Source: Zag Daily

The shared mobility landscape is evolving, and operators’ strategies differ in regard to their business models. Some favour a vertically integrated business, with proprietary assets including hardware, software, and an operational model, while others prefer to outsource to specialist partners. Zag Daily and Urban Sharing hosted a Build vs Buy debate during Micromobility Europe to explore the topic.

The panel featured representatives of three companies in the shared mobility operating sector. Forest COO Will Jansen, represented a vertically integrated approach, with proprietary backend technology and an adtech ecosystem, alongside close hardware partnership. Christoffer Bakken Åkre is Senior Urban Planner at Bauer Media Outdoor, which operates shared bike systems as part of a larger infrastructure and advertising ecosystem, and works with best-in-class partners. Timo Buetefisch, Founder and CEO of Cooltra, represented a position between the two, with some capabilities owned by the company, and others outsourced.

Benefits of a hybrid approach

A consensus emerged that the most successful operators in the sector are currently practising or moving towards a hybrid strategy. Buetefisch emphasised that individual factors of geography, scale and business segment should inform decisions about ownership, pointing to his company’s strengths: “For us, we develop everything around customer retention, loyalty, bonus systems and dynamic pricing in-house because we think that’s where innovation matters.” Other concerns such as specific software are outsourced to expert providers.

Jansen acknowledged that total vertical integration is not often a realistic scenario, stating, “If you need to scale quickly into new countries and cities, there will always be requirements you haven’t built for yet. Hybrid is probably the winner in that respect.”

Bakken Åkre spoke from a point of view of a company which largely relies on external suppliers, highlighting that success depends on careful selection of collaborative partners.

Advantage of bespoke software

Jansen highlighted the key benefits of having developed proprietary customer-facing technology and operational tools, stating that, “there are key areas where it’s really important to retain control, particularly where the customer feels the impact.” This avoids the potential limitations of off-the-shelf platforms which are designed to serve multiple mobility sectors at the same time.

The viewpoint of cities

The panel agreed that cities generally are less interested in the operator’s business model, and instead are focused on the quality of service they can deliver. Cities’ key concerns are stability, safety, reliability, operational performance, and long-term sustainability. Buetefisch highlighted a changing perception, where cities are starting to view micromobility as a mode of transport to integrate with existing networks. “I think city councils have understood that micromobility is really a public transport category. I see a real shift there.”

Diversification for stability

The discussion addressed the suitability of different business models during market downturns, with the panellists advising the spreading of risk in various ways.

Bakken Åkre views bike sharing as part of the company’s broader infrastructure business, which includes generating revenue through advertising contracts and other public infrastructure projects.

Buetefisch described how Cooltra operates across a mix of consumer sharing, fleet management, and public bike share contracts, providing something of a buffer zone during fluctuations. “When Covid hit, our free-floating business was totally down but delivery and e-commerce went up a lot.”

Jansen emphasised that business resilience can come from choosing which assets not to own, pointing to Forest’s outsourcing of most of its operational workforce through trusted partners, enabling more efficient management of staffing levels. “If you’ve got everything in-house, you’re loading yourself up with fixed costs that you can’t easily scale down with demand.”