Bird is laying off about 30 percent of its staff in response to the financial uncertainty of the coronavirus pandemic. The layoffs, which were first reported by TechCrunch, are the first major staff cuts by a scooter startup since the pandemic first hit — but they are likely not to be the last.
The news comes after most of the major scooter sharing startups have said they would reduce or eliminate service in most major markets in response to the coronavirus pandemic. According to a memo from Bird CEO Travis VanderZanden published by TechCrunch, the layoffs were needed to ensure the company stays solvent until the end of 2021.
the layoffs were needed to ensure Bird stays solvent until the end of 2021
Laid off employees will be provided four weeks of pay, three months of health coverage, and an extra 12 months to exercise their stock options, TechCrunch reports.
With “shelter-in-place” orders, social distancing, and most people simply staying at home and avoiding unnecessary travel, scooter companies are seeing a steep drop in sales and demand. The timing of the pandemic is also posing a unique challenge for the money-losing scooter industry that sees its business slow down in the winter and pick back up again when the weather turns warm.
The pandemic notwithstanding, no startup has yet figured out how to earn a profit without relying on tens of millions of dollars in venture capital investment.
Bird’s main rival, Lime, is likely also considering worker reductions. The San Francisco-based company laid off 14 percent of its workforce last January and exited 12 markets, and a recent report in Bloomberg suggested that Lime is close to eliminating up to 70 more positions in response to the coronavirus. Another scooter startup, Wheels, recently laid off 6 percent of its employees.