U.S. e-scooter startup Unicorn spent all its money on Facebook ads and then announced that the project will be shutting down
Unicorn, a US-based electric scooter startup, recently sent letters to customers informing them that the project was shutting down due to a lack of funding, according to The Verge.
The company's CEO Nick Evans said that Unicorn spent most of its money on marketing and ads on Facebook and Google. The company transferred the other part of the money to its manufacturing partner as an advance payment for the production of the scooters, which cannot be returned. Evans wrote that Unicorn "failed as a business."
The firm is now selling its remaining assets in order to at least partially return the pre-order money to its first customers. But, according to Evans, this is unlikely. He told The Verge that Unicorn was able to amass about 350 orders in total.
“We could have continued moving forward and taking more orders and that would continue to fund the business, and if we did that might have been able to deliver the product, but we also may have not been able to sell enough Unicorns, so by doing that we would be risking more people’s orders. So we made the very, very difficult decision to stop,” Evans wrote. He also added that advertising was too expensive and competition was too high.
Unicorn was created in the winter of 2018 by Nick Evans, co-founder of Tile, a manufacturer of Bluetooth-enabled devices used for finding things, according to Crunchbase. In March 2019, the company raised US$150 thousand from Y Combinator in a seed round.
The startup was partnered with Segway / Ninebot, The Verge reports. The electric scooters could supposedly reach speeds of up to 15 mph (24 km/h) were also going to be equipped with GPS, integrated with the Tile application and were supposed to support locking from a user’s smartphone. The price of the scooter was US$699.