Gianmarco Carnovale, CEO and co-founder of Scuter, tells Startupbusiness the story of the start-up that is preparing for its first commercial launch in Milan in early November 2025, representing the culmination of an entrepreneurial adventure with unique elements that has overcome considerable challenges. The official launch date will be announced on 30 October during a flash mob marketing event organised by the start-up in various areas of Milan.
Gianmarco, after many years of working on Scuter with your co-founders and talking about it publicly, it is worth starting with the rumours that cast doubt on the project’s feasibility, which in the eyes of many seemed like a promise that would never come to fruition. While you were developing a completely innovative means of transport, the market was becoming saturated with sharing operators.
This is perhaps the key question for a start-up like ours, an engineering deep tech company that has spent many years working on the product – hardware that has never been made before, which needs to be certified and approved for road use, meeting stringent safety requirements, but also usability requirements for users – and which is now coming to market. Thank you for asking, and I will answer by starting with what we might call ‘gossip’: we live in a country where there are so many chatterboxes and snake oil salesmen that sometimes you end up being mistaken for one of them, and other times you end up under attack for reasons other than those that appear. Never mind, as co-founder and CEO, I have a responsibility to the team and investors to deal with concrete facts, and I don’t have time for haters. Getting to the facts: the market is far from saturated, the numbers say that shared mobility is an unfulfilled promise of transformation, which currently accounts for just 0.5% of European urban mobility, i.e. close to nothing. Cities are inundated with vehicles that are used occasionally and have been flooded onto the streets due to a frenzy of FOMO (fear of missing out) investments that will never see a return, and many municipal administrations are realising this. But above all, all operators are well aware of this, having sprung up like mushrooms over the years with indistinguishable services of no real value, and who today tend to pretend to be successful and growing just because they hope to find more funding to survive, with the ultimate dream of being saved by public subsidies while forming alliances to reduce competition and raise prices. The thesis on which Scuter was founded, aware that ours was a long and difficult road, is that all these players would encounter insurmountable difficulties due to a flawed strategy, regardless of their financial resources and their failure to control the central element of the value proposition, which is the vehicle. I am certain that the path taken by others does not work, and I am confident that the one we have taken is the right one. Now we will test it in the field; the time has come to remove any doubt.
And so you are finally about to launch in Milan, with a fleet of 200 vehicles. Why did you choose Milan, and what sets you apart from all your established competitors?
Milan was a strategic choice, both for its population density and the professionalism of its municipal administration, as well as the scale of the problem we are facing: eliminating private cars from the urban mobility equation. In Europe, Milan ranks among the top three cities in terms of demand for shared mobility and the search for alternatives to cars, making it the perfect open-air laboratory for gathering metrics on the popularity of an innovation such as ours. As I mentioned earlier, what sets us apart from existing operators is in our DNA: almost all of the others are buyers of off-the-shelf vehicles, adapted for sharing and integrated with software that is sometimes developed in-house and more often licensed. We have chosen to be something else: a tech company that tackles a problem by creating the necessary technology, and technology means above all the vehicle. We are an automotive manufacturer, as well as a software company, with the distinction of being the first manufacturer in the world that does not plan to sell vehicles but to enable the greatest possible efficiency in individual mobility in urban areas. Furthermore, our main business model will not be to operate a sharing service: we are launching in Milan in this mode, but it should be seen as the opening of the flagship of a network of cities where we will open through licences. In the future, we may still open other cities directly, but our preferred route is to enter into licensing agreements with local authorities and municipal companies, utility companies, transport and logistics companies, and local communities, which will operate the fleets locally while we manage the platform that brings them together and federates them in a transparent way for users.
Let’s talk about the vehicle: three wheels, cab-over, basic and sturdy, it’s quite a gamble. How did you arrive at this configuration and what were the biggest technical challenges?
The concept arose from an analysis of real pain points: we analysed those of users, local authorities and sharing operators in a working group that we set up at the request of Enel’s innovation division at the time when the sharing phenomenon was just beginning, and we concluded that effective sharing mobility was not possible without a specially designed vehicle with features not found in the consumer vehicles that operators were acquiring. Enel thanked us for the analysis and, after talking to automotive manufacturers to evaluate the possibility of commissioning a special vehicle, concluded that it required an indefinite budget and, above all, too much time to deal with, but encouraged us to explore the path by setting up a start-up. We co-founders, who had all the skills needed to give it a go, decided to move forward by talking to hundreds of people, collecting objective data, and gradually hypothesising features that would solve the obvious problems: bad weather stops most micro-mobility users, many drivers do not feel safe on a scooter in traffic, commuters want to arrive at their destination looking presentable and not soaked or dishevelled from wearing a helmet, helmet sharing is repellent even with disposable headphones, cars suffer from traffic and a lack of parking spaces, scooters are dangerous, bicycles require a long urban transformation to create many cycle paths, which in any case do not replace car-based mobility for short distances and lack of load capacity. Furthermore, all existing vehicle categories, being designed to be sold to private users, suffered from vulnerability to wear and tear and vandalism, and cannibalisation of parts for spare parts. In the end, we identified the characteristics needed to solve the various problems, but the engineering challenge to implement them was enormous. We had to maintain the agility of a scooter, which is essential in traffic and for parking, while ensuring stability, safety, autonomy and, above all, ease of use around a type of vehicle that had never been made before: a motorbike with safety and comfort features similar to a city car, with the ease of use and maintenance costs of a bicycle, based on replaceable batteries to ensure continuous use without stopping to recharge at a charging station, robust and durable, and approved for riding without a helmet, as only BMW had managed to do before us. It took 10 years of five cycles of design, testing, failures and redesigns in full lean logic, including a couple of forced stops due to running out of funds, which taught us a lot and helped us grow. The development of the solution is almost entirely Italian: software development and integration of licensed components in Rome, mechanical design in Caserta, production in Casoli in the province of Chieti in the industrial district of excellence for motorcycles with our partner IAT, and subcontractors in Abruzzo, Campania, Lazio, Marche and Emilia Romagna, in addition to the powertrain component, which is Asian. . We have also filed and obtained two patents on the mechanical architecture we invented for the steering and tilting front end, which was essential for creating a three-wheeled vehicle.
