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Steps to Starting a Bike Share

Post by
Mark Smith
Steps to Starting a Bike Share

We hear from entrepreneurs, city officials, students and many others that are looking to start a bike share. We wanted to share some of the key steps to consider when starting a bike share. This will be a three part blog post where each one is focused on a specific individual. This first post will focus on the key factors to consider for an entrepreneur.

For entrepreneurs, there are other factors to consider as well. First We’ll focus just on the steps to getting up and running. Then We’ll discuss other factors that should be considered when choosing a vendor to work with.

  1. Getting approval - Whether you want to launch in a municipality, on a campus, park or on a trail system, you’ll likely need to receive approval to operate. This could be as simple as applying for a permit, or it could involve presenting and getting approval from a City Council. The key is knowing where you need to get the approval from and determining each step in the process. This can take anywhere from a few days to several months. 
  2. Select a Vendor - This might be the most critical step for long-term success. When selecting a vendor, many factors should be considered. We go into more detail on this later.  Can the company grow with you? Do they provide a turnkey (hardware and software), or just one, creating more work for you? What expertise do they bring to the table? 
  3. When selecting a vendor, We believe the two most important factors (assuming each company considered has hardware and software that actually works) are the opportunities to make money through their platform and the support they provide you as an entrepreneur. Making money could be in terms of how many other products you  can expand into, will they provide you with other markets, are there features like in-app advertising and how much ad space is available? 
  4. Order and Launch - Now you have approval and you’ve selected a vendor. At this point, you are ready to design the program (how many products and what locations). You’re ready to place your order, but one thing to consider with this is lead times. If you’re fronting the money, you’ll want to know when your product is showing up/when you’ll start generating revenue. A recommendation we have with this is to seek all of your sponsorship funding during this time. It will help you to recoup your costs (or in most cases make money before you even receive product). Once the product arrives, you’ll already be generating revenue before your first rental! 

Here are a few other things to consider when selecting a vendor to partner with. 


White Label vs Joining a Platform  

Do you need to white label? If building your brand is the most important thing, then perhaps. Another thing to consider is the time it takes to build a brand, design, logos, advertising, etc. After all of this, you may spend a lot of money and still have no product. Not to mention the cost of white labeling alone will be a large sum of money tied up in software. In many cases, entrepreneurs choose to go a different route.

The direction they choose is to have their system part of a larger network. What other products are available to launch? What other communities are on the platform? Do your customers already have this app which allows them to find your products without even advertising? Being part of a larger network can help you grow more rapidly without spending a large sum of cash upfront. Reinvesting the white labeling fees, marketing etc. allows you to launch more products and generate more revenue. 

Key functions to Consider 

Features are nice, and all companies in the industry have them. Memberships, referral codes, and more. The features to really pay attention to are those which generate revenue for you. At the end of the day, that’s why you’re starting this business. Is there in-app advertising available? Can you bring corporate sponsors on the program and offer them discounts for a monthly fee? Can you determine your pricing and memberships? How much advertising space is available on the bike / rack? Each of these factors is critical to the overall success and growth of your business.


Locking & GPS Tracking

Spend time looking into the locking and GPS tracking of your system. There are a lot of options on the market. A couple factors to consider are lock-to or rear locking. Do you need a cable lock that allows the end user to lock to a rack? Alternatively is a lock around the rear tire a better solution? 

There are two types of GPS tracking. The first (and typically more affordable) tracks the GPS of the phone while in the rental. Once the rental is completed, you’ll know the last location of the rental, but will won’t be able to track the bike until the next rental. Though theft is relatively low for bike sharing bikes, this is something to be aware of. Another option tracks the actual GPS of the bike itself. Therefore you can track its location at any time. This typically costs a bit more, but it reduces the concern for theft. 


What low maintenance features are built into the bike? At Koloni, we provide a bike that has foam core tires, eliminating the concern for flat tires (a huge portion of the ongoing maintenance / operations). We also provide a 3-speed internal hub which reduces the opportunity for derailing (another operations issue). Ensure whatever bike you go with, that it is low maintenance and simple. Can you or any bike mechanic perform maintenance on it? 

If you’re considering launching a bike share program, it’s an exciting time! There are a few key decisions to make and we’re happy to assist in the process. We work with many entrepreneurs that go through this same process and can help you avoid roadblocks and speed up the process. If you’d like to learn more about getting started, you can apply here.