Bike rental startups are having a ball in China. Within a month of Mobike raising $600 million from Tencent, its competitor Ofo has now gobbled $700 million round led by Alibaba. The round was also participated by Hony Capital and CITICPE, followed by existing investors Didi Chuxing and DST.
Ofo aims to democratize access to rental bikes by leveraging technology. Bikes are tagged with GPS chips which enable them to be rented through a mobile app without needed to be stored in a central location.
Prior to this round, Ant Financial, Alibaba’s finance-focused affiliate, invested in Ofo in April this year. The company secured $450 million Series D led by DST in February, which valued it at over $1 billion.
“We will accelerate the pace of global expansion, and our new target is to be in 200 cities by the end of this year,” said Mobike CEO Davis Wang to Reuters. The fund will also be used towards Internet-of-Things (IoT) and artificial intelligence technology to support the brand.
Since its inception in 2015, Ofo has provided over two billion bike rides to more than 100 million users. So far, it connected 6.5 million bikes to riders in 150 cities across five countries. The company recently expanded overseas into the UK, U.S. and Singapore.
Meanwhile, Mobike, recently claimed to have served more than 10 million unique users, who have completed more than 200 million paid rides. Currently, it has operation across 21 cities in China, including Beijing, Shanghai, Guangzhou and Shenzhen.
On the lines of Ofo, Mobike intends to foray into overseas markets in Asia, Europe and North America this year.