E-scooter company Unicorn goes bust after spending big on Facebook ads

E-scooter company Unicorn goes bust after spending big on Facebook ads
By: WNG BBC Posted On: December 09, 2019 View: 68

E-scooter company Unicorn goes bust after spending big on Facebook ads

Electric scooter start-up Unicorn is shutting down after spending too much money on Facebook adverts.

Customers received an email from founder Nick Evans, saying he was "very sorry" and was trying to sell Unicorn's assets to offer partial refunds.

The Texas-based company sold just 350 of its $699 (£531) commuter scooters, according to The Verge. They have a top speed of 15mph and a range of 15 miles.

And start-up tracker Crunchbase said Unicorn had raised just $150,000.

"It saddens me to write this letter but we have run out of funding and are shutting down operations immediately," the email says.

"We unfortunately do not have the resources to deliver your Unicorns nor are we able to provide refunds, as we are completely out of funding."

The cost of "Facebook and Google ads, payments for loans, and other expenses" ate through the company's funding quicker than Mr Evans anticipated.

"A large proportion of the revenue went toward paying for Facebook ads to bring traffic to the site," the email says.

"Unfortunately the cost of the ads were just too expensive to build a sustainable business."

"This is infuriating and I am not happy with this company," customer Juliette Lopez wrote on Facebook.

And Rebecca Buchholtz wrote she was "heartbroken" after receiving the email as she had ordered her daughter a scooter for Christmas

The company has not posted on Facebook or Instagram since 20 June.

However, four weeks ago it wrote on its website it was on track to ship scooters on 15 December, adding customers would have their orders in time for Christmas and Hanukkah.

Though popular around the world, electric scooters are illegal to use on UK roads and pavements.

Read this on WNG BBC
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