But shared mobility has run up against limits that even vast demand and venture capital couldn’t overcome. While hundreds of millions of people have tried a shared e-scooter or similar vehicle, most have ridden just a few times. Each vehicle is used, on average, about twice a day.

Shared electric vehicles are only available in the busiest parts of cities, and the work of keeping them charged and maintained means one short ride usually costs more than $5. With those limitations, shared electric vehicles function more like taxis than like mass transit. They are used regularly by affluent residents, occasionally by other locals who are in a hurry or having fun, and by tourists. While those activities are important, and every city should have shared vehicles available to residents and visitors, shared mobility’s contribution to urban mobility is, and will remain, small.

But that’s okay. 99% of e-bikes and e-scooters are owned by their rider, not shared. 

Roughly 300 million of these vehicles are currently in use, mostly by commuters in China. China’s early bans on combustion motorbikes, tremendous investments in road infrastructure, and ballooning urban populations created the perfect opportunity for e-bikes to take off.

But even outside China, e-bike and scooter sales are doubling year after year, and far outselling electric cars. In the US and Europe, buyers are coming from across the economic spectrum, from affluent urban parents looking for a school drop-off vehicle, to recent immigrant delivery workers just trying to get by. They are coming from all neighborhoods of a city, including areas not frequented by tourists or served by shared vehicles or mass transit. These owners aren’t just riding a few times. They are riding hourly, daily or weekly. As bike infrastructure improves, they and their neighbors will feel safer and ride even more. 

But to see the big opportunity, you have to take another step back, and look at the whole world: Most people do not yet own a motorized vehicle of any kind. This is not by choice. It’s because they can’t afford one. We are talking about 3 billion un-motorized people vs. the roughly 2 billion who own a car, motorcycle, or e-bike. To be clear: Those 3 billion people are not waiting for a $5/ride shared e-scooter to appear in their city. They want their own vehicle, and they want it ASAP. 

Electric bikes are the most affordable motor vehicles in the world today, starting as low as a few hundred dollars for a Lead acid-powered e-moped or Lithium ion-powered stand-on scooter. They will only get more affordable as production - and especially batteries - continue to improve. Prior to e-bikes, most people’s first vehicle was a combustion motorbike because those were the most affordable motorized vehicles. For the billions of people who aren’t yet able to afford even a combustion motorbike, and whose alternative may be taking a crowded bus that’s stuck in traffic, a moto taxi, or walking, e-bikes and similar vehicles are compelling.

But to unlock that demand from the majority of adults, you need financing, and that is where the nearly unlimited market for owned electric mobility will be unlocked by this past decade of shared electric mobility: 

Roughly 1 billion times, a shared electric mobility company like Tier, Hello, Bird, or Yulu has allowed someone to borrow a valuable e-scooter, bike, or moped without checking their credit, demanding a huge security deposit, or otherwise underwriting the loan of the vehicle in any conventional way. The reason is that these vehicles are connected, tracked, and remotely managed such that if one is stolen, or simply not paid for, it can be deactivated, located, recovered, and returned to revenue use that same day.

Sharing rentals were really very short term, uncollateralized loans of very useful assets. There are billions of people who would love to be the borrower of one of those vehicles, especially if the lender, by virtue of their remote vehicle management technology, is as unconcerned about their credit as they were about the credit of the last billion riders. 

When someone owns an e-bike or similar vehicle, or finances it or leases it to use every day, they are not paying someone else to charge it, like they would a shared vehicle. They are charging it themselves at home. And they are not paying someone else to look after it when they park it, like they would a shared vehicle. They are either bringing it inside, or they are locking it up to protect it. The cost to the owner is not $5/ride. It’s just the wear and tear on the vehicle, a wireless data connection for security, and a trickle of electricity for charging. It adds up to less than $1/day. 

At $1/day, nearly anyone could have their own e-bike, and there is no reason why they shouldn’t. While another billion cars (the expected increase over the coming decade or so) will doom our climate and clog our cities, another billion or so e-bikes will do the opposite.

Ten years ago we began a somewhat chaotic, generally unprofitable, and incredibly popular experiment in shared electric mobility. These next ten years will see a relatively predictable, highly profitable, and globally inclusive expansion of these wonderful vehicles and their enabling technologies. The mass adoption of e-bikes and similar vehicles will head-off catastrophic demand for combustion vehicles, make at least 1 billion people’s lives more independent and free, and make the chaos of shared mobility totally worth it.

In web3, a resource controlled by software can be an asset, with all the composability that implies. 

As participants in web3 build bridges to the “real world” and look for real world assets to finance, tokenize, and otherwise bring on-chain, assets that can be controlled by software will be the first to cross over. 

Electric vehicles will be among the biggest of these new asset classes. They meet a set of criteria that few other assets do:

• Natively controlled by software

• A new asset class

• Rapidly growing to trillion dollar-scale

Electric vehicles are natively controlled by software: If the software in the vehicle says “don’t go”, the vehicle doesn’t go. This is more true of an EV than even a modern, electronics-laden combustion vehicle, whose software dependencies are more superficial. If the vehicle is owned or otherwise financed on-chain, and the financing or use payment hasn’t been made to the contract that controls the vehicle, the vehicle can be disabled until payment is made. 

