Commuter Scooter Case Analysis

Commuter Scooter (CS) was created by a former car engineer Gil Hoffstedt and his daughter Hannah in 2008. Inspired by Jillâ??s need to get around L.A. in traffic, her Dad fashioned a minicar out of a Scooter using a third wheel for additional balance and to create an interior space. Started as a subscription rental service, it has evolved into a monthly subscription service which adults can use by the hour or the day, week or month. Small enough to still be called a scooter, it also is hefty enough that cars will not attempt to infringe on the CSâ??s lane in traffic as is the tendency with motorcycles. It runs on a photovoltaic battery and a backup diesel system. This allows for a very economical ride. The CS has a GPS system to alert riders to the nearest Depot where they can drop off the CS or they can renew use via their onboard GPS system as well. As a startup CS did not have a lot of venture capital. It was basically financed through bootstrapping methods (credit cards, family, second home mortgage etc.).

As they entered the market at the end of 2008 with 20 scooters positioning the first Drop-off area around local colleges, there has been a steady increase in demand. However, CS founders Gil and Hannah both realize that word of mouth and the few advertisements and reviews they have received is really not enough to propel the demand sufficiently to stay in business very long.