The First Mover Advantage in Micro Mobility: A Cautionary Tale of Moving Too Fast

In the rapidly evolving micro mobility industry, where shared electric scooters and bikes promised to revolutionize urban transportation, the concept of the “first mover advantage” has often been hailed as the ultimate strategy. The thinking goes: if you enter the market first, expand rapidly, and dominate before competitors catch up, you secure a permanent lead. This belief led many startups to aggressively raise capital, expand fast, and burn cash at unprecedented rates. Companies like BIRD, Lime, and others sought to flood cities with electric scooters and bikes, believing that speed and scale would secure their dominance.

However, a few years down the road, it is becoming increasingly clear that this strategy may not be as advantageous in micro mobility as it has been in other sectors. Companies like Bird, which raised hundreds of millions of dollars to scale quickly, are now facing significant financial troubles, with Bird having teetered on the edge of bankruptcy. Even with early successes in terms of market penetration and hefty cash outs by founders and investors through secondary share sales, many of these early movers are now either struggling to survive or have disappeared altogether.

The Burnout of the “Move Fast” Strategy

Take Bird as a prime example. Founded in 2017, Bird quickly became one of the fastest-growing startups in history. It expanded aggressively across cities in the U.S. and internationally, raising over $700 million within its first year. The promise was simple: flood the streets with electric scooters, capture the market, and outpace the competition.

But by 2023, Bird found itself facing severe financial problems, losing hundreds of millions annually, and its stock price fell dramatically. This trajectory from massive expansion to near collapse highlights the dangers of the “move fast and burn cash” approach. Though the company made early headlines and caught the attention of venture capitalists, the rush to scale left little room for sustainable growth, operational efficiency, or profitable unit economics.

Learning from Others: The Benefits of Moving Slowly

Contrast this with companies that took a more measured approach to growth. Instead of raising large sums of money to expand rapidly, some startups chose to focus on learning from the mistakes of their fast-moving peers. They carefully studied market dynamics, regulatory landscapes, and operational challenges before making large-scale investments. This slower, more deliberate approach allowed them to optimize their business models, avoid costly regulatory setbacks, and conserve cash.

In our industry, the key to long-term success seems to hinge on two major factors: sustainability and adaptability. The companies that prioritized gradual learning, adaptation to city-specific regulations, and efficient operations tend to still be around, even if they didn’t initially grab the headlines. These companies understand that micro mobility isn’t just about being first—it’s about being profitable and sustainable in a highly complex environment that includes urban infrastructure, unpredictable consumer behavior, and ever-evolving government regulations.

A Temporary Win for Founders and Early Investors

It’s important to note that the early movers, especially the founders and initial investors, often come out ahead in the short term, despite their companies’ long-term struggles. Through secondary sales of their shares, many were able to cash out when the hype around micro mobility was at its peak, regardless of whether the company ultimately succeeded. This allowed them to profit, while the companies they founded struggled to survive after burning through vast sums of capital.

But while these early financial wins might look attractive to entrepreneurs looking to build wealth quickly, they don’t represent a sustainable path for the micro mobility industry as a whole. The fact that many of these companies collapsed or are close to bankruptcy within just a few years shows that moving fast and burning cash doesn’t guarantee lasting success.

Lessons for the Future

As more companies enter the micro mobility space, the failures of early movers like Bird should serve as a cautionary tale. Success in our industry will be defined not by how fast you can deploy scooters and bikes on city streets, but by how well you can adapt, optimize, and operate in a sustainable manner. In this industry, the tortoise, not the hare, may very well win the race.

Moving slowly, learning from others’ mistakes, and figuring things out before scaling can lead to better long-term results. Instead of focusing solely on raising massive amounts of capital and expanding quickly, companies that take the time to refine their models, respect regulatory environments, and ensure profitability have a much better chance of surviving—and thriving—in the long run.

After all, in micro mobility, it’s not about who moves first; it’s about who moves smart. Now let’s #SMOVE 🙂