Today in Christmas miracles: a failed electric scooter company is getting bailed out

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It’s a Christmas micromobility miracle!

Failed scooter business Unicorn is getting bailed out by rival company Unagi, after Unicorn had to shut down recently without any money leftover for refunds. David Hyman, CEO of Unagi, told The Verge that he can offer a $1,000 Unagi electric scooter to any of the 350 people who bought Unicorn scooters. Nick Evans, CEO of Unicorn and co-creator of gadget tracker Tile, confirmed the deal, and said he will offer refunds to anyone who doesn’t want the Unagi scooter and just wants their money back.

“We put together a creative solution,” Evans said. “I’ll be paying out of pocket personally to get this done, and it’s been pretty challenging, but I definitely want to do right by everyone.”

“It will cost us some money,” Hyman said, “but it’s some Christmas good will too.”

Unicorn emerged last summer as part of a new crop of e-scooter startups hoping to capitalize on the popularity of dockless rental services like Bird and Lime. It pitched itself as an affordable alternative to shared scooters. Unicorn’s all-white vehicles were rebranded Segway ES2 scooters with some high-tech add-ons, including integration with Tile, Evans’ other company, which uses Bluetooth to track lost items, like wallets, keys, or phones. The Unicorn scooters were priced at $699, which is about $100 more than the ES2.

Unagi scooter
Photo by James Bareham / The Verge

In an email sent to customers earlier this month, Evans said he spent all the money on advertising and marketing, as well as loan repayments and other expenses. That meant there was little leftover for production and deliveries. The company would have to shut down without any money leftover for refunds.

“We started Unicorn to make peoples’ lives easier,” Evans said, “and we absolutely did the opposite.”

Customers were irate, calling Evans a “thief,” a “fraud,” and accusing him of ruining their holidays. For his part, Evans says it was the “toughest two weeks” of his career.

“I am a Grinch,” he admits.

Unagi has managed to avoid the same pitfalls that have befallen Unicorn. It’s $1,000 electric scooter is based on a Chinese-made prototype call SWAN that never went into production. Hyman took over the rights to the design globally and funded it to completion. It’s also apparently a big hit with musicians like Kendrick Lamar, Chance the Rapper, Halsey, Steve Aoki and teen pop megastar Billie Eilish — which has helped Hyman raise $3.5 million in venture capital cash.

Hyman said that Evans reached out to him a month ago over LinkedIn to talk about the scooter business. “He said it looked like we were kicking ass, and that he wished he could say the same,” Hyman said. A few weeks later, he learned that Unicorn would be folding.

Hyman thought maybe he would buy Unicorn’s domain name and then reroute customers to Unagi’s website. But after further discussion they arrived at a different arrangement. First, Evans would wire an undisclosed sum into Hyman’s account. (Neither Hyman nor Evans would say how much.) Then, customers who bought a Unicorn scooter can choose one of two options: a free Unagi scooter or a full refund.

“I want this to end up with people better off than if they’d got a Unicorn scooter,” Evans said.

Hyman says he risks pissing off the several thousand people who bought an Unagi scooter at full price, but it was worth to spread a little holiday cheer.

“Here comes Hanukkah Harry on the electric scooter,” he said.

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