Tier Mobility and Voi Technology, two European scooter startups, are reportedly in initial talks to merge, as competition in the scooter market increases.
Bloomberg, citing people familiar with the discussions, reported that the early stage merger talks were prompted by the impact both scooter companies are facing from bigger competitors from the U.S. entering the market. Discussions reportedly started in November, stalled after Voi decided it would rather stay independent. Talks could continue, the news outlet noted.
In an email to Bloomberg, Voi Chief Executive Fredrik Hjelm said that “other local players” have expressed interest in merging with the company. He declined to provide further details. Meanwhile, Tier Co-Founder and Managing Director Lawrence Leuschner said the company is moving ahead with its standalone expansion but noted that “there will be consolidation” in the industry.
News of the deal talks comes as the competition in Europe heats up among the scooter startups. Voi, Tier and Wind Mobility all launched within a few weeks of each other during the summer and they are just three of the several players vying to give rides to Europeans. On top of the local competition, Lime and Bird Rides, the two U.S. players, have also expanded into Europe, making a crowded marketplace even more competitive. Lime and Bird have raised hundreds of millions of dollars from venture capitalists which they are using in part to fund expansion throughout Europe. Bloomberg noted that both firms are aiming to raise more money to fund that expansion. Voi raised $50 million and Tier $30 million, a tiny portion of the amount the two U.S. players are bringing in.
With competition fierce in Europe’s scooter market, some of the startups see mergers as the way the industry is heading. There is not only a battle for customers but also a fight for top tech talent. That is also driving merger conversations, noted the report.