‘We are still profitable. Quarter after quarter.’
Startups are the embodiment of frenetic action. The rush to grow, outrun, and disrupt runs in the lifeblood of today’s entrepreneurs, driving their fervor and enabling them to capture markets from giants of industries too big to maneuver in a quickly changing landscape.
That has been truer for the mobility landscape than most other industries. Companies like electric scooter providers Lime and Bird have raised tons of capital to change how the urban population gets around, but that growth has come at the cost of a bottom line still in the red.
So it’s striking to see electric scooter company Veo take a different approach to the business. Rather than raising venture capital and scaling quickly, the company does business the old-fashioned way: Proving the model works in one market before moving to the next. This slower, more methodical approach has worked in Veo’s favor — it might be the only company in its industry that has been consistently profitable.
Veo’s approach reflects its co-founder and CEO Candice Xie’s belief that transportation is not an industry that allows companies to scale rapidly and turn a big profit within a year, and especially not if it’s going to make sense for a city. Electric scooters aren’t just a business to Xie — they’re a utility, a tool that can be best implemented through patient collaboration between public and private partners. The CEO has taken this ethos and executed Veo’s business model with the expectation that it will make the company the most impactful in the industry.
A former financial planner for automation solutions company, Schneider Electric, in Chicago, Xie launched Vue in 2017, partly inspired by the bike-share boom in Asia. She was decidedly against the poor quality bikes many operators were deploying at the time, and was also frustrated by the lack of affordable, safe and convenient transportation in Chicago. After some market research, Xie and her co-founder, Yanke (Edwin) Tan, a bike engineer, discovered the gap in last-mile transportation in the United States.
The following interview, part of an ongoing series with founders who are building transportation companies, has been edited for length and clarity.
In your Medium post titled “Sorry, Boys. The First Profitable Micromobility Company Was Veo, Not Lime,” you fired some shots at Lime and the tech bro-ey micromobility industry at large. That was pretty bold.
Thank you! I think because of the VC money and also the hype in the industry, a lot of people just forget how easy and simple the business should be. That’s why I put out the post. It was just time to say something in the industry and help people to understand.
What made you write it?
That was actually the time when Lime announced they were the first ones to achieve profitability, and that’s through EBITDA, and a lot of people were clapping for them. I was compelled to write because many people who follow the industry asked me, “Hey, it seems their approach is working? Should we follow suit? Why are you taking a different approach?”
I felt like that statement from Lime was quite misleading for a lot of people, and I don’t think that was a responsible statement, either. So that made me feel like I should use my insight and just explain things a bit more openly with our information.