Bolt Mobility, the Miami-based micromobility startup known in large part due to its co-founder Usain Bolt, received a lot of attention when it first popped up in 2018. And it came with lofty ambitions, looking to revolutionize transportation in a way that was safe and capable of leaving a positive impact. However, despite a strong start and a seemingly bright future, the startup abruptly shut its doors earlier this year.
People started to notice strange things happening earlier in the year when Bolt Mobility stopped operation in several US markets. The first areas affected included cities in Oregon, California, Florida, and several other states.
But the strange thing was that the exit did not happen as one might expect. Instead of a clear announcement from the startup, things just stopped. In some cases, it included abandoned equipment and unanswered calls, leaving utter confusion behind. Some city representatives even mentioned being unable to reach someone at the company, including the CEO. Bolt Mobility just vanished.
According to a statement made by the company on its website, equity investors were responsible for the abrupt shutdown. Specifically, Bolt Mobility pointed out that investors failed to “deliver on committed investment” and forced the company to scale back significantly.
Bolt Mobility continued to say that before the failure, the company still planned to remain fully operational. However, regardless of whether that is the case, the way the company handled things left a lot to be desired.
It is not just the cities and vendors left with abandoned equipment and unanswered questions that think so, either. Workers at the company also voiced complaints, especially since it appears many went unpaid for months.
According to the New York Post, employees were furious around the time of the shutdown in July. The reason for this was that the startup failed to send out paychecks in June, despite reassurances that the money was coming.
Employees felt that they might never receive compensation for their final month of work, leaving them feeling “lied to and manipulated.” And while Bolt Mobility did eventually provide remuneration, it only did so after its former employees went to the media, leaving people questioning whether the company would have done so otherwise.
Vendors and local governments also have a lot to deal with after Bolt Mobility’s sudden disappearance. The company left a lot of debt in its wake, beyond what it owed employees. In order to receive some of what they are owed, certain vendors and local governments have even taken to confiscating equipment with the company’s approval.
The entire thing goes to show how dangerous rapid expansion while relying on future funding can be. That is especially so in the current economy, where funding is slowing down after a manic period. In fact, the result of similar behavior can be seen in many startups, where excessive hiring and growth have now led to layoffs as things slow down.
Bolt Mobility’s CEO, Ignacio Tzoumas, revealed to the New York Post that the company is suing Ram Charan for backing out of the deal they had in place. Ram Charan is a chemical company based in Chennai, India that was supposed to offer a “strategic investment” to Bolt Mobility.