Ride-hailing company Bolt Technology OU is seeking credit support from the Estonian government after a switch to quarantine-friendly services didn’t make up for lost revenue and it couldn’t access bank lending under existing state guarantee terms.

The service formerly known as Taxify, a rival to Uber Technologies Inc., is asking for 50 million euros ($54 million) in loans or public credit guarantees.

The Tallinn-based company will need at least 15 million euros per month after losing 85% of revenue, two Estonian newspapers reported Thursday, citing a letter from Bolt founders and main owners Markus and Martin Villig. Bolt’s request to adjust the terms of the stimulus measures is in line with the general crisis environment “where all companies are struggling,” spokesman Marek Unt said.

This is a “problem for the whole startup sector,” Unt said.

Food Delivery

Bolt cut operating costs and expedited the opening of new services, including the launch of home food delivery and a new courier service. “Our internal measures have been effective both in terms of reducing costs and introducing new services,” Unt said. “We are considering all measures to successfully exit the crisis.”

The government is considering specific steps for startups and could also acquire stakes in such companies directly, IT and Foreign Trade Minister Kaimar Karu told reporters on Thursday, when asked about Bolt’s request. The government has reserved 300 million euros for buying stakes in strategic companies in its revised 2020 budget draft, with shipper Tallink seen as a key candidate for a temporary purchase.

Uber is also expanding a program for businesses to order food delivery to their employees’ homes in response to surging demand during the coronavirus pandemic.

Banks haven’t agreed to lend to Bolt, despite a guarantee from state fund KredEx, because they see the safety net provided by the existing terms as insufficient, Aripaev and Postimees newspapers said.

Jaan Lasmanov, another spokesman for the company, earlier cited stimulus packages targeted at startups by France and Germany as proof that “the startup sector needs a specific approach.” The company, which was valued at over $1 billion last year, signed a 50 million-euro venture debt deal with the European Investment Bank in January. It was profitable in two-thirds of its markets at the end of 2019, according to Lasmanov.

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