Plummeted by 99%!14 billion was wiped out, and this scooter unicorn went bankrupt

In the past two years, with the Federal Reserve's successive interest rate hikes.

Many innovative companies in the United States have encountered difficulties at the funding level, following wework, the former entrepreneurial star, the star sharing electric scooter unicorn company Bird, recently officially filed for bankruptcy protection in Florida.

According to the data, Bird was founded in 2017 by a former Uber executive, and after founding the company, it won the favor of Silicon Valley tycoons such as Sequoia Capital and Accel Partners.

With the support of capital, the company once became the fastest start-up with a valuation of more than $1 billion.

In fact, as one of the world's outlets, the sharing economy quickly swept the world, and gave birth to a number of unicorn companies, such as Uber and wework.

Analyzing these enterprises, we will find that with the continuous influx of capital, quickly "subsidize" users, solve some user pain points, and then quickly accumulate users, and finally complete the closed loop.

But one of the huge drawbacks of these sharing enterprises is that they are very dependent on capital.

After the interest rate hike cycle, as the cost of capital becomes higher and higher, the ability of these shared enterprises to raise funds becomes worse and worse, and the "bubble squeeze" begins.

Among them, the company that suffered the most "losses" was SoftBank, because SoftBank is not only the majority shareholder of Uber, but also the majority shareholder of WeWork.

WeWork alone, SoftBank lost billions of dollars.

Faucets are like that, and Bird is no exception.

According to the data, at the beginning of 2018, Bird received 15 million yuan in Series A financing, and the company's valuation exceeded 300 million US dollars. What's even more exaggerated is that in May 2018, Sequoia Capital's 150 million investment quickly pushed the company's valuation to a high of $1 billion.

But Sequoia Capital didn't stop there, and just a month later, it invested another $300 million in Bird. At this point, Bird is valued at more than $2 billion.

In November 2021, Bird was listed on the New York Stock Exchange.

After listing, Bird's market capitalization soon exceeded US$2 billion (about 14.3 billion yuan). But the good times were short-lived, and the company's stock price began to plummet after several months of sideways.

An investment institution once calculated that the cost of each shared scooter of the company is 551 US dollars, and the service life of the shared scooter is only 6 months, so the company needs to use it frequently to ensure return on investment and profitability, but obviously, it is very difficult.

This model has also proven to be a rather bad business model. As the scooter boom subsided, the company's losses widened, and more tragically, the New York Stock Exchange began the delisting process in September this year.

On December 20, local time, the company announced that it had filed for bankruptcy protection.

After the announcement, Bird's stock price plummeted nearly 80% in a single day. It is understood that Bird's existing creditors will provide $25 million in DIP financing. According to the announcement, the company will continue to operate normally during the bankruptcy proceedings.

Bird's management also said there were still big questions about the company's ability to continue as a going concern after closing operations in dozens of cities, reorganizing its management team and renegotiating its debt payments to cut costs.

It is reported that the company currently operates in 350 cities around the world, but a Bird spokesperson declined to disclose the specific number of operating cities.

As of the latest close, the company's total market capitalization is less than $1 million, and its stock price is only $0.059 per share, a decline of more than 99%.

Kanjian Finance believes that the bubble bursting of the sharing economy model is actually due to the defects in the business model itself, which is essentially flow thinking, but with the ebb of the sharing economy, the disadvantages of this business model have begun to be exposed.

Of course, the iron must also be hard, compared with the bankruptcy of companies such as wework, Uber's business model has been recognized by the market. At present, the company's stock price has almost hit a new high, and the market value has reached $126.99 billion, and the core behind it is that Uber has made a profit, and its revenue is also rising steadily.