Tier Mobility-owned Spin lays off about 10% of workforce, exits two markets

Spin, which was acquired by Tier Mobility earlier this year, has laid off about 10% of its staff — including a number of executives — and is exiting Canada and Seattle, TechCrunch has learned.

The micromobility company informed its workforce of more than 700 during a Friday all-hands meeting that lower-than-expected demand in the U.S. amid the waning pandemic, along with economic conditions such as rising inflation and a tightening VC funding environment, led to the decision.

About 78 people, the majority of whom are white-collar workers based in its San Francisco headquarters, have been laid off. The affected employees were notified prior to the meeting.

Staff was also told that it is exiting Kelowna, British Columbia, and Seattle, where it was just invited to return as a bikeshare vendor for 2023. Seattle’s Department of Transportation told TechCrunch that Spin, which operated a scootershare in Seattle from 2021 to 2022, was not granted a permit to continue scooter operations in 2023; the DOT said it was working with Spin to confirm their plans in light of the recent announcement.

Spin had operations in Edmonton, Red Deer and St. Albert, Canada, but never reactivated those cities after winter ended this year. Kelowna was its last remaining Canadian market.

Philip Reinckens, a Tier veteran who took the CEO spot in May, delivered the news to employees, according to sources who asked not to be named.

During the 20-minute meeting, Reinckens told workers that the company’s priorities are to preserve cash and achieve profitability. Notably, he said the entire micromobility industry was suffering from a perfect storm of events that included supply chain constraints, inflation, the war in Ukraine and a tight labor market. While the company has cut costs such as downsizing its San Francisco office and rolled out programs to encourage more ridership and raise its bottom line, the company still wasn’t able to capture the demand needed to make profit and loss figures work, he said, according to an audio recording of the event shared with TechCrunch.

Lucas Beard, Spin’s VP of growth and marketing, also confirmed the layoffs and the decision to leave Canada.

“While it’s impossible for us to predict the future in such a new industry, what we can promise is that we’ll continue to be as transparent and thoughtful as possible as we continue to evaluate our financial performance and external market conditions,” Beard wrote in an email. He added that Spin is also centralizing some areas with parent company Tier.

The layoffs come about six months after Berlin-based micromobility operator Tier Mobility acquired Spin from automaker Ford. The acquisition marked Tier’s move into North America and came after an aggressive expansion in Europe that included buying e-scooter company Wind Mobility’s Italian subsidiary and bike-share startup Nextbike.

The Spin acquisition gave Tier a global footprint of more than 520 cities and communities in 21 countries. It also added to its costs and ultimately led Tier to restructure. In August, Tier laid off about 16% of its workforce, or 180 people, due to economic conditions and a tightening funding climate.

The VC firms once gladly forked over funds to shared micromobility startups even as costs piled up and questions loomed about whether shared scooters and e-bikes could ever be profitable enterprises.

In the past year, micromobility companies still reliant on external funding have found a less receptive VC community. Bird, Superpedestrian and Voi are a few that have laid off workers in 2022. The lack of demand in some markets — including ones that once were teeming with users before the COVID pandemic — has forced companies to restructure their businesses and seek ways to cut costs.

Clarification: This article has been been update to reflect the nature of Spin’s relationship with Seattle. The company was not granted a permit to continue its scootershare in the city in 2023, but was granted to operate a bikeshare.