Spin, which was acquired by Tier Mobility earlier this year, has laid off about 10% of its staff – including several executives – and is leaving Canada and Seattle, TechCrunch has reported.
The micromobility company informed its workforce of more than 700 people at an all-hands meeting on Friday that demand was lower than expected in the US amid the waning pandemic, coupled with economic conditions. economic factors such as rising inflation and a tightening VC funding environment, led to the decision.
About 78 people, most of them white-collar workers with headquarters in San Francisco, have been laid off. Affected employees were notified prior to the meeting.
Employees were also told they were leaving Kelowna, British Columbia and Seattle, which currently only sell e-bikes. Spin has operated in Edmonton, Red Deer and St. Albert, Canada, but never resumed operations in those cities after this winter ended. Kelowna is its last remaining Canadian market.
Philip Reinckens, a rank veteran who has taken the position of CEO in May, passed the news on to employees, according to unnamed sources.
During the 20-minute meeting, Reinckens told workers that the company’s priority was preserving cash and achieving profitability. Notably, he said the entire micro-mobile industry is suffering a perfect storm of events including supply chain constraints, inflation, war in Ukraine and the labor market. tightening action. Although the company has cut costs such as reducing the size of its office in San Francisco and rolling out programs to encourage more riders and improve profits, the company has still not been able to capture the need to gives profit and loss figures, he said, according to an audio recording of the event shared with TechCrunch.
Lucas Beard, Spin’s VP of marketing and growth, also confirmed the layoffs and the decision to leave Canada and Seattle.
“While we cannot predict the future in such a new industry, what we can promise is that we will continue to be as transparent and thoughtful as possible as we continue to evaluate performance. financial and external market conditions,” Beard wrote in an email. He added that Spin is also centralizing some areas with parent company Tier.
The layoffs come about six months after the Berlin-based micromobility operator The level of moves that get Spin from the automaker Ford. The acquisition marks Tier’s move into North America and comes after an aggressive expansion in Europe that includes buying e-scooter company Wind Mobility branch in Italy and Start bike sharing Nextbike.
The Spin acquisition gives Tier a global footprint of more than 520 cities and communities in 21 countries. It also adds costs and eventually causes Tier to restructure. In August, The layoff rank is about 16% its workforce, or 180 people, due to tight economic conditions and funding environment.
VC firms used to happily funnel money to startups sharing micro-mobility even as costs piled up and questions arose about whether shared scooters and e-bikes could be. whether the business is profitable or not.
Over the past year, micro firms that still depend on outside funding have found a less receptive VC community. Bird, Superpedestrian and Elephant are a few that have lay off workers in 2022. A lack of demand in some markets – including those that were packed with users before the COVID-19 pandemic – has forced companies to restructure their businesses and find ways to cut back. cost.