Mobility startups valued at a whole bunch of billions of gained may face challenges in going public, as a proposed invoice seeks to fully ban electrical scooters — the core of their shared transportation enterprise, business officers stated Thursday.
The invoice, proposed by Rep. Kim So-hee of the principle opposition Individuals Energy Get together (PPP), goals to take away electrical scooters from the legally acknowledged listing of private mobility units and prohibit their operation completely.
The proposal, submitted on Oct. 31, comes amid a surge in accidents involving electrical scooters.
In keeping with knowledge from the Korea Street Site visitors Authority, the variety of such accidents elevated greater than 20-fold in six years — from 117 instances in 2017 to over 2,300 in 2023 — leading to 24 deaths and round 2,600 accidents.
Notably, 34 % of the accidents concerned unlicensed drivers, and amongst these instances, 67 % of the offenders have been beneath the age of 20, prompting requires stricter security laws.
Nevertheless, business officers warn that the ban may jeopardize mobility startups’ plans for preliminary public choices (IPOs), which assume the continued use and progress of electrical scooters within the shared transportation sector.
Amongst these corporations are The Swing, G-Bike, Beam Mobility Korea and PUMP, which have acquired a whole bunch of tens of millions to over a billion gained in investments from main firms and monetary corporations. All are unlisted corporations, valued at 200 to 300 billion gained, and are pursuing public listings.
The Swing, which operates the shared scooter service “SWING,” acquired funding from first-generation enterprise firm Humax in addition to enterprise capital corporations together with Hashed Ventures and SJ Companions.
G-Bike, operator of the electrical scooter “GCOO,” secured funding from Hyundai Motor, Mirae Asset Enterprise Funding, Yuanta Funding, Eugene Asset Administration and BNK Enterprise Funding. PUMP, which operates “SING SING,” additionally attracted investments from SK Inc., KB Funding and Shinhan Capital.
These investments have been pushed by the startups’ perceived progress potential. Shared scooters are thought-about an answer for the “final mile” of transportation — bridging the hole from subway stations or bus stops to the ultimate vacation spot.
“If the regulation passes, these startups will wrestle to fulfill IPO necessities,” an business official stated, noting that corporations would discover it troublesome to attain extremely on company continuity and enterprise viability.
He added, “If operations are halted because of the regulation, not solely potential IPO corporations but additionally already listed corporations would want to bear separate, substantial itemizing opinions.”
One other business official famous that whereas security is necessary, an outright ban may stifle innovation and severely impression the expansion of shared transportation startups.
“The controversy highlights the problem of balancing public security with the event of latest city mobility options,” he stated.
