Lime watching IPO market ‘very, very closely’ as operator reports record results
The CEO of e-scooter giant Lime has said the company is watching the IPO market “very, very closely” ahead of a potential listing next year or the year after.
Speaking to City PM Lime boss Wayne Ting said “what we want to see is tech IPOs happening and going successfully, and there’s great investor interest and they trade well.”
“I think that’s gonna create the stage that will allow Lime to go public, hopefully, sometime next year or the year after that.”
Ting’s comments come as the company posts a record financial performance for the first half of 2023.
An unprecedented 40m trips in the second quarter helped the e-scooter operator drive to $250m (£199m) in gross bookings, up 45 per cent on the same period in 2022.
Lime also reported an adjusted global EBITDA of $27m during this period, the first time it has reached that milestone in a first half set of results and with a margin improvement of 29 per cent.
Speculation has been mounting over a possible listing, with Ting’s intention for it to be “in the United States,” although a slowdown in the IPO market has delayed that goal and the operator’s chief said he remained “realistic about the marketplace.”
The micromobility giant became the first to hit profitability earlier this year, on an unadjusted basis, marking a rare exception in a sector whose finances have come under increasing scrutiny in recent years.
Ting told City PM “people have not figured out how to make money in this business. There’s plenty of dead bodies in the industry.”
He believes a key differentiator between the San Francisco-based firm and rivals such as Tier and Dott, is that it develops much of its hardware and technology “in house.”
“All of our competitors at this point, outsource their hardware R&D. They all admit they buy off the shelf from two Chinese manufacturers, either Ninebot or Okai.”
This, he explains, limits businesses differentiation. “Their business is sell you more scooters and sell you more spare parts. They have no incentive to make these things last very long, make them more sustainable to not consume a tonne of spare parts.”
After benefiting from a slew of venture capital interest in the early days, many e-scooter and e-bike businesses are now facing financial difficulty.
Tier is yet to turn a profit and has been through several rounds of layoffs, letting go of 180 people in August 2022 and another 100 in January.
Rival Bird, meanwhile, warned of a potential bankruptcy in November as cash reserves dwindled.
Ting though is bullish about Lime’s prospects, as it looks to become the outlier in what is a ruthless market.
“Lime has generated $27m of adjusted EBITDA year to date and I think we’re gonna do even better in the second half of this year, we are on track to be free cash flow positive, we have all the characteristics and I think it’s ready to tap the next source of funding, which is the public markets.”