What are the next steps after Milan? Other Italian cities?
Milan is one of the best European markets for sharing, and it is our focus, where we are concentrating our efforts to demonstrate that we can satisfy users who have never tried sharing before with a solution that is more convenient and efficient than others, and which produces profitable unit economics. For now, we are only thinking about this area in order to run the service in the best possible way, while also learning everything we don’t yet know and that we will need later on in order to scale up. The next phase will depend on several factors. There are at least a hundred interesting locations in Italy and Europe, but the ambition on which we have built the project is global, and we will define the steps for replication and scaling with our investors. The most important thing to keep in mind, however, is that much of the development will also be based on the best opportunities we find in agreements with local licensees.
You mentioned investors. How did fundraising go, and what were the most difficult moments during these years?
The fundraising process was, I would say, educational. At first, it was easier than I thought: friends and family, a European grant, equity crowdfunding, awards and recognitions came in quick succession, and we were set to launch in 2019, when we were finalising the fourth generation of the vehicle and a large company was soft committed to investing and bringing us to market. Then that investment fell through at the last minute due to a corporate reorganisation on the part of the investor, and we found ourselves having to build a new complex financial strategy: we realised that in those years no foreign investor would subscribe to a seed round for an Italian hardware-based start-up, and at the same time none of the very few Italian seed funds would bear the entire risk alone, especially at a time when everyone seemed to be going crazy over scooters, which we knew could never be successful. Not wanting to move to other countries, we decided to build a blended path with three sources of financing, starting with combining participation in Invitalia’s Smart& Start programme with a bank loan application for the fleet, supported in this regard by Banca Intesa Sanpaolo, which, through its Corporate branch in Caserta, supported us with asset financing for production, and a final component of capital, opening a SAFE. If just one of the three sources had not come through, we would not have been able to continue. But with a lot of hard work, we managed to obtain all three, through a year-long effort. It seemed like it was done, we had the funds for industrialisation, homologation, production of the first fleet, and market entry, but then the following events occurred in quick succession: a pandemic with a long blockade of the container ships that were to transport the Asian components we had purchased, war on the Ukrainian front where aluminium is produced, and even a bureaucratic mix-up with INPS, which had mistakenly assigned the Caserta employees to the Rome office, freezing Invitalia’s funds for the time it took to rectify the mistake: almost a year. At that point, with such a long delay, there was no longer enough cash for the commercial launch, and while we were conducting small pilot tests, we had to reopen the previous SAFE component with an extension and negotiate further debt financing with the bank. What saved us was our persistence, our obsessive attention to keeping costs low and capital efficiency high, our stubborn determination to tackle every technical problem we encountered and turn it into a learning experience, our transparency with all our financiers about the external factors slowing us down that were beyond our control, and even our admissions of the mistakes we had made. In the end, we built a solid base of investors and lenders who always understood one fundamental fact: we were there to do everything possible and impossible to protect the value of their investment and earn their trust. This meant that all our partners were not only capital providers, but also advisors, evangelists, connectors, and ultimately friends. Today, we are simultaneously closing the extension but also already thinking about the future Series A, for which we have several funds in the pipeline that understand and share our value proposition, are enthusiastic about the users who have tested the vehicle, and are just waiting to see the metrics of the city-wide mobility service.
In five years’ time, how do you imagine Scuter will be?
We are a technology company, and the core of our business is and will remain platform management, supported by the continuous development of both the software and the vehicle and its components. This allows us to maintain our technological advantage over the many who have approached us on several occasions, sometimes asking to buy the vehicles, other times proposing to buy the entire company outright. We have politely declined everyone, as we are pursuing a profound and very ambitious transformative vision, creating what we consider to be a climate tech infrastructure with a technological road map that, in addition to moving individuals in the most efficient way possible, also looks at decarbonisation, energy management, monitoring, and even dual use for urban environments. Today, our enabling technologies are an electric vehicle integrated with IoT, a SaaS cloud, and an app. In the near future, we will be using many other technologies such as advanced sensors, energy storage, blockchain, machine learning, and autonomous parking. I would say that we are on our way to becoming the technological enabler and federator of a decentralised organisation, made up of many partners, which generates, transforms, and distributes value in all large and medium-sized cities around the world, from whose streets we want to remove privately owned cars. But so many things can happen between now and then that this is, for now, only the ideal destination of a journey that is still long, while in reality we are mainly concerned with taking the next step in the best possible way.
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