
ViaCycle (YC S12) Is A Zipcar For Bikes, Coming To San Francisco Soon - koji
http://techcrunch.com/2012/08/15/yc-viacycle-bikesharing/
======
jellicle
I love the idea, but it's doomed to failure.

I live in a city with a bike-sharing system. It's deeply unprofitable and
exists only at the sufferance of the city government. There are a number of
flaws. Number 1 is that people who ride bikes don't rent them, they own them.
For $100 anyone can purchase a bicycle that will last indefinitely and be
available 24/7/365. Number 2 is that people vandalize the shit out of
bicycles. Seats will be stolen, tires slashed, bicycles thrown in the river,
cables cut. You're free to go after this sort of bicycle since it has no owner
- no one is going to come storming out of a nearby store and kick your ass.
Crackheads will steal a bicycle seat and try to sell it for $5 to get a hit of
crack - I have watched them do it. We live in a world where people are
routinely electrocuted trying to steal copper from live power wires and blown
up stealing gasoline from pipelines. Those bikes might as well have a sign on
them saying "steal me". If even ONE of the components can be removed and sold
for a few dollars...

[http://www.theglobeandmail.com/news/world/pariss-pedal-
power...](http://www.theglobeandmail.com/news/world/pariss-pedal-power-sets-
free-uncivilized-behaviour/article1186322/)

[http://www.cbc.ca/news/canada/montreal/story/2009/06/26/mont...](http://www.cbc.ca/news/canada/montreal/story/2009/06/26/montreal-
missing-bixi-bikes.html)

Combining high cost of bicycles, ongoing cost to repair/replace/corral wayward
bicycles, and low cost of the alternative (owning a bicycle), there is just no
chance that this can be a successful business. You will recall people talking
about the future of electricity, as being "too cheap to meter". Well,
electricity never made it that far, but time on a bicycle did. Bicycle-time is
too cheap to meter.

(There may be some future for the company selling to cities or other large
entities which intend to subsidize all the costs associated, but it can never
be successful as a stand-alone business.)

~~~
AkThhhpppt
Counterpoints:

<http://en.velib.paris.fr/>

<http://www.tfl.gov.uk/roadusers/cycling/14808.aspx>

<http://www.citybikes.se/en/>

<http://www.dublinbikes.ie/>

<https://en.wikipedia.org/wiki/Bixi>

~~~
jellicle
Not sure how those are counterpoints, in that they are all deeply unprofitable
services provided by large governments that are subsidized to the tune of tens
of millions of dollars per year. Maybe you should read my comment again.

~~~
SomeCallMeTim
I'm not sure how it matters that they're subsidized.

Cars are subsidized via road building/maintenance, after all, and it's likely
to cost less to maintain a few bikes than it does to maintain roads/parking
for the cars that would displace them.

Imagine if there were no transportation subsidies and road maintenance were
privatized. A nightmare. It seems entirely reasonable that forms of
transportation that can help bring tax revenues to a city are subsidized, and
therefore entirely reasonable to create a start-up based in part on those
subsidies.

~~~
jellicle
I think there's a qualitative difference between a business model that can
sustain itself and one that relies on rich backers to dump money into it every
year, forever.

Isn't HN usually full of people saying you have to figure out what customers
will pay for (meaning, what customers will pay more for than it costs you to
provide)? Bike-sharing is not one of those things. End-user customers will not
pay you more than it costs to provide.

~~~
SomeCallMeTim
"Customers" includes businesses -- and governments, for that matter.

A lot of successful start-ups don't sell to consumers at all. And kazevedo
comments that they are in fact structured as a B2B start-up. [1]

[1] <http://news.ycombinator.com/item?id=4387770>

------
jhuckestein
In Germany we have a system like this called call-a-bike (it's run by the
german railway!). It works surprisingly well. You're allowed to leave the
bikes wherever you want and if they are left unused for a while a truck will
come and move them back to a central location.

I really like what via cycle has done with the SMS unlocking. Back when I was
in Germany, almost three years ago now (!), you had to call a service line to
find/unlock a bike. Late at night there were usually wait times and it was
especially difficult to manage the entire process if you were a little tipsy.

There's similar systems in many other European countries. I hear great things
about a system in France called velib (I think).

 _Edit: I forgot to mention, the German bikes also have a second seat on the
back. I'm not sure from the picture if this is also true for viaCycle but it's
definitely one of the best features. Here's a
picture<http://www.pedelecforum.de/forum/imgcache/5382.png*>

~~~
koji
Call a bike in Germany is definitely a great system! viaCycle strives to
improve on this by geo-fencing the bicycles when they need to be checked back
into the system (and so you are no longer charged for usage). This helps
maintain distribution and gives users reliable, structured locations to get
bicycles, so they're not just strewn across cities.

~~~
jhuckestein
Yea, and logistical problems like that are what gets me excited about this.

In grad school I did research on a on increasing the average vehicle occupancy
in cities and we took a lot of inspiration from the bike sharing programs.

Have you considered offering dynamic pricing based on the likelihood that the
bike will be used in the near future? I.e. riding into the city should be
cheaper than riding out of the city in most cases.