The most familiar web2 example of this are shared scooters which won’t go unless they get a software command that activates them, which of course only comes if someone pays for the ride using the app. This type of transaction has happened billions of times around the world over the last decade that shared scooters and bikes have been in service. See Bird, Tier, Hellobike, and my former company, Scoot, which was the first to deploy this model.

Another example is from the pay-as-you-go (PAYGo) financing industry. Millions of solar home systems, smartphones, and other essential electronics have been sold to people in parts of the world where savings and access to credit are both very low. These sales allow the buyer to make incremental payments (often weekly) in order to continue to use, and eventually own, the device. If the payments aren’t made, the device doesn’t function, so repayment rates are high. See M-KOPA, PayJoy, and Angaza.

While an electric vehicle, especially a regulated vehicle like a car or truck, needs a legal owner, that could be a simple LLC, and the utility of that vehicle is still subject to software. 

Electric vehicles are a new asset class. Large, proven markets inevitably have established competitors and often have regulations that are designed to or inadvertently protect incumbents, making it harder for new products to compete. Continuous mass production of electric cars began a bit over a decade ago, and only ~1% of cars and trucks in the world are electric. Electric bike/moped mass production began about a decade earlier, but was almost all in China, and only ~30% of two wheelers today are electric. How these new types of vehicles will be financed is an open question that web3 can answer.

Electric vehicles are rapidly growing to trillion dollar-scale. There are already $1.4T in auto loans in the US alone, and many of those as well as many in Europe and elsewhere will become electric vehicle loans. But the big prize is among the billions of people who have never been able to afford their own vehicle of any kind, but will be able to afford electric vehicles, especially two-wheelers (currently 90% of EVs in the world), if offered financing. This transition and growth creates opportunities for new players and new models that incumbents, even if they adapt, won’t be able to capture all of. 

I glossed over a non-trivial technical challenge of linking a software-controlled vehicle to a software contract, especially in a trust-minimized or decentralized way, but this is already happening in various forms. See Helium’s wireless networks, IoTeX and IOTA’s IoT-specific protocols, DIMO’s and WeatherXM’s data gathering protocols, and Celo’s use of ultra light clients on mobile devices. 

Electric vehicles aren’t the only asset type that meet the above criteria, they are just the biggest. Web3 welcomes creativity (and craziness) so we should expect all kinds of assets to be financed, or attempted to be financed, with some form of web3 technology or business model. 

But I will name one important and often cited real world asset type that does not meet the above criteria: Real estate.

X Buildings can’t be meaningfully controlled by software. Bringing them on-chain requires tokenizing an LLC, making an NFT out of the title and a ream of other documents, or similar flimsy mechanics. Putting a smart lock on the door only partly controls the utility, with all due respect to Slock.it, the original project in this space. 

X Real estate finance is a decades-old industry that is highly competitive, heavily subsidized and regulated - exactly the kind of industry you don’t want to compete with head-on.

? Real estate finance is already a multi-trillion dollar asset class in the US alone, with little room to grow, though it may be growing quickly in the global south as those countries’ credit environments mature.

There is so much to look forward to in the coming chapters of web3. Infrastructure improvements. More participants (especially in the global south). Better UX. Alongside these, incorporating real-world value into DeFi will make the ecosystem healthier, more stable, and more credible. Digitally-controlled real world assets like electric vehicles will be a big part of that. You will probably park at least one in your wallet. 

There Are 300 Million Electric Bikes and only 10 Million Electric Cars (2021) - Because we are building the wrong kind of electric car.

How to Cut Ride Hailing Use by 50% (2019) - Proof that shared, electric motorscooters are the perfect substitute for traffic-inducing and dangerous ride hailing services.

San Francisco’s Huge Parking Opportunity (2019 with Laurence Wilse-Samson) - We show how much space SF wastes on car parking and what you could do with it.

Micromobility Doesn’t Have to be Disposable (2019) - After adding locks to our stand-on scooters, they stop getting stolen and trashed, a revelation to the industry.

New Delhi Will Leapfrog New York in Mobility (2018) - After visiting Delhi for Scoot, realizing that the future of e-mobility is in the global south.

What we learned from our first month of operating Scoot Kicks (2018) - After winning the San Francisco scooter permit, we reveal just how many scooters are getting stolen.

Shared Electric Vehicles are the Subways of the 21st Century (2018) - On Network Age transportation systems vs. Industrial Revolution transportation systems.

Shared Scooters, From the People Who Invented Shared Scooters (2018) - Scoot introduces stand-on e-scooters to our popular e-motorscooter and e-bike fleets.

The Snuggle (2017) - A riff on The Hard Thing About Hard Things after the birth of my son.

In the Cities of the Future, the People Will Drive Themselves (2016) - Why self-driving cars won’t take over cities. Not a popular opinion in Silicon Valley, but not yet wrong.

Why Apple Won’t Make a Car (2015) - Why whatever Apple is working on won’t be a car in the conventional sense. Still have my fingers crossed.

Conspicuous, but not Consuming (2009, with Stephen Linaweaver and Brad Bate) - We wonder if consumption of virtual goods could offset material consumption. Pre-NFTs :).