk, bikes clustering all in one spot (the bottom of a hilly neighborhood, for instance) and bikes that are poorly maintained.
“We’re concerned about it”
The bike-share companies are waiting on the Seattle Department of Transportation, which is working on a pilot permitting process that will set fees and regulations.
A draft permit could be completed as soon as next week, O’Brien said, and companies could potentially begin operating in July.
The regulations, O’Brien said, will be focused on making sure the bikes are safe and well-maintained and that they do not end up blocking the traveled parts of sidewalks. Depending on the location, bikes could be locked and parked on the strip between streets and sidewalks — where parking meters tend to be — or on the strip between buildings and sidewalks, he said.
“We’re concerned about it so we’re going to put some strong language in there,” O’Brien said. “It shouldn’t be on pedestrians or store owners or homeowners to go out and move these bikes out of the way.”
Fees, O’Brien said, will be modest: a couple of hundred dollars to apply for a permit, a per-bike fee in the $20 to $50 range and a couple of thousand dollars to cover staff time spent on the process.
The city also wants access to much of the data the companies will collect, so it knows things like how often and where bikes are being used. It will use that information, O’Brien said, to help decide whether the pilot permits will be extended beyond 2017.
“We reserve the right to simply say, ‘Company X you are not meeting our standards, you need to pick up your bikes in the next day or two,’ ” O’Brien said. “We want to avoid an Uber and Lyft situation where folks come in and just flaunt the laws that are on the ground.”
“Willy-nilly on the sidewalk”
It was an “Uber and Lyft situation” when Bluegogo opened in San Francisco earlier this year.
San Francisco was in the process of writing its own regulations when Bluegogo launched in the city in February. The company didn’t wait for permits to be finalized; rather it leased a bunch of parking spots, so it could launch on private property, said Heath Maddox, the bike-share program manager for the city’s Municipal Transportation Agency.
But the company did little to ensure that the bikes were returned to those parking spots, Maddox said.
“Bikes were just left kind of willy-nilly on the sidewalk,” he said. “Their bikes were showing up all over the city.”
Under pressure from the city, Bluegogo pulled all its bikes out of San Francisco in March, just over a month after the launch.
“They bungled it so badly, I think they realized the only way they were going to do things right in San Francisco was to clean up the mess and come back later,” Maddox said. “We’re expecting they will come back.”
Bluegogo did not respond to repeated interview requests.
Spin, which did a trial launch in Austin, Texas, had a more successful experience, albeit one tinged with similar issues. The company opened in Austin, with just under 100 bikes, on the first weekend of South by Southwest in March.
But, like Bluegogo, it did so without permission, according to the Austin Transportation Department.
The city ordered Spin to immediately close up shop. But Spin then worked with the city to reopen and successfully continue its trial later that week, before shutting down when the festival ended.
“It gave us a lot of good education of how this will work in the U.S.,” Ko said. “It’s a learning curve, right? We want to partner with the city to come up with a good set of regulations.”
LimeBike may be the first of the companies to get a permanent system up and running. The company officially launched a system with 125 stationless bikes at the University of North Carolina at Greensboro on Thursday.
Gabriel Scheer, director of strategic partnerships for LimeBike, envisioned people using the bikes to cover, for instance, the last handful of blocks between home and a transit stop.
“A built-out system in Seattle is literally thousands of bikes,” Scheer said. “The more options we get, the more easy it is to live a car-lite lifestyle and get around.”
It’s no coincidence that all these companies are eyeing Seattle as a launchpad for stationless bike share.
When Bluegogo tried to open in San Francisco it had to compete with a public bike-share system with 700 bikes (and plans to expand to 7,000). Austin, likewise, has a city-owned bike share system with 50 stations and 400 bikes.
Pronto’s demise made Seattle — with a famously outdoorsy culture — the third-largest American city (after Dallas and Jacksonville) without a bike share.
“We have a strong bike culture and a decent bike infrastructure,” O’Brien said. “We will get a disproportionate amount of their capital investment because they will all be trying really hard to outdo each other and prove they are the best system.”