A third player has entered the shared e-scooters sector: Israeli brand LEO, owned by e-scooter company Inokim, will enter the market in March, joining the two brands currently operating in Tel Aviv: US brand Bird and German brand Wind.
500 yellow e-scooters will appear in March in Tel Aviv, Ramat Gan, and Eilat. Deployment is scheduled to reach 3,000 dockless shared e-scooters in May in other cities, including Haifa, Givatayim, and Herzliya. Likes its competitors, the rent will be NIS 5 per trip plus NIS 0.50 per minute of riding. Renting and operations will be through a special app.
According to Kfir Benshooshan, one of the owners of the venture, 10,000 e-scooters will be deployed in Israel by the end of the year and 20,000 more in other countries, including Australia, Berlin and Munich in Germany, Malaga in Spain, Atlanta in the US, and Moscow and St. Petersburg in Russia.
Inokim is owned by Kfir and Dror Benshooshan and two other partners. Inokim, founded seven years ago, has sold 200,000 e-scooter units to date: 50,000 in Israel and the rest in the US, Europe, and the Far East. The company has raised $20 million to date from private investors. The idea of a shared e-scooter was born after international rental companies asked the owners to serve as their local representative. "From this, we got the idea to do it by ourselves and use Inokim as a manufacturer and service provider," Kfir Shushan says.
"We come from the e-scooter industry; that is our advantage over the competition," Kfir Benshooshan told "Globes." "We have laboratories for maintenance and handling; this is our expertise." LEO's shared e-scooters are an Inokim model developed specially for rental that will not be for sale. Inokim's retail e-scooters are priced at NIS 5,000-8,000.
The company is also considering renting out electric bicycles and compacts at the same price as e-scooters, a product that does not yet exist in the public space. Timing the launch for the Eurovision song contest, which will bring thousands of tourists to the city, is being considered. Benshooshan says that the bicycles will provide a solution for an older group that does not ride e-scooters. As part of its sales promotion, LEO will offer tourists free rides. It was previously reported that Castro Model Ltd. (TASE: CAST) would invest in Inokim for the sake of a joint venture, but the idea did not pan out.
LEO's economic model is different from that of Bird and Lime, another e-scooter company planning to penetrate Israel. These companies employ people to charge the e-scooters for NIS 30-70 per e-scooter. LEO's e-scooters are equipped with a removable battery. The company's vehicle fleet will patrol all day and night and replace the batteries. "In this way, we'll operate 24/7 and save 30-40% of turnover - what our competitors pay for their charging," Benshooshan says.
As with Wind and Bird, only those over 18 are allowed to rent e-scooters. A case will be installed on each e-scooter containing a branded helmet for use by the renter (including a disposable hat to wear beneath the helmet). What about theft of the helmet? "The hat will burn on the thief's head - the helmets will be branded, so anyone who steals one will advertise for us, and it will constitute a confession that the helmet is stolen," Benshooshan explains.
The e-scooter will also contain a place for a mobile phone (including for navigation). Through the app, the e-scooter can be reserved in advance, or use of it can be delayed for up to 15 minutes (for example, to stop for coffee). The company plans in the future to offer a program for accumulating points (like flight miles in civil aviation) that can be used at businesses.
Benshooshan is not deterred by the many competitors in the market. "Demand is much higher than supply, and we think it will increase. This is a supplementary transportation solution that more and more people are adopting. Today, the problem is finding an available or charged e-scooter for riding, especially near the railway stations, which are the places with the highest demand. Among the competition, it's hard to find an e-scooter fit to ride in the afternoon. There's room for more players."
"Globes": The authorities think that the sidewalks are becoming crowded. Not everyone will be patient with each other in the long term.
Benshooshan: "We're trying to form as many partnerships as we can with several mayors. The municipalities can also profit and realize that we're the solution, not the problem. In any case, we'll work strictly according to regulations, so we also reached agreements with 500 businesses, including 150 parking lots in Tel Aviv, that we can use as stations for renting if we can't leave them spread around the public space."
Doesn't renting detract from marketing e-scooters for sale?
"Since our competitors entered the market, our sales have grown by 30%. Awareness of e-scooters has only increased. Here, too, it's a win-win situation for us."
Published by Globes, Israel business news - en.globes.co.il - on January 28, 2019
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