MTS Invests in Micro-Mobility Service Urent
MOSCOW, Russia – Mobile TeleSystems Public Joint Stock Company (“MTS” or “the Company”) (NYSE: MBT; MOEX: MTSS), Russia’s largest mobile operator and a leading provider of media and digital services, has invested RUB 740 m in the equity share capital of UrentBike.ru, LLC (“Urent”), a leader on the Russian micro-mobility short-term rental market. The deal, which is aimed at expanding the range of services offered within the MTS ecosystem, was carried out as part of a recent funding round, which saw MTS as lead investor and also attracted investments from VPE Capital and the VEB Ventures fund operated by VEB.RF, who invested RUB 700 m and RUB 650 m, respectively.
Urent is Russia’s largest electric scooter rental operator with a fleet of over 60,000 e-scooters in more than 60 cities, representing more than 50% of the national market in terms of fleet size. Urent plans to direct the raised funds to expand its fleet, develop rental infrastructure, open service centers, launch B2B products, as well as train personnel and enhance end-user safety.
MTS Vice President for Strategy Alexander Gorbunov commented: “Individual mobility services are rapidly growing in popularity in Russia. We estimate that by 2024 the market for short-term micro-mobility will more than triple — reaching some 40 billion rubles — and e-scooters will occupy a key niche in last-mile transportation, which is located at the intersection of a range of emerging technologies, including fintech, IoT, big data, and video analytics. In the near term we plan to add e-scooter rental services into the MTS Premium ecosystem subscription and enable our MTS Cashback loyalty program to be used for ride payment. In addition, we are looking at marketing e-scooters under the MTS Brand as well as developing a new controller with a video registration service for Urent. For us, acquiring a stake in this attractive asset is an example of how MTS enables commercial partnership via investment, fully in line with the strengthening Urent’s market position.”
Urent Co-Founder Andrey Azarov commented: “The experience of other players demonstrates that ecosystem integration is a powerful growth for scooter-sharing services, and we are confident that the market leaders will be the companies that best integrate micro-mobility into ecosystem development. By cooperating with one of the largest ecosystems in Russia, as well as attracting investment partners that will support urban development, we can help provide environmentally-friendly electric transportation as an option for millions of Russians. Together with additional debt financing that we plan to raise in the near future, the total invested capital in Urent will exceed 3 billion rubles by the start of the 2022 riding season, which will enable us to make e-scooters more accessible in remote regions across the country.”
VPE Capital Managing Director Artem Komissarov said: “The micro-mobility business model, including kick-sharing, has successfully proven its effectiveness both globally and in Russia. We see significant potential for multifold market growth due to a continued increase in usage scenarios and ride intensity, upcoming urban infrastructure modernization, as well as future growth in the B2B segment. We are fully confident in the ability of the highly professional team at Urent to occupy a leading position in the kick-sharing market.”
VEB Ventures CEO Oleg Teplov commented: “Over the last year, e-scooter sharing services have gradually become a comprehensive mode of last-mile transit. Rental scooters are becoming particularly competitive for society and personal transport, given that traffic congestion can reduce automobile speeds to less than 30 kph. That’s why e-scooter services can provide an alternative for society that is easy-to-use, highly accessible, and supportive of urban development. We are also delighted by Urent’s advanced level of technology. For example, the company is already using 3D printers to produce plastic spare parts on-demand, instead of waiting months for delivery. These factors played a key role in the investment decision making process.”
Learn more about Urent at https://urent.ru/