By Andy Marquardt and Tyler Sexton-Holtmeier
Rising junior Grace Jaeger said she was a freshman when she first noticed the transportation needs on Northwestern University’s Evanston campus. Her first-year dorm was located roughly half a mile from her classes, and, as a result, she was frequently late. She found the campus shuttle system unreliable, and she resorted to calling Uber to avoid tardiness. This, she said, was the inspiration for EO — Northwestern’s first student-run subscription bike-sharing program.
Jaeger with a team of four other Northwestern students, officially launched EO this spring and expect to expand the campus service this fall. EO is a subscription-based service in which students pay $20 per quarter for unlimited rides and the ability to pick up and leave the easily identifiable purple and orange bikes almost anywhere on campus since the bike has a locking system triggered by a telephone app.
Within the first week, EO had over 100 memberships, more than 275 miles traveled, and — most notably — roughly 110 kilograms of carbon saved in Uber rides and car commutes. By April 22, only three weeks after the company’s launch, that number had risen to almost 500 kilograms of carbon saved, according to Jaeger. Carbon — as in the heat-storing carbon dioxide greenhouse gas — is the thermostat for turning up global warming.
“We want our system to decrease the environmental impact of students and community members by providing an affordable and accessible method of transportation,” Jaeger said. “And [we want] to create a culture of sustainability on campus.”
Thus far, EO has done just that, and the start-up is not alone. EO is just one of a growing number of bike-sharing programs that have been gaining traction over the last several years. Just outside Evanston, the city of Chicago is helping lead the charge in encouraging residents to opt to use carbon-free or low-carbon transportation such as biking as a means to mitigate climate change and reduce carbon emissions.
Most recently, the Chicago City Council, in tandem with the Chicago Department of Transportation, approved a $50 million expansion of the city’s largest bike-sharing program that partners with Divvy. As part of the expansion, Divvy bikes will now be available and accessible in all 50 of the city’s wards. At a press conference introducing the expansion, former Chicago mayor Rahm Emanuel explained part of his administration’s reasoning for supporting the investment.
“My administration has made it a priority to create a variety of high-quality, reliable transportation options to get Chicagoans and visitors where they want to go,” Emanuel said.
Under new Chicago Mayor Lori Lightfoot, support for green initiatives in transportation has continued. Julia Gerasimenko is the advocacy manager at the Active Transportation Alliance, a Lightfoot-supported non-profit advocacy organization whose goal is to improve conditions for bicycling, walking and transit, and engage people in healthy and active ways to be mobile. Gerasimenko said the expansion of Divvy bikes throughout the city is essential to ensure that all Chicagoans have access to bikes and low-carbon mobility.
“At Active Trans, we definitely advocated for bike-share to come to Chicago [in 2013] and we’ve been really excited to see the growth of Divvy over the years,” Gerasimenko said. “They will now be expanding to cover all of Chicago, and we’re really excited to see that happen so that everyone in the city can have access to biking.”
Chicago was recently named a winning city of the Bloomberg Philanthropies’ American Cities Climate Challenge, based on city plans to expand bike-share programs to reach 100% of the city and policies that support car sharing and transit ridership while reducing vehicle ownership overall. In doing so, Chicago joined 20 other American cities in sharing a $70 million grant from the organization to accelerate efforts.
Encouraging low carbon mobility options through bike-sharing is as important today as ever before. With more news every day unveiling the seriousness and pressing nature of climate change, the time for change is now. According to a recent report by the Intergovernmental Panel on Climate Change (IPCC), “global warming will likely reach 1.5°C between 2032 and 2050, causing massive increases in already life-threatening environmental changes if it continues at its current rate.”
This means that during the next 12 years, significant change must occur in the amount of carbon consumed across the globe to deter the climate from changing, and the planet from warming to life-threatening levels. A huge step in reaching this goal comes from the reduction of carbon through low-carbon transportation options. According to data published by the Environmental Protection Agency in 2017, 29% of all greenhouse gas emissions in the United States result from transportation -- the largest contributor of any one category.
Encouraging people to reduce their carbon footprint through low-carbon transportation options such as biking is a vital part of the ongoing fight. When asked of the importance of encouraging more people to use low-carbon transportation options as a means of decreasing Chicago’s carbon emissions, Gerasimenko said that it is absolutely vital.
“If we are able to make a substantial impact in the individual day-to-day choices that people are making in their transit,” Gerasimenko said, “I definitely think it would lead to decreased emissions and to better air quality for everyone.”
While Chicago was not the first city to launch a widespread bike-sharing service, the business of bike-sharing has expanded rapidly across the United States since Divvy bikes debuted in Chicago in 2013. More specifically, Motivate — the parent company that owns Divvy — has expanded its efforts vastly in recent years. Today, Motivate owns city-wide bike-sharing operations in nine major American cities, including New York, Chicago, Boston, and San Francisco, and has teamed up with major ride-sharing services like Lyft.
Not only is Motivate helping to promote sustainable and healthy low-carbon modes of transportation across the country, but the company is proving that doing so can be a profitable practice. According to a report from the Bike-Sharing Service Market, the global bike-sharing industry was valued at nearly $1.6 billion in 2018 and is expected to reach $5.4 billion by the end of 2024.
At Northwestern University, EO team member and co-founder Grace Jaeger also sees the profitability of bike-sharing, especially on college campuses like Northwestern’s.
“We believe EO is economically profitable on a campus like Northwestern,” Jaeger said. “It’s a niche community where we are all close and have pretty uniform needs in terms of where we need to go”
Commuting to classes is a high priority and, at Northwestern, EO fills that niche. Further, as a source of profitability, EO team members say they believe investors will be attracted to their service, and invest in their program, subsequently investing in low-carbon transportation.
“We believe that we can grow as a company by expanding to other campuses,” Jaeger said. This summer, Jaeger and the EO team say they plan to conduct research in order to determine which other campuses in the nation are marketable and open to EO’s expansion, as well as possible ways that they can best manage that potential expansion.
At a recent conference on sustainability held at Northwestern's Kellogg School of Management, ValueAct Capital founder and CEO Jeffrey Ubben stressed the importance of encouraging business leaders to invest in sustainability. Ubben said that, to change the industry, business leaders must work to make active investments and be a part of the change themselves, rather than giving their money to others as a way to promote change.
“You can’t go into the system, take advantage into it, then come out and try to fix it through philanthropy,” Ubben said. “You have to combine the two, and fix the issue from the inside and that’s what I’m trying to do…We are tomorrow’s company now and not yesterday’s.”
According to Ubben, profitability in sustainable businesses is the key to gathering investors as well as maintaining progress in reducing carbon emissions and mitigating climate change. In the greater Chicago area, bike-sharing companies like Divvy and EO are proving to be a profitable and sustainable business.
At a time when reducing the collective carbon footprint must be an ultimate priority for businesses and nations around the world, it is small businesses like EO, and larger corporations like Motivate, that must lead the charge. By creating profitable business models anchored in low-carbon mobility, and specifically bike-sharing, EO and Motivate are successfully doing their part.