Startup News & Analysis

Sydney bike-sharing startup Airbike bucks the trend, launching trial run in Canberra

Stephanie Palmer-Derrien /

Airbike

Source: Supplied.

Homegrown bike-sharing startup Airbike is bucking the trend of its contemporaries, and launching for a six-month trial period in Canberra.

Australian Capital Territory chief minister Andrew Barr confirmed in a tweet on Sunday that the Sydney-based company will test a fleet of 200 dockless bikes in the capital city, starting on July 30. He clarified that Airbike will monitor the fleet, and “move any bikes left in inappropriate or unsafe areas”.

The news is a change in direction in the bike-sharing sector, following oBike’s withdrawal from Melbourne and the liquidation of parent company in Singapore, which was quickly followed by the news that ofo is also moving out of Australia. Sydney-based company Reddy Go is also reportedly “restructuring” its operations.

However, Airbike founder and chief executive Angus McDonald tells StartupSmart that his operation is different, and Canberra presents “a sound business model”.

Barr’s tweet was met with some criticism from Canberrans, with replies pointing out the shortcomings of dockless bikes in Sydney and Melbourne, and saying it’s “not a great idea”, while others predicted there is “going to be a lot of them in the lake”.

However, Airbikes are connected to the network by GPS at all times, rather than just through a bluetooth connection with the users’ phones, says McDonald, and this makes them easier to keep track of.

Launched at the University of Sydney two years ago, Airbike currently has just 50 bikes operating mainly around the university. However, the company’s core business is in providing software and manufacturing lines to other bike-sharing providers, says McDonald.

He declines to reveal who Airbike’s software clients are, but stresses that Airbike can tell where its bikes are with more accuracy than some of the other operators.

“Our technology is actually tracked,” he says. “We have a map that tells us where the bikes are at all times.”

“We know who has taken it there, and we can act on it,” he adds.

In fact, of its 50 bikes active in Sydney, McDonald says Airbike has only ever lost three, and two were subsequently recovered by the operations team.

“The GPS is actually really accurate,” he says.

The trial in Canberra will bring the total Airbike-branded fleet to just 250, however, McDonald says it was all about getting the location right.

“Canberra is the perfect city for bicycle sharing, and no one had brought it in,” he says.

“Basically, we already had suppliers, and they were on board with how we were going to do it.”

Airbike’s model is more community-based than some of the other companies, McDonald says, and the startup is taking a slightly slower approach to the market.

Having seen relative success at the University of Sydney, it’s now starting with the Australian National University in Canberra too.

If nothing else, the university offers “a flat open area with 50,000 students travelling day-in day-out,” McDonald says.

“If you look at all the bike-sharing companies abroad, they started in universities … they needed the students to learn how to use [the bikes] — they’re the adaptive ones,” he says.

One of the problems with the other bike-sharing operators was they “came in with 2000 or 4000 bikes, and there just wasn’t the demand there yet”, he adds.

Equally, some of the other operators “went in without having government support,” he says.

In fact, oBike’s ill-fated launch in Melbourne prompted an ultimatum from the then Lord Mayor of Melbourne Robert Doyle, who threatened to run bike-sharing operators out of town if they could not ensure their bikes were not ‘clutter’.

However, Airbike’s promise to manage stray bikes is not an entirely new concept. OBike also entered into a memorandum of understanding with the City of Melbourne, City of Port Phillip and City of Yarra councils, promising its bikes would not to obstruct footpaths, among other things, in an attempt to manage the issue.

McDonald maintains Canberra will be a more welcoming city for the bike-sharing movement.

“It’s a really bike-friendly place, the distances are huge, and there’s not much public transport,” he says, adding that since the announcement, he’s received “heaps of emails just raving support”.

And while the plan is to add more bikes in the future, Airbike will continue with its softly-softly approach.

“We want it to work in Canberra,” McDonald says.

“We will see how we go with supply and demand, but for now, we’re just testing the waters.”

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Stephanie Palmer-Derrien

Stephanie Palmer-Derrien is a reporter at StartupSmart.

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