LimeBike Inc., one of the startups driving the proliferation of on-demand scooters and bikes in major cities, today announced that it has closed a $310 million funding round at a $2.4 billion valuation.

The investment has been a long time coming. Rumors about Lime raising more money started emerging in mid-2018, with one early leak having claimed that both Alphabet Inc. and its GV venture capital arm were planning  to participate.

Both were indeed named as investors in the new $310 million round this morning alongside Bain Capital, Andreessen Horowitz, Fidelity Ventures, IVP and nearly a dozen others.

The reason for all this investor interest is Lime’s rapid growth. The two-year-old startup has served no fewer than 34 million trips through its network of electric scooters and bikes to date, which users can access with an app similar to Uber Technologies Inc.’s ride-hailing service.

Lime’s growth is only accelerating, with the startup revealing today that it saw a more than 550 percent increase in trips over the past seven months. Lime is maintaining this momentum partially through an aggressive expansion strategy that has so far seen it move into over 100 cities worldwide. 

This rapid expansion is causing some some growth pains for the startup. In August, San Francisco municipal officials opted against granting scooter permits to Lime, Uber (with which the startup maintains a partnership) and Bird Inc., another major player in this market. The city cited safety concerns as one of the reasons behind the decision.

The potential risks posed by the rapid spread of light, electric vehicles are emerging as a serious concern outside San Francisco as well. Yesterday, Consumer Reports published research showing that over 1,500 e-scooter injuries have been recorded throughout the U.S. since late 2017.

Lime has been taking steps to try and address the issue. In November, the startup launched a $3 million initiative to distribute helmets and educate scooter users about safety practices. The startup is also actively building ties with municipal authorities as part of an effort to avoid the kind of regularly obstacles it’s been facing in San Francisco.

“Micromobility is growing at a faster rate than we have ever seen, but the industry is still in its early days. As we move into this next phase of growth and adoption, Lime is committed to leading the way in collaborating with policymakers, the industry and local communities,” Lime Chief Executive Toby Sun stated.

The startup has raised $855 million in funding to date.  

Photo: Lime