Consolidating the Micro-Mobility Space
This Last Mile Holdings profile is part of a paid investor education campaign.*
Last Mile Holdings (TSXV:MILE; OTC:AZNVF) is a technology-driven micro-mobility company that designs and manages turnkey solutions for a multi-modal future of urban transportation aimed at reducing traffic congestion and carbon emissions.
One of the largest micro-mobility companies in the United States by locations, Last Mile’s growth strategy focuses on consolidation through the acquisition of micro-mobility brands and technologies as well as exclusive shared mobility contracts with universities and municipalities. The company offers a broad product suite of proprietary e-mobility product types for rideshare programs and delivery services, including bikes, stand-up scooters, seated scooters and trikes. ”Offering multi-modal solutions is key to expanding our network of exclusive contracts,” said Last Mile CEO Max Smith.
Last Mile Holdings was formed through the merger of Ojo Electric and Gotcha Mobility in Q1 2020. The combined Ojo and Gotcha footprint and pipeline provide a near-term growth opportunity and effectively positions Last Mile as the leading micro-mobility industry consolidator. Last Mile is leveraging the strong brand, partnership networks and consumer base built by the Gotcha Mobility team over 11 years in the micro-mobility sector. The consumer-facing rideshare brand will continue to operate under the Gotcha Mobility name. Last Mile is currently integrating the tech platform so that its entire branded suite of products will be available on the Gotcha app. Formerly a separate public entity, Ojo now represents a branded product offering available through the Gotcha Mobility network.
Last Mile is expected to continue to invest in and acquire other brands and technologies that can operate independently or through the Gotcha brand as well as technologies that can be licensed out to other micro-mobility partners. This structure also allows for the acquisition of global brands under the Last Mile umbrella.
Alongside the closing of the Gotcha Mobility acquisition, Last Mile completed financing totaling C$8.3 million. The proceeds funded the acquisition and are expected to go toward funding the subsequent strategic rollout of approximately 11,000 additional mobility units across 80 locations in the United States in 2020. The company aims to increase its number of total deployed units to 27,000 by the end of 2021.
Last Mile’s management team is bolstered by members with a track record of accomplishments in the shared mobility industry, in raising funding for publicly-traded companies and in the organic growth of start-ups into multi-million dollar companies. The company’s Chairman is Louis Lucido, a 50-year veteran of the financial services industry and the founding partner of the US$148 billion investment management firm DoubleLine Capital.
Last Mile Holdings’ Company Highlights
- Deploying a broad suite of electric mobility products in exclusive markets.
- Proven business model consisting of exclusive mobility program partnerships with 35 universities and 45 mid-size municipalities, 80 percent of which are long-term contracts.
- Exclusivity and long-term nature of contracts allow for scalability with lower capital needs and the potential to deliver better ROI.
- Strong reputation in the shared mobility industry established through community engagement prior to each program launch that differentiates Last Mile’s Gotcha Mobility subsidiary from competitors in the shared mobility market.
- As of March 2020, 2,500 units have been deployed across the contiguous United States; with an additional 10,000 units to be deployed by the end of 2020 with a goal of 27,000 units by the end of 2021.
- Approximately 80 percent of the company’s active programs are cash-flow positive.
- Strong management team of industry and capital market professionals.
Last Mile Holdings Business Model: Consolidation and Exclusive Partnerships
Last Mile Holdings has adopted an acquisitive, roll-up strategy for fostering organic growth. As with Ojo and Gotcha Mobility, future acquisition targets are expected to operate as product offerings or wholly-owned subsidiaries of the company.
Respect for city planning and infrastructure as well as public safety are all top priorities for Last Mile. The company has never launched in any market without community support secured through a multi-year agreement. This partnership-first approach has led to a long-standing, trusted market reputation. Last Mile’s end-to-end management of operations enables quality control and best-in-class safety standards.
Seated scooter product offering
Ojo’s patented, custom-engineered seated e-scooter was purpose-built for both rideshare and on-demand deliveries. Designed for bike lane and street-use, the seated scooter e-scooter has two swappable 48-volt lithium-ion batteries allowing it to go over 40 miles on a full charge at a top speed of 20 mph. It also includes GPS technology allowing for geo-fencing and automated speed throttling. Seated e-scooters are currently available in Memphis for rideshare services and Baton Rouge, Mobile, and Atlanta for food delivery services.
