Spin — Riding Into The Future of Urban Transportation

We are happy to announce our investment in Spin, a company aiming to make the “last mile” of urban transportation easy, accessible and affordable by deploying a network of connected bicycles that can be picked up and parked anywhere. We welcomed the opportunity to lead Spin’s $8 million Series A round to help the company serve major markets around the country.

Spin is helping to solve one of the most important facets of “the last mile problem.” Public and on-demand transportation and logistics companies are very good at moving people and goods over long distances quickly and efficiently, but that final step from a transportation hub to one’s final destination has always been a challenge. Through its recently-announced Spin Cities Project, the company is collaborating with cities to fund urban transportation initiatives to make bikes a safer and more attractive solution to the last mile problem.

We’re looking forward to working with the Spin team to position the company as the leading provider of dockless bike transportation in the United States. Derrick Ko, Spin’s CEO previously was a product manager at Lyft with experience managing both rider and driver growth. The CTO was an engineering lead at Disqus where he built products for hundreds of millions of users. We’re impressed with the team’s execution to date and are confident in their ability to position Spin as the leading provider of dockless bikes in the US.

Why Spin?

On a Friday afternoon in downtown San Francisco, I was finished with a meeting and wanted to head back to Palo Alto for the evening. San Francisco’s financial district is very dense, with a lot of narrow streets and on any ordinary afternoon, it’s packed with cars full of people who just want to get home and start the weekend. That day, though, was particularly bad. Cars weren’t moving at all. Many of the cars had stickers and signs from Uber and Lyft, and most of those were empty except for the driver. Unable to get anywhere in traffic like that, I had to walk almost half an hour to somewhere I could get a car.

It may sound strange, but that frustrating experience stuck with me. What these services managed to accomplish in such a short period of time is extraordinary, but at the end of the day, cars are still the primary source of congestion and pollution in American cities. There are better options out there for making short trips.

Bikes prove to be the best solution for reducing traffic, and with new technology, it’s finally possible to have a truly seamless riding experience in a city. Many American cities have recently invested considerable resources in making themselves more bike-friendly, and for a good reason.

Here are some statistics that stood out to us:

• 48 percent of Americans lack access to functioning bicycles
• 53 percent of Americans say they would bike for work and pleasure more frequently
• More than $1 billion is being spent on bike-friendly infrastructure around the US
• Cars are used for 75 percent of trips under one mile

According to data compiled by Statista Inc., bike ridership in the US has grown significantly over the past five years.

In the eight years between spring 2008 and spring 2016, the number of Americans who have ridden a bike in the last twelve months has grown by over forty percent. It’s estimated that Americans purchase roughly twice as many bikes than passenger cars every year. And although annual car sales are declining in the US, overall bike sales have remained more or less steady.

Around the US, more people are using bikes for short trips now than they ever have before. On average, between one and two percent of Americans use bikes as their primary way of getting to and from work, but in some particularly bike-friendly cities, that proportion is much higher. Below, we’ve included a chart depicting the percentage of bike commuters in the highest-ranked cities in America, based on findings from the US Census Bureau’s 2014 American Community Survey.

What do these cities have in common? Most are relatively compact, and many of them are college towns where students and faculty ride to and from campus by bike. But, more importantly, these cities have invested in bike-friendly infrastructure like public bike racks, designated bike lanes, and traffic laws designed to protect cyclists.

Of course, in most of these cities, people have their own bikes, but for the first time ever it’s possible to deploy a decentralized network of bikes for everyone to use at a price just about everyone can afford. Spin aims to do just that.

For Urban Bikes, The Future Is Dockless

Over the last decade, cities have been transformed by a new generation of transportation services. Wireless connectivity, GPS tracking, and integrated payments in mobile apps have made getting from point A to point B as easy as tapping a couple of buttons on your phone. But up until this point in the US, most of the attention has been directed at how these disruptive technologies are driving radical change in the automotive side of the transportation services market.

Spin sets out to apply a similar user experience people enjoy with car-hailing services to bikes. By deploying a network of bikes that people can access anywhere, without needing to pick up or drop off shared bikes at specified kiosks, Spin riders have the freedom to move about an urban environment

For consumers, public transportation and automotive infrastructure is quite effective at getting passengers from one general area to another general area, but unless you live or work within a couple minutes’ walk from a bus stop or a subway station, there’s a real cost of time and physical energy imposed by traveling more than a few blocks on foot. Taxis and ride-hailing services cost more in both money and time, especially in heavy urban traffic, than bikes.

Bicycles offer cities the opportunity to reduce some of the serious economic and environmental costs of cars. The first generation of urban bike-sharing infrastructure has been rather successful. Kiosks or docks with bikes available for short-term rental first achieved serious scale in Beijing prior to the Olympics in 2008. This model, which allows riders to check out bikes from one kiosk and return them at any other kiosk in the city, has taken off around the world. Most urban centers — including London, Paris, Beijing, Shanghai, New York, San Francisco, Chicago, and dozens of others — now have some sort of dock-based bike sharing operation.

But the way bike transportation services have been implemented in the US still suffers the same drawbacks as other public transportation options. Just like there’s a time cost imposed by walking from public transportation to a final destination, there’s a time cost imposed by walking from bike kiosks to a final destination. It’s simply impractical to put an expensive bike station on every corner. A dockless bike service provider like Spin gives cities the opportunity to be more bike-friendly without the capital expenditure of installing and maintaining bike stations.

At Grishin Robotics, we’ve invested in several companies that aim to solve the problem of transporting goods “the last mile” to their final destination. With our previous investments in Starship Technologies and Zipline, we were looking for opportunities to improve the way that goods are delivered to their final destination. We are excited to partner with Spin, a last-mile transportation solution for people. Together, it’s our goal to improve the way people get around in cities. It’s likely that the future of urban transportation will roll in on two wheels, not four.