Lime Evaluates Timing for Potential Public Offering
Lime, the global startup known for its shared e-scooters and e-bikes available in 280 cities worldwide, has long contemplated the idea of going public. Now, Lime's CEO, Wayne Ting, believes that the time is ripe for this aspiration to become a reality.
The public markets have experienced a prolonged period of stagnation, driven by factors like rising inflation, increasing interest rates, and geopolitical tensions. However, a recent market upswing has rekindled interest in new stock listings, with numerous initial public offerings (IPOs) anticipated in the near future. Combined with Lime's reported growth and profitability, these market dynamics have instilled confidence within the company, making them seriously consider their public debut.
Ting expressed optimism, stating, "If the market reacts well, and as more companies come out [with IPOs], we have the economics, the growth, the profitability to take Lime public hopefully as soon as the market permits."
On a recent Tuesday, Lime once again emphasized its profitability, a rarity in an industry struggling to achieve positive unit economics. While withholding specific financial metrics that would provide a holistic view of the company's financial health, Lime did reveal that it achieved adjusted EBITDA profitability of $27 million for the first half of 2023. On an unadjusted basis, this figure stands at approximately $20.6 million.
Although Lime did not disclose its revenue, the company did share that it generated $250 million in gross bookings, representing a 45% increase compared to the same period in 2022. Gross bookings signify the total value of customer bookings before expenses, indicating a robust demand for Lime's services, even though they do not reveal net income after deducting direct operational costs.
Lime refrained from divulging its operating expenses but did report a 29% margin improvement compared to H1 2022. Ting attributed this enhancement to the longer lifespan of their latest generation of scooters and bikes, resulting in reduced maintenance capital expenditures. Additionally, Lime has been investing significantly in growth, with a surge in demand this year that surpasses previous years for the entire industry.
Lime's growth appears impressive, considering their last disclosed financials in February, which showed adjusted EBITDA of $15 million and unadjusted EBITDA of $4 million for the entire year of 2022. This means that Lime's earnings in the first half of 2023 surpass those of the entire previous year.
Apart from improved margins, Lime attributes its increased profitability to having 20% more vehicles on the streets and a 16% increase in trips per vehicle per day, although specific numbers were not shared. Nonetheless, Lime disclosed that it recorded over 40 million trips worldwide in the second quarter alone.
Lime has gained a reputation for succeeding where other companies have faltered, boasting a 90% success rate in securing permits to operate in cities. According to Ting, winning Requests for Proposals (RFPs) is crucial for growth, and Lime's extensive operational experience has been instrumental in winning over city governments.
Additionally, Lime's technology sets it apart, as it has developed its hardware in-house for years, claiming to produce vehicles that are safer, more durable, and environmentally sustainable. Ting noted that riders appreciate these qualities, and when Lime introduces new generations of scooters and e-bikes, they observe an increase in utilization, demonstrating that riders actively choose Lime over competitors.
In a market where many scooter companies rely on outsourced vehicle production, Lime's commitment to designing and building its vehicles has set it apart as a unique and successful player.