Gotcha rideshare app and network
Gotcha is a rideshare company with an 11-year history operating e-bike and scooter sharing networks. The company has a portfolio of exclusive contracts with 35 universities and 42 municipalities. Gotcha was recognized as one of America’s fastest-growing private companies in 2018 and 2019 on the Inc. 5000 list. The company was also a finalist on Fast Company’s 2019 World Changing Ideas Awards in the Health and Wellness category for providing students with sustainable micro-transit products that encourage healthy lifestyles.
Proprietary E-mobility Product
Nationwide Footprint with Exclusive Contracts
Last Mile Holdings is targeting select overlooked markets with the potential to yield positive economics to build a large nationwide footprint. The company uses its contract partnerships with universities as a springboard to launch new partnerships with surrounding municipalities. As of March 2020, Last Mile has 2,500 units (seated scooters, pedal bikes, e-bikes and kick scooters), deployed across the contiguous United States with fully contracted permits pending for the deployment of an additional 10,000 units for a total of 12,500 units deployed into the market by the end of 2020. The company aims to increase its number of total deployed units to 25,000 by the end of 2021.
As of March 2020, Last Mile Holdings has exclusive partner contracts with 35 universities and 42 mid-size municipalities in the United States for a total of 108 contracted systems. Eighty percent of these partnerships involve long-term contracts. The ability to establish key community partnerships like these has been a key driver of growth and success for Last Mile.
Embedded Revenue Opportunity
Last Mile Holdings’ management estimates that the current partnership contracts present an embedded revenue opportunity of US$32 million annually. This revenue projection is based on conservative utilization estimates including 1.0 to 2.5 trips per vehicle per day for e-bikes, and 1.0 to 3.0 trips per vehicle per day for e-scooters for a total of US$300,000 average revenue per program. The estimated return on investment for all Last Mile products ranges from 3 months to 10 months. Approximately US$10 million to US$12.5 million of capital expenditure (CAPEX) will be required to deploy the contracted systems that have yet to launch during 2020.
Currently, approximately 80 percent of the company’s active programs are cash flow positive. Management attributes this success to the exclusive nature of its partnership contracts which protect the company from the competition. Looking forward, Last Mile projects revenues to grow from a pro forma basis of more than US$3 million in 2019 to roughly US$20 million in 2020.
Rideshare Market Comparables
Last Mile Holdings’ Management Team
Max Smith — CEO and Director
Max Smith has been a transformative C-suite executive for more than 25 years with 8 successful exits. Most notably, as Head of Corporate Development for World Color Press, Smith was responsible for executing an acquisition growth strategy whereby World Color doubled its revenues from $1B to $2B through strategic acquisitions which enabled World Color to go public as a growth company. While CFO of LinkShare, Smith created a growth plan that enabled the company to grow from a breakeven $20m adtech company to a high-growth, high-margin business that was sold to Rakutan for $425m 3 years later. More recently, as CFO of Blip.tv and Maker Studios, Smith raised capital and worked on two transactions whereby Blip was sold to Maker and then within a year Maker was sold to Disney for nearly $700m. Over his career, Smith has managed the acquisition and integration of over 40 companies and he has raised $Billions of capital including angel, venture capital, IPO and debt (senior, subordinated, and asset based loans) to finance strategic growth.
Louis Lucido — Chairman of the Board
Louis Lucido was the founding partner of the US$148 billion investment management firm DoubleLine Capital. Prior to his retirement at the end of 2018, Lucido spent 50 years in the financial services industry, most recently as Senior Advisor, Chief Operating Officer, and founding partner of DoubleLine Capital. He was previously at TCW as Group Managing Director. Prior to joining TCW in 2001, Mr. Lucido was the Chief Investment Officer at Delphi Financial Group, sitting on a number of subsidiary boards. Prior to that, he was the Chief Operating Officer at Hyperion Capital Management, working alongside Lewis Ranieri. Lucido is currently on the Board of Directors of BioCorRX, a healthcare solutions company on the leading edge of alcohol and opioid addiction treatment. From February 2013 until June 30, 2019 he served as a member and chair of the Board of Directors of Court Appointed Special Advocates (CASA) of Los Angeles. He is currently on the board of National CASA. Additionally, he was elected in 2013 to the board of Junior Achievement, Southern California and served until March 2019. He is currently on the boards of 826LA and the Lupus Research Alliance (formerly the Alliance for Lupus Research).
