Uber Buys eBike-Sharing Company

Uber Technologies Inc. has acquired Jump Bikes Inc., a Brooklyn-based “dockless” bicycle-rental startup.

Financial terms weren’t disclosed. But media reports have valued the deal at more than $100 million.

Once the transaction is completed, Jump will operate as a subsidiary of Uber. The two companies have been working together for about two months on a pilot program in San Francisco.

Jump was launched in 2010 as Social Bicycles by founder Ryan Rzepecki. The company, which operates a fleet of 12,000 bicycles in 40 cities worldwide, raised $10 million last autumn and had been considering a second round of funding prior to partnering with Uber.

Traditional bike-sharing services operate designated racks throughout a city where users can pick up or drop off a bike. Jump and other dockless services allow members to lock and leave a bike anywhere public bike parking is permitted. Jump’s bicycles have built-in U-bar locks that allow them to be secured to bike racks, light poles, benches and other street fixtures.

The pilot program in San Francisco involves 250 electric-assist bicycles equipped with GPS tracking devices. Uber members can locate and reserve nearby bicycles by tapping the “bike” option on their smartphone app. Rental rates start at $2 for 30 minutes.

At the end of a ride, users are required to lock bikes in designated zones shown on the app’s map. Critics have complained that dockless services have resulted in cluttered and obstructed sidewalks.

The deal is Uber’s first acquisition since Dara Khosrowshahi became CEO last August. In a blog post, Khosrowshahi said Jump will help Uber integrate access to multiple modes of transportation in its app and allow users to choose the fastest or most affordable option.

During the pilot program, the average ride distance on a Jump bike has been 2.6 miles—about the same as an Uber car ride—with each bike used about seven times a day. Uber plans to use data from its car service to help place bicycles in high-demand areas to increase utilization rates.