Tier banks $60 million in debt from Goldman Sachs to expand scooter fleet
Berlin-based Tier Mobility has raised $60 million to help the e-scooter company expand its fleet and its network of battery charging stations in 2021.
The funds, which come from investment banking firm Goldman Sachs, come just weeks after Tier was awarded the London e-scooter pilot permit, alongside Lime and Dott. With a major new city on the horizon and hints of further expansion plans, Tier will need a significant upfront investment to cover everything from fleet orders to local warehouses to new teams.
In November, Tier also closed a $250 million Series C funding round, led by SoftBank Vision Fund 2. The latest funds are asset-backed financing, meaning Goldman Sachs is essentially providing Tier with a loan that is secured by one of the company's assets, probably its scooters. Tier did not respond to a request for specifics on the loan.
The size of this highly scalable asset-backed debt facility is a game-changing first in micro-mobility, accelerating our expansion and cementing our market leadership in Europe," said Alex Gayer, Tier's chief financial officer, in a statement. This facility leverages our recent equity raise and will enhance our capital-efficient growth."
In addition to London, over the past year, Tier has added the coveted cities of Dubai and Paris to its list. It's available in over 100 cities across 12 countries in Europe and the Middle East. With the fresh capital, Tier plans to extend its international coverage and invest in its multi-modal fleet, adding bicycles and mopeds to the mix.
The Tier Energy Network is Tier Mobility's plan to place charging stations in retail stores to incentivize riders to swap scooter batteries.
The Goldman Sachs-backed funding will also enable Tier to expand its Tier Energy Network, a venture to place battery charging stations in retail stores across its coverage area. The energy network would provide an incentive structure for riders to take a minute at the end of their ride to swap the scooter's battery and earn free credit, while shops can enjoy the extra foot traffic.
Even amid a global pandemic, TIER has established a proven track record of profitable unit economics and asset longevity," said Ben Payne, managing director at Goldman Tier, in a statement. We are excited to help the European leader extend sustainable mobility to more people across the world."