Sean Flood — Director, CEO of subsidiary Gotcha Mobility
Sean Flood is Chief Executive Officer and founder of Gotcha, an e-mobility company dedicated to providing innovative shared mobility products and technologies that get people out of single-occupancy cars and safely onto accessible, sustainable electric mobility products. The company operates e-bikes, e-scooters, and e-trikes as transportation solutions tailored to cities and universities across the US. Gotcha was recognized as one of America’s fastest-growing companies in 2018 and 2019 on the Inc. 5000 list and was a finalist on Fast Company’s 2019 World Changing Ideas Awards in the Health and Wellness category for providing students with sustainable micro-transit products that encourage healthy lifestyles. In 2019, Sean received Charleston Regional Business Journal’s Forty Under 40 award for his entrepreneurship in launching Gotcha and community involvement. A graduate of Florida State University’s Jim Moran School of Entrepreneurship, Sean founded Gotcha in 2009 with the committed purpose of partnering and collaborating with universities and cities to help solve fundamental transportation challenges through the utilization of sustainable and eco-friendly mobility options.
Sean resides in Charleston, SC with his wife, Jacklyn, and three children, Knox, Penn, and Lyla.
David Touwsma — Chief Operating Officer
As Chief Operating Officer of Gotcha, Touwsma is responsible for designing and implementing business strategies, plans, and procedures that lead to Gotcha’s overall growth and ensuring the financial strength and operating efficiency of the company.
Touwsma most recently served as the President and Managing Partner at R4 Holdings, LP in Atlanta. He led a team focused on growing their commercial and residential service brands including Bring the Bright/Christmas Decor (Holiday and Event Lighting), Green Army (Healthy Home Services), MosquitoNix (Mosquito Control), and SimplyCool (Outdoor Cooling Solutions).
Prior to his entrepreneurial endeavors, he spent nearly ten years in enterprise software businesses at Think Systems, i2 Technologies, PurchasePro, and iMany where he grew in many roles…Marketing Manager, Director of Alliances, Director of Marketing, Sales Manager, Vice President of Sales and Marketing. Touwsma began his career at Accenture helping clients transform their business in the areas of Strategy, People, Process, and Technology.
Outside of the office, he enjoys volunteer work with a heavy focus on leadership development. He served his college fraternity (Sigma Chi) as Chapter Advisor from 2000 to 2017 and currently serves as a Board Member of Sigma Chi International Education and Leadership Board (2017-2021). He also serves as a Trustee of the Georgia Tech Alumni Association Board (2016-2019) and a Trustee of The Boys and Girls Club (2018-2021).
He and his wife, Angel, enjoy traveling with their three children – Lucia, Laurel, and Brown. They take advantage of experiencing the country from their Vintage 1973 Airstream at any opportunity. His favorite hobbies include hiking and mountaineering, as well as anything on the water.
Touwsma holds a Bachelor’s Degree in Industrial and Systems Engineering from Georgia Institute of Technology.
Matt Tolan — SVP Revenue and Strategic Partnerships
Matt Tolan has more than 20 years of experience in driving revenue and growing market share by optimizing operational productivity and elevating the performance of global sales organizations. He has a track record of successfully transforming underperforming sales organizations, defining new approaches, and energizing the sales culture. At Avis Budget Group, Inc., Tolan fueled record-breaking revenue growth in government sales for 3 straight years and drove the Eastern US into the fastest-growing region in the corporate sales segment. He doubled revenue and expanded sales across Asia and Australia as the SVP of Global Sales at Carey International, Inc. As the SVP of Corporate Sales at Wheels Up, LLC, Tolan spearheaded the shift from high-net-worth individual sales through a rebranding to pursue corporate accounts. He has won accounts with other global and Fortune 500 accounts, including Accenture, Abbot, Deloitte, Ernst & Young, Johnson & Johnson, JP Morgan Chase, Lockheed Martin, KPMG, PWC, United Technologies, UPS, and Westinghouse.
*Disclaimer: This profile is sponsored by Last Mile Holdings (TSX:MILE). This profile provides information which was sourced by the Investing News Network (INN) and approved by Last Mile Holdings, in order to help investors learn more about the company. Last Mile Holdings is a client of INN. The company’s campaign fees pay for INN to create and update this profile.
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The information contained here is for information purposes only and is not to be construed as an offer or solicitation for the sale or purchase of securities. Readers should conduct their own research for all information publicly available concerning the company. Prior to making any investment decision, it is recommended that readers consult directly with Last Mile Holdings and seek advice from a qualified investment advisor.