~~~
kazevedo
Absolutely! Dynamic pricing is something we're really excited about. It's
still a young idea, but even large systems like Velib have implemented simple
incentives for people who ride against traffic flow. Since our bikes always
know where they are, we can be much more proactive about balancing each
system.

 _Edit: a few of us did graduate transportation research as well, your work
sounds cool. Is it published anywhere?_

~~~
felix_faber
I'm writing my master's thesis on exactly that topic.
[http://control.ee.ethz.ch/index.cgi?page=sada;action=details...](http://control.ee.ethz.ch/index.cgi?page=sada;action=details;id=301)

a) a heuristic for optimal routing of repositioning trucks based on
anticipated (uncertain) future demand.

b) dynamic pricing using a model predictive control approach (receding horizon
optimization on a model of customer reaction to (price) incentives).

Insanely cool stuff. And its working. A paper should come out soon..

~~~
koji
Let us know when it comes out! We'd love to give it a read.

------
crazygringo
How are they going to deal with the fact that demand is not geographically
distributed/balanced?

E.g. everyone wants to ride towards downtown in the morning, so there are no
bikes left elsewhere, and there isn't enough space downtown to hold all the
bikes. And only 2/3 of the morning people want to ride back in the evening,
because they're doing other things in the evening.

IIRC, some European cities have whole trucks that carry bikes between
neighborhoods throughout the day to solve this problem. But that only works if
you have big concentrated bike-parking stations. You can't do this if bikes
are parked all over the place on the street.

It would be really interesting if this service would pay _you_ to ride bikes
in the opposite direction of demand. But I can't imagine that would be
economical. There just aren't enough people to bike from downtown to the
suburbs in the morning, plus you're going to have to pay for them all to get
back downtown afterwards!

~~~
koji
Current bike share programs do require redistribution of bicycles, often as
often as twice a day. In large city operations viaCycle would likely be
subject to this as well, but that leaves operation costs nominal.

On university campuses we have seen the traffic to be much more free flowing,
as students do not follow standard commute patterns. During standard
maintenance bicycles can be moved around as needed.

We have discussed the possibility of incentivizing riders to help redistribute
bicycles, although the effectiveness of this has yet to be proven.

~~~
schiffern
>We have discussed the possibility of incentivizing riders to help
redistribute bicycles, although the effectiveness of this has yet to be
proven.

This is almost certainly because no-one has the data or analytics yet. Seems
like a very interesting problem algorithmically.

Even small incentives can have dramatic effects – look at the number of under-
employed who recycle aluminum cans for 5-10¢/pop. It's by far the most cost-
effective way to increase the rate of recycling. There are certainly quite a
number of people willing to move bicycles a couple miles for $1-2. I know I'm
beating the HN dead horse here, but markets do tend to be efficient at
allocating resources when the basic costs are set correctly.

With your mobile app, you have the advantage that you know not only where a
bike was picked up, but how far the customer had to travel to reach it. With
so much data at your disposal, you should be able to get a pretty good
predictive handle on the ebb and flow of demand in the system.

It'll be cool when I can subscribe to a higher tier to have my demand weighted
more heavily. ;)

~~~
koji
We couldn't agree more! One of the things we're very excited about is the
amount of data viaCycle's system can collect and organize. And because we're
not tied to permanent infrastructure we can be flexible; adjusting to usage on
demand, etc. Some of it may work, some of it may not, but we're looking
forward to pushing the traditionally slow-moving transit world into the
future.

------
graeme
Interesting. I'm in Montreal, the birthplace of Bixi, which runs the London
bike share program, and the upcoming NYC program as well as many others. Works
fairly well, but apart from the cost the docking stations cost the city
parking revenue.

One major administrative cost is moving bikes around. People tend to take them
downtown during the day, and out of the town at night. Even if you don't need
docks, you still have to move bikes.

~~~
kazevedo
Definitely true. Redistribution is always a hurdle, though with viaCycle's
realtime data, we can do some very cool things with incentives and pricing to
help the system balance itself.

