In 2008, a group of local active-living advocates led by the Loppet Foundation and supported by the City of Minneapolis Community Planning and Economic Development Department and Mayor RT Rybak, put together the first nonprofit business plan for large-scale public bike sharing in North America. Blue Cross and Blue Shield of Minnesota, through its Center for Prevention, signed on as our title sponsor, committing $1 million to purchase bikes and stations. The City of Minneapolis applied to the Federal Highway Administration, through Bike Walk Twin Cities, for a grant of $1.75 million, also for bikes and stations. When those funds were awarded in the Spring of 2009, Nice Ride Minnesota was formed as a new nonprofit organization to own and operate the bikes. At the time, there were big questions: would bike sharing be safe? could we get insurance? would anyone sell us equipment? would Americans ride? could we cover costs with revenue? A group of local professionals, active-living advocates, and public officials joined our nonprofit board of directors to answer those questions.
Nice Ride launched on June 10 of 2010 (a month after Denver B-Cycle and three months before Capital Bikeshare). We operated 65 stations with 700 bikes in our first season. Our core business model had these elements: for capital to buy bikes and stations, use federal funding and title sponsorship; for operating revenue, use sales revenue and station sponsorship. The model worked. With support from many public-sector partners, particularly the National Park Service, and continued capital contributions by Blue Cross and Blue Shield of Minnesota, Nice Ride grew to 200 stations with 1,850 bikes in 2017. In the early years, we shared our learnings and results almost daily with planners around the country as every city with a convention center explored bike sharing. We were also instrumental in founding the North American Bike Share Association at a time when industry “growing pains” threatened our ability to purchase equipment. Read a longer description of our early successes and challenges in our Five-Year Assessment.
In 2013, in response to inquiries from small cities around Minnesota and the challenge of making station-based bike share feasible outside of a dense urban core, we developed our “Greater Minnesota” program and explored possible models to achieve the benefits of our station-based product with a staffed rental model. We also began exploring new tools and programs to achieve equity goals. Blue Cross and Blue Shield of Minnesota supported these efforts, purchasing over 700 orange bikes. We used orange bikes in Nice Ride Bemidji, Nice Ride Neighborhood, Wheelbeing, and Nice Ride Rochester. This evaluation of the Nice Ride Neighborhood program summarizes our learnings.
In 2017, the bike share industry changed dramatically. Dockless bike share start-ups, funded by billions in venture capital, launched in China, grew to over 20 million bikes, and expanded to over 250 cities worldwide. Observing this change, the Nice Ride Board of Directors concluded that dockless bike sharing was transformative and had potential to serve more people at substantially lower cost, but also concluded that its then-current implementation was not sustainable. The bikes were low-quality. Start-ups were under-investing in operations, maintenance, and equity. The “park-anywhere” model was in conflict with public sector goals. We chose a proactive approach. In August of 2017, we published a Request for Proposals for Transition of the Twin Cities Bike Sharing System. We sought a private-sector partner who would commit to: (1) operate our current equipment through a transition period, (2) meet service levels for quality, reliability, equity, and order in the right-of-way, (3) deliver a large dockless bike, e-bike, and winter bike pilot, and (4) reduce prices. This would require a large capital investment and multi-year operating commitment. To entice a partner to make that investment and commitment, we were willing to transform our nonprofit by transferring our team of seasoned operating employees, spare parts inventory, and equipment to the investor. We also sought and obtained an exclusive license to operate bike share in Minneapolis for the duration of our Grant Funded Agreement (which requires operations of a bike sharing system through August of 2021). For a detailed description of our transition plan and implementation, read our 2018 Update to Nonprofit Business Plan. Find more documents related to the transition below.
The transition plan worked. We selected Motivate International, the largest operator of bike sharing in North America, to operate our green bikes and deliver a dockless (blue) bike pilot. Our dockless bike pilot (1,500 bikes in Fall 2018; 1,500 more in 2019; and more in 2020 and 2021 if utilization thresholds are met) is the first in the world to require bikes to be returned to site-planned, permitted parking zones. The quality of the new bikes is state-of-the art. Our nonprofit is no longer an operator, but we continue to have a very important role. We are now a mobility manager, the bridge between public sector goals and private investment. We hold the license agreement with the City of Minneapolis. Motivate Minnesota (now a subsidiary of Lyft) is our sub-licensee. We are committed to deliver quality, reliability, equity, and order. We will do that by managing a contract with Motivate Minnesota that contains service levels and an equity plan.
We hope that our role as mobility manager can serve as a valuable example to cities attempting to encourage and shape privately-funded mobility-on-demand services. Whatever happens, we will share our results and lessons learned.
At a strategy workshop in December 2018, the Nice Ride Board adopted the following resolution:
The mission and vision statement of Nice Ride Minnesota continue to express our goals and guide our work. In 2010, our nonprofit stood as a working example of public/private partnership to operate a bike sharing system to achieve public goals. By sharing our results and learning, we helped cities across North America to develop similar partnerships and nurtured a new industry. Our role in that industry has changed. Today, we do not operate a system. We oversee contracts and facilitate collaboration between right-of-way owners and entrepreneurs to encourage private investment and innovation while assuring that public goals are achieved. We are excited by early results and are hopeful that our results over the next three years will again stand as a working example that is useful to other cities and will strengthen our industry during a period of rapid growth. We will continue to share our results and learnings. We will advocate that the principles underlying our approach be applied to other privately-funded shared mobility services. Those principles include: (1) joint action by right-of-way owners, (2) public benefit in exchange for the right to operate in the public right-of-way, and (3) continuous collaboration through a cycle of development. We will act as convener, advocate, and standard-setter.