The versioneer script does not allow the creation of python modules which are sub-directories of a git repository.
ex:
repo/
.git
module1/
setup.py
versioneer.py
module1/
__init__.py
stuff.py
module2/
setup.py
versioneer.py
module2/
__init__.py
morestuff.py
While this directory structure may not be a best practice, it can be a useful construct when building rapid prototypes.