SINGAPORE: The three founding members of local start-up SG Bike had different ideas of what their future would be like before they started the firm.
Chief technology officer David Lim, an economics graduate from University College London, wanted to be an investment banker. Marketing director Benjamin Oh eyed a career in public relations, while the company’s founder and chief operating officer Sean Tay wanted to be a nuclear scientist.
In a recent interview with Channel NewsAsia, the trio maintained that they had no regrets about their decision to start the company, even though many observers have noted that the bike-sharing industry in Singapore is at an ebb.
Since bike-sharing was launched in Singapore in 2016, the three companies with the largest fleets – oBike, Ofo and Mobike – have all faced issues staying afloat.
Ofo’s licence has been suspended due to the company’s issues in implementing a QR-code system.
SG Bike is potentially the industry’s last stand. If Ofo fails to get back its licence and Mobike’s permission to exit the Singapore market is granted, SG Bike will be the only company left with a full operating license.
And the company’s three founding members, who were former classmates in secondary school, expressed optimism that the tide would turn as the Singapore Government develops the cycling infrastructure.
Mr Lim, whose interest in bike-sharing was sparked by the bicycle docking stations during his university days in London, acknowledged that the firm is in survival mode. But if the company weathers this "transition period", it will reap the benefits.
He said: "In the future, the park connector network will be expanded, and there will be more push for mobility devices in Singapore. Bicycles will be the main mode of public transport, and we predict that it will eventually be a serious option.
“We will always look at Europe but we believe that Singapore has a vision to embrace cycling in a similar way. The struggle is temporary, it's painful, but the key thing here is to have faith," he added.
Over the last two years, Ofo, Mobike and oBike have reduced their fleets in Singapore, but SG Bike’s fleet has increased from 200 to 3,000. Mr Oh also confirmed that its number of users has been on a constant upward trend.
Mr Tay pointed to how Ofo managed to clock a million rides a month during its heyday in Singapore, and that signalled an interest in cycling as a genuine transport option.
The firm's founder, who grew up aspiring to work in academia, learnt the ropes of bicycle maintenance and operating a bicycle business while helping out over the school holidays at his father’s bicycle renting business at East Coast Park.
And his interest in bike-sharing was piqued when he saw how the industry had grown during a trip to Shanghai three years ago. He later contacted Mr Lim and Mr Oh to kickstart SG Bike.
EDGING RIVALS WITH FINANCIAL PRUDENCE
On how SG Bike managed to survive while the huge China-based firms failed, Mr Lim said the main difference was financial prudence – by only increasing its fleet size if the company could manage it.
"So financial prudence is one of the most essential skills that we as a team have and agree to stick by. In today's context, a lot of companies take venture funding, gain market share and aim to be the leader as soon as possible," he said.
“But what they don’t realise is that profit margin in bike-sharing is thin. When you increase the exposure with many bicycles, the operational cost will kill (you). We expand only when we have the capital - not borrow capital to expand."
Mr Tay added that having a senior management team who are Singapore citizens helped SG Bike anticipate the indiscriminate parking problem that plagued bike-sharing and resulted in the Land Transport Authority (LTA) imposing measures to ensure bicycles are left at designated parking zones.
"It's culture and behaviour. I knew that the Singapore Government would not accept (indiscriminate parking), we know how Singaporeans work. We want a clean and green city," said Mr Tay.
THE FIRST TO FINE USERS
While QR code-based geo-fencing was made mandatory only in January 2019, SG Bike introduced its own mechanism to ensure users parked their bikes properly when it started in 2017.
Its competitors allowed users to park anywhere they wished, but SG Bike installed a geo-station system in its fleet at Bukit Panjang and East Coast Park that would fine customers S$1 if they did not park in designated zones.
SG Bike created an RFID device, which emits a signal, and placed it at parking zones. Each bicycle has a signal receiver. If a bicycle is parked outside the range of the RFID, its user will be fined.
Mr Oh said that reception to this mechanism was understandably negative in the beginning.
"At the start, it wasn’t that good. We were the first and only company that fined users if they parked indiscriminately," he said.
The company even had to paint yellow boxes to demarcate parking zones, forcing them to negotiate with the land owners of these public spaces, including town councils, NParks and PUB, to obtain permission.
Across their area of operations, SG Bike managed to outline 2,000 parking zones.
'SHIFTING BUS STOPS'
Mr Tay acknowledged that users found this inconvenient, but the whole system would work if LTA designates enough parking spaces across the country.
"This is a similar concept to bus stops. You don’t want your bus stops to be shifting every single time. If it moves, it can get annoying. But this whole thing is contingent on there being enough yellow boxes," said Mr Tay.
Like many of bike-sharing companies, SG Bike saw a "good number of users" drop out following the implementation of LTA’s QR-code parking legislation in January 2019.
"We suffered a dip, but we have confidence this is a temporary thing. It's a matter of time before things turn for the better," said Mr Tay.
"To demand such a big behavioural change from the consumer, asking them to scan QR-codes and park at zones, that’s a huge demand. We hope users accept the way bike-sharing has changed and forget about the past."
Mr Tay predicted that the public will warm to the idea of bike-sharing again within a year, and some users have given feedback that the parking zones are a good initiative to make the city neater.
"If we keep on this trajectory and every single customer is accounted for, SG Bike will grow, definitely. The licensing regime was really a good thing. The Government took a step to modulate the parking," he said.
Mr Oh noted that the Government has already made efforts to boost cycling infrastructure by developing the Park Connector Network and marking out dedicated cycling paths in certain neighbourhoods like Bedok.
"They are already spending a lot of time to put in resources for this. There are tens of thousands of yellow boxes in Singapore. That is some commitment shown by the Government. They are serious about the industry," he added.
And Mr Tay is convinced that on-demand services like e-scooters and bike-sharing are here to stay as the government is keen to reduce car usage in Singapore.
"The Government wants people to give up their cars, for society to go car-lite, hence the sharing economy for bicycles and e-scooters [is] going to get more and more robust," he said.
“Then for companies like us who stuck to our guns, we hope that our efforts will pay off.”