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On any given Beijing street, look near the cars and taxis and buses, among the motorbikes, and you may notice a commuter on a scooter with a glowing white circle.
That distinctive logo belongs to one of China’s hottest smart electric scooter brands, Niu Technologies, a Beijing-based company that bets luxury electric two-wheelers will be the future of urban transportation—in China and beyond.
Li Yan, the company’s CEO, said Niu was founded upon the premise that cars are not the future of Chinese urban transit. The founders’ daily life served as inspiration, Li said, pointing to the snarling traffic jams and crowded public transportation in the Chinese capital. “We actually got frustrated in terms of commute living in the city,” he said.
Startups around the world are jumping on the so-called “micro-mobility” trend, which refers to non-car transit options such as bike-sharing, e-bikes and standing scooters like Lime and Bird. They all aim to solve the “last mile” problem, tackling the lack of transit options in the short distance between a user’s home and the nearest available public transit stop.
Niu scooters, like Tesla cars, use lithium-ion batteries. Niu—not to be confused with Chinese electric carmaker Nio—says it leads the Chinese lithium-ion powered scooter market in terms of sales volume with 26%.
China’s lithium-ion scooter segment is projected to grow rapidly, but currently accounts for a small portion of China’s $7.7 billion electric scooter market. Most Chinese e-bikes use lead-acid batteries.
In China, a conventional scooter sells for around RMB 2,500 (about $369) but Niu’s scooters sell from RMB 3,000 to as much as RMB 10,000 (about $443 to $1,478). Niu believes urban riders will upgrade their lead-acid powered scooters to more expensive but more stylish, more energy-efficient, cloud-connected smart scooters.
Niu has been a subject of interest in Chinese media due to its famous founder, Li Yinan, the former Huawei vice president and Baidu CTO who was in 2015 convicted of insider trading at private equity firm GSR Ventures. Niu’s growth hit a speed bump during Li Yinan’s time behind bars, though he remains Niu’s largest shareholder. CEO Li Yan said that Li Yinan will remain only a passive investor in the company.
Niu reported RMB 1.05 billion (around $155 million) in net revenue in the first nine months of 2018, 9.1% of which came from overseas markets.
Li said urban transit solutions in China—once known as a “bicycle kingdom” due to its affinity for the two-wheeler—can be translated to Europe, where Niu has turned its attention. The company is eyeing countries that are ready to switch to lithium-ion batteries, and in Europe, Li said, the market is ripe.
“The European guys are on a much, much faster pace on this one, so that’s why we’re doing very well in Europe,” Li said. Unlike in China, European scooter drivers tend to use gasoline, so a switch to lithium-ion batteries could give consumers greater cost savings.
Niu has also become a provider for six scooter-sharing schemes in Europe, New Zealand and Mexico. Li said Niu is well positioned to supply to sharing operators because the company’s cloud-connected scooters can be managed through a Niu API.
Niu made its New York debut with a rocky October IPO. The downsized $63 million they fetched in fundraising is less than half of the highest target noted in their initial listing plan. Niu closed its first day of trading at $8.65. On Friday, shares closed at $7.74.
Still, Li said, the IPO was an opportunity for worldwide publicity. “We’re not that well-known in Europe or the US or Southeast Asia or those countries that we want to be in,” he said.
Correction: This article previously misstated Niu’s 2018 net revenue. The figure has been corrected.