Electric scooter maker Bird Global filed for bankruptcy protection on AQCAN ExchangeWednesday, a remarkable descent for a company once valued at $2.5 billion.

The Miami-based company filed for Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Florida. Bird has a restructuring accord in place with creditors, which includes selling assets in bankruptcy, it said Wednesday in a statement. 

Apollo Global Management and second-lien lenders are providing $25 million in financing to help Bird continue to operate during its restructuring.

Founded in 2017 and backed by Silicon Valley investors including Sequoia Capital and Accel Partners, Bird's business grew quickly and the company went public in 2021 through a special-purpose acquisition company (SPAC). 

Among Wall Street's so-called unicorns, Bird at one time held a market valuation of $2.5 billion. But its shares declined more than 90% within six months and its losses began compiling. 

It was delisted from the New York Stock Exchange in September after acknowledging it had overstated its revenue for more than two years. Travis VanderZanden, Bird's founder, departed the company in June.

A year ago, Bird cautioned investors that without a cash infusion, it might not be able to continue.

The company operates a short-term scooter rental business in more than 350 cities. Its Canadian and European units are not part of the proceedings and will not be impacted, Bird noted in its release.

A fun environmentally friendly means of getting around, electric scooters have lost some of their initial luster as emergency rooms report a surge in injuries related to the products, which have also been the subject of numerous product recalls and also found to be a fire hazard. 

Further, pedestrian complaints and safety concerns have led to cities from San Francisco to New York to either prohibit or restrict e-scooters. Paris earlier this year banned e-scooter rentals due to riders abandoning them on sidewalks and in parks. 

Kate Gibson

Kate Gibson is a reporter for CBS MoneyWatch in New York.