Bixi takes a lot of parking spots partly because finding space for large
stations is difficult. By using existing bike racks, we can often put in bikes
without modifying anything. Plus, although parking is lucrative, replacing
room for one car with 10 bikes that 100 people can use is a good trade in our
book.

~~~
graeme
Oh, I actually meant via cycle avoids the parking revenue loss. It's a good
thing.

The pricing incentives idea is awesome. A win for commuters, free marketing
for your service, and free labor.

Someone would need an account for that, with payment info. Any plans to
increase account uptake to serve that purpose?

~~~
kazevedo
Ah, got it. Thanks!

We do take payment info on signup. Right now programs are localized so we set
up different websites for each, but we hope to link everything together in the
future. You can see an example at <http://gt.viacycle.com>

------
orang55
Yes, the cost of installing a Bixi-like system is fairly expensive.

However, when you're talking about transportation systems, Bikesharing is an
absolute steal. Repaving a city street costs $338,000 per mile. A city bus
costs anywhere from $500-750,000. Subway cars and commuter railcars run in the
range of $2 million _each_.

A 15-dock bikesharing station plus 8 bikes costs as much as a Lexus.
[http://www.capitalbikeshare.com/assets/pdf/cabi_station_spon...](http://www.capitalbikeshare.com/assets/pdf/cabi_station_sponsorship_flyer.pdf)

Washington, DC built its entire bikesharing system for somewhere between $6
and $10 million. That's way less than the cost of a single 8-car Metro train.

If we're talking about a system for a large city, the infrastructure costs are
low enough as to be irrelevant. If the system can cover its operating costs
(which DC's does, even at a surprisingly-high $1,860/bike/year cost), it's
basically a slam-dunk.

The bigger challenge will come from figuring out how to scale the system out
into the suburbs.

The problems associated with a decentralized system such as ViaCycle
(difficult to attract causal users/tourists, significantly more prone to
theft, much more difficult to redistribute, similar maintenance costs, more
expensive bikes) don't seem to compensate for the reduced capital costs.

~~~
Evbn
If you make cities livable, suburbs become obsolete (or densify into cities)

------
gojomo
Clearly, the time is almost right for my 'next wave' collaborative consumption
startups:

 _UnterCab_ : the Uber for pedicabs and piggyback-rides

 _SmallBearings_ : the RelayRides for rollerskates & skateboards

 _Hoparound_ : that seldom-used pogostick doesn't have to be gathering dust
anymore

~~~
koji
Love it. Money should be thrown at these ideas like it's going out of style.
Will the pogosticks needs GPS tracking and access control?

~~~
gojomo
Your phone's accelerometer is used to charge per hop. But competitive risks
include a secret self-jumping PoGoogleStick project.

------
physcab
ViaCycle should sell its locking system then anyone with an unused bike can
participate in the program!

~~~
scdoshi
That is definitely something we have discussed, once we get the unit cost down
and some further miniaturization in hardware.

We'd love to hear if more people think a consumer device like that would be
useful.

------
carlob
I love bikes. I love the idea. I've loved living in Paris where a similar
system was in place (Vélib').

However I think this is a textbook example of the shortcomings of capitalism:
while it is great for everyone to live in a city where you can use such a
bike, there is no way in hell this will pay for itself.

JCDecaux operates the Vélib' system and was estimated to get the equivalent of
2000 euros per bike per year in advertising concessions from Paris'
municipality [1] and still not to make a profit.

As pointed out by others there are very high running costs and I believe the
only viable way to pay for this is through taxes. I also believe taxes are the
only just way to pay for it, because everyone benefits from living in a city
with more bikes and less cars not only the users.

Again, I'd love to be proven wrong and see SF become a greener city through
this, but I'm a bit skeptical.

[1] in French <http://fr.wikipedia.org/wiki/Vélib%27#Viabilit.C3.A9>

------
jasonkester
This is pretty common in Europe, and as mentioned elsewhere here, somewhat
doomed. I couldn't find anything in the linked article explaining how the
founders hope to improve on those programs.

In particular, I'm curious to see how they plan to avoid the "Velib Extreme"
phenomenon:

<http://news.bbc.co.uk/1/hi/world/europe/7881079.stm>

<http://www.youtube.com/watch?v=afE44cHNkEg>

------
makmanalp
We got this in Boston / Cambridge / Somerville: <http://www.thehubway.com/>

------
maartenscholl
Concerning the design of the bikes, I think there is still room for
improvement. The designers can look at the design of the Public Transportation
Bike ("OV-Fiets") in the Netherlands[1] which was a major success in a country
where there already were more bikes than people before it's introduction.

