New Yorkers have racked up more than 7 million trips on Citi Bike, New York City’s bike-share system, since it launched late last May. More than 100,000 people hold annual memberships. Yet financially, Citi Bike needs help. According to the New York Times , Citi Bike is seeking somewhere in the range of $20 million to be able to maintain and expand the program. As the city’s transportation commissioner, Polly Trottenberg, has admitted , Citi Bike has faced “significant financial and operational issues.”

The company’s financial turmoil may be due, in part, to the structure of its main sponsorship with Citi Bank. The New York City Department of Transportation provides oversight for Citi Bike, but the program–which is the largest in the country–receives no public money, differentiating it from bike shares in other cities. The New York system is operated by NYC Bike Share, a subsidiary of the Portland-based Alta Bike Share, which also operates systems in Chicago, Boston, and Washington, D.C., among others. In a deal brokered by the Bloomberg administration, Citigroup is paying $41 million over the bike share’s first five years to be the title sponsor. Mastercard, the only other sponsor, paid $6.5 million.





The problem is that it can be hard to decipher where Citi Bike ends and Citibank begins, making it difficult to entice additional sponsors to join. When you allow one company to brand your service so completely, there’s little benefit left to offer other potential funding partners. According to the Wall Street Journal:

Alta was always expected to seek sponsorship, in addition to Citigroup Inc., which paid for the naming rights. Goldman Sachs Group Inc. lent the money up front to pay for start-up costs. Finding additional sponsors has proved challenging because the program has become so closely associated with its eponymous supporter, according to a person familiar with the matter.

Citi made a smart investment by inextricably linking itself with the popular bike share for a mere $41 million. Thousands of New Yorkers are riding moving Citi billboards around the city each day. For the bike share, the benefits of the partnership are less clear. By not securing enough Citi money to keep itself afloat from the outset without other sponsors, Citi Bike may have hobbled itself.

Scott Galloway, a marketing professor at New York University’s Stern School of Business, tells Co.Design that it’s not shocking that Citi Bike would have difficulties finding additional sponsorship. “When the first member on your team is A-Rod, it doesn’t leave a lot of opportunity or budget to other players,” he says. “When your first sponsor is Citi and it’s called Citi Bike, there’s not a lot of value for other advertisers. They should have known upfront they were selling one sponsorship, and should have planned accordingly.” (According to Bloomberg Businessweek, Bloomberg administration officials initially asked Citigroup for more, but were negotiated down.)

When your first sponsor is Citi and it’s called Citi Bike, there’s not a lot of value for other advertisers.

Citi has branded the bike-sharing service in New York so fantastically that trying to separate the bikes from their sponsor can be confusing. “It’s the visual and the verbal,” explains Kevin Lane Keller, a marketing professor at Dartmouth’s Tuck School of Business. First, Citi Bike and Citibank sound so similar that in announcing the partnership, then-Mayor Michael Bloomberg got them mixed up.

Then there’s the physical branding: In addition to the Citi logo, the bike-share network is plastered with the bank’s distinct shade of cobalt blue (a hue screenwriter Delia Ephron decried as having “distorted every view” in the city). website looks just similar enough to Citi the bank’s actual site (again, that blue!), to make me briefly question whether I was looking at a Citi-owned product. I’m not the only one who gets confused. Vandals have smashed Citi Bike docking stations in protest of Citigroup. Some “people don’t realize that Citi is just a sponsor and it’s Alta that operates all of this,” Keller says. “They assume this is all Citi’s.”