Some companies never learn, and that has led to one grueling week for Bird. They were kicked out of San Francisco and Santa Cruz, California. All because of their mistaken belief that it is better to ask for forgiveness than permission.
Bird -- Clipped Wings in San Francisco
Bird, the rental dockless electric scooter company, has been told to fly the coop, at least temporarily, by many cities across the country, including Nashville, Denver, and Cambridge, Massachusetts. Perhaps at the time, Bird wasn't too concerned, believing they would have another chance to the petition the city with a better, permanent plan. However, San Francisco was one of the first cities to complete this petition process, and Bird came out with its wings clipped, after the city chose to go with two smaller, more city-friendly companies, Skip and Scoot.
Cities Looking for a Partner, Not a Headache
Back in April 2018, San Francisco officials banned all scooters from the city, as it struggled to find a solution to the onslaught of scooters that seemingly appeared overnight. Bird had used its usual business model of dropping scooters onto city streets without permission, which irritated unprepared city officials and angered residents. San Francisco, in particular, received nearly 1,900 complaints in the first six weeks the scooters were dropped.
The San Francisco Municipal Transit Agency (SFMTA) said, "Complaints ranged from scooters blocking sidewalk access to unsafe riding in the public right-of-way. San Francisco Public Works had to impound more than 500 scooters that were blocking sidewalks or otherwise improperly parked." In the end, SFMTA decided to choose Scoot and Skip, two fledgling electric scooter companies, over the big dogs of Bird and Lime because they believed the smaller companies' applications demonstrated not only a "commitment to meet the terms of the permit, but a high level of capability to operate a safe, equitable and accountable scooter share service."
Bird as Welcomed as Seagulls in This Beach Town
In Santa Cruz, Bird droppings, er, scooters, arrived all over town with no prior announcement to city officials. In response, an annoyed city council issued Bird a cease and desist order, giving Bird until midnight that very same day to remove all scooters from city streets.
According to city officials, Bird didn't ask for permission or licenses, city officials to get proper permissions and licenses, establish a public policy, or to create a framework that ensures proper safety and access measures prior to establishing operations in Santa Cruz," according to the statement. Putting it very succinctly, city officials noted that "Santa Cruz is a small town where businesses know each other and work together. Bird's approach is dismissive of the hundreds of businesses in Santa Cruz who play by the rules, receive proper permits and licenses, and operate legally."
Scooter Market Has Big Valuations
Bird did win a battle in Santa Monica, the city in which it is based. That town issued permits to four companies to offer 750 scooters or electric bikes each: Bird, Lime, Lyft, and Uber-owned Jump. Word on the street had been that Bird and Lime would be shut out, but an eleventh hour change gave them a seat at the table. With a company valuation over $2 billion, Bird does have a viable future, and it does have the potential to solve pollution and traffic congestion, especially helping commuters with last-mile distances from transit stations to final destinations. It just need to learn how to play better in the City Hall sandbox.
San Francisco's decision serves as a key signal to small business that there are big contracts to be won for those companies willing to listen and be compassionately flexible. If you are considering creating a small business in this market, contact a local business attorney or government contracts attorney, who can help you with any legal troubles you may, or may not, be contemplating. Having a legally tight plan will make presentations to local government officials take flight.