For a bike that is available 24 you would want a bicycle lamp on the front
with a dynamo instead of just reflectors. This is a safety concern because
reflectors have proven to be unreliable to signal other road users.

The bike doesn't have any mudguards but I suspect the weather in SF allows
that :).

The carrier on the back wheel doesn't look that sturdy and there is a large
gap in the middle. A front rack to place heavier cargo on could be a benefit.

What about bright colors so the bike stands out?

[1][http://www.ov-fiets.nl/binaries/content/gallery/OV-
fiets/nie...](http://www.ov-fiets.nl/binaries/content/gallery/OV-
fiets/nieuwsbrieven/zakelijk/vrouwopfiets_270_211px.jpg)

~~~
soperj
Why would you want a dynamo if you could just have a battery powered led?

~~~
maartenscholl
Batteries don't last and you need access to them in order to replace them,
making theft easier. There are systems that integrate a dynamo in the chassis
of the bike. It's also more environmentally friendly because you provide the
power for the lamp. The article mentions there already is a battery in place
powered by either solar or dynamo.

------
elmarschraml
Bike-for-hire systems are like public transport: hard to run at a profit, but
useful for a city to have. Most systems I know (Velib in Paris, Callabike in
Munich) are very popular, but effectively run and subsidized by the
government.

ViaCycle does not plant to operate the bikeshare, but providing the bike
infrastructure for the operator. Which is a smart move - because a) being the
operator is unprofitable and b) operators probably dont want to deal with the
bike tech.

I would love to see a standardized, mass-produced bike intended for rent-a-
bike services. It's really a different kind of bike - you need excellent
protection against vandalism and theft more than sportiness or low weight.
Also, each system currently has its own GPS/Phone tracking and hire system. If
a company liek ViaCycle provides a cheaper, standardized system, it would
probably lower the cost of runing a bike-for-hire system quite a bit.

------
kurtvarner
Their pricing structure seems super confusing. There's two full paragraphs
talking about it.

~~~
kazevedo
Thanks for the feedback. It can seem complicated because we provide the
billing platform but allow our customers to set pricing. Cities typically
charge a monthly or annual membership, while companies usually provide bikes
to their employees for free. Depending on who's operating your local program,
you usually only have to choose between a few options.

------
jasonlotito
First thing I thought of is Bixi up in Montreal (and in Toronto, London, and
Ottawa).

------
extraio
I'm wondering what happens when someone gets hit by a car and complains that
the bike didn't include a helmet.

Don't get me wrong. I love the idea in every way, shape, and form - but I have
serious questions about the legal safety issues.

~~~
kazevedo
Helmet use is an issue we take very seriously. Fortunately, safety has been
excellent for US programs, but we try to make sure everyone has access to the
right equipment and education. We do require users to sign a waiver saying
they understand the risks. Ultimately, it comes down to culture - grabbing a
helmet needs to become as natural as putting on your seatbelt or grabbing your
coat.

~~~
gregsq
I checked up on the Australian experience, a country known for strict
enforcement of helmet regulations, and found this. Perhaps you'll find it
relevant.

<http://www.cyclehelmets.org/1192.html>

------
koenigdavidmj
Puget Sound Bike Share ( <http://pugetsoundbikeshare.org/> ) is in the early
planning stages of getting something similar set up in Seattle.

~~~
koji
Seattle is located in King County, which has a mandatory helmet law for all
riders, regardless of age. Melbourne, Australia has a program with helmet laws
and it has struggled to maintain ridership. This is definitely a concern.
Vancouver, BC is also launching a program in a similar situation, so people
are watching it closely.

There is undoubtedly a solution out there, but it may take some time to see
how users adopt helmet requirements. We're definitely excited about the Puget
Sound planning that is going on. I would love to see bikeshare in my hometown!

~~~
philwelch
The concern to me is less the helmet laws and more the fact that it's not
actually safe to ride bicycles in most American cities without a helmet. It's
not like we have physically separated bicycle routes like Copenhagen or
anything--it's a basic safety precaution.

~~~
dprice1
I agree and was really surprised to see the rider in the video not wearing a
helmet, even though it is legal to do so in California if you are over 18 (it
is not, however, smart). The answer is to just carry one with you-- they
aren't heavy, and you can usually strap it onto a backpack when not in use.

As an aside, riding on the sidewalk in the business district of Mountain View
(the video is clearly Castro @ Villa) is not actually legal
([http://library.municode.com/HTML/16508/level3/PTIITHCO_CH19M...](http://library.municode.com/HTML/16508/level3/PTIITHCO_CH19MOVETR_ARTVIBIROSKCOELPEASMODEEP.html#PTIITHCO_CH19MOVETR_ARTVIBIROSKCOELPEASMODEEP._S19.51RIBISIPR))

------
lucaspiller
In the past I've used the government funded hire schemes in London and Dublin
extensively and have had good experiences with them. I know how much they
cost, so I'm happy to see an alternative.

The only issue I see with this is that it looks particularly easy to remove
their locking system. It uses a chain lock, so what is to stop me from
"locking" it without putting the chain through the wheel? From there is looks
easy to remove their hardware with a spanner as it seems to just be attached
to the pannier rack mounting points.

------
rsbrown
Yo, ViaCycle team: stop what you're doing right now and get an email signup
form deployed to your homepage ASAP.

I saw the headline, read the article, got excited, landed on the homepage,
looked for San Francisco on the list of programs... then left the site,
disappointed. You won't get a lot of opportunities to capture customers like
the one you just got (and lost) with me.

Use mailchimp or something similar and you can fill this deficiency in a few
minutes.

~~~
kazevedo
Problem fixed! You should be able to sign up now.

~~~
rsbrown
Done and done. Thanks for the response.

------
mmahemoff
"In addition, there is also an upfront cost of about $1,000 to $1,500 for
every bike."

A recent article from the Economist says London's bikes cost average price is
£14,460/bike each, subsidised by government and advertising. Companies like
ViaCycle will hopefully drop the price of these schemes.
<http://www.economist.com/node/21557527>

~~~
msrpotus
How are they so expensive? That doesn't sound right, unless it's looking at
the entire cost of the program per bike, rather than just the marginal cost of
a new bike.

~~~
gav
I'd also assume that the bikes cost significantly more because they want to
use custom parts so that they are worthless to thieves.

------
schiffern
Seems very similar to SoBi's offering. SoBi has the advantage of built-in
vandalism detection, welded on GPS tracker (it looks like ViaCycle's is bolted
on), a sealed shaft-driven drivetrain, and a more durable frame geometry.

<http://socialbicycles.com/>

Exciting times. It looks like the next generation of bike sharing systems is
arriving.

~~~
kazevedo
We do weld the locks to some of our bikes depending on the intended
environment. No matter what the method, the attachment is at least semi-
permanent and can't be removed by normal means. Since our system can be fitted
to multiple bikes, we can easily incorporate shaft drive or a different frame
if people want them. Our Biria frames are very sturdy and people love them!

------
codegeek
About time. In the US, we seriously need more emphasis on bikes and
encouraging people to use them for shorter commutes. We either have to drive
or walk (mostly). I once met a european lady (from Amsterdam I think) who
would not stop talking about how behind the US in terms of bike culture,
hardly any bike lanes on roads etc.

~~~
kazevedo
Hear hear! Things are changing for the better. Over the last 5 years, bike use
has more than tripled in a lot of major cities. Bike sharing has the power to
completely transform culture - Boston went from being rated the worst city for
biking in the US to one of the top 5 after Hubway's launch.

------
maccam94
We just got a similar system in Boston: <http://www.thehubway.com/>

------
chollida1
Good luck

We have this type of system( Bixi) in Toronto. When I first heard of it I
kind-of sneered at it. I wasn't sure who would actually use this system.

But it's pretty popular. Not sure if it makes any money though.

------
avree
There's a company doing this peer-to-peer (like Getaround, but for bikes)
called Spinlister. <https://www.spinlister.com/>

~~~
kazevedo
Spinlister is awesome. Eventually we hope to use our technology to automate
personal bike rentals, just as Getaround does for cars. We'd love to talk to
either of them about a partnership!

------
dougzor
This reminds me some of WeBike: <http://webikedoyou.com/>

Regardless, glad to see some fellow Yellow Jackets doing well! Good luck guys!

------
parsnips
How do they tackle the stolen/abandoned/damaged bike problems that plague
every community bike program?

~~~
koji
This was a major factor we considered in our design. Every bicycle is GPS
tracked, so you know their locations. The bicycles are designed to be rugged
so they hold up to abuse, and regular maintenance is part of operations. There
will always be issues, but nothing that can't be solved.

There are hundred of modern programs in operations around the world, and it
seems the theft issue has been overblown:
<http://www.startribune.com/local/minneapolis/149446485.html>

------
manaskarekar
I wonder if they considered calling themselves iCycle.

