Ofo, China’s bike-sharing companies valued at two billion dollars, plans to raise Series E funding of $700 million, led by e-commerce giant Alibaba, Hony Capital and CITIC Private Equity. Existing backers—ride-sharing firm, Didi and DST Global—also took part.
This is Alibaba’s first investment in China’s fast-growing bike sharing space. The bike sharing industry has risen to replace taxis, ride-hailing apps and other transportation options for people covering short distances across China. By simply scanning the QR code on a bicycle users can start their ride, and as there is a GPS chip on each bike, they can be left anywhere when the journey is finished.
Ant Financial invested in Ofo in April 2017, and now the parent company, Alibaba, itself is leading this financing round. Ant Financial has been a precursor to Alibaba in a number of investments. Ofo has raised $450 million in Series D led by DST in February, which valued the company at over $1 billion.
The latest round of raising funds will be the largest in the ride sharing industry. Ofo’s close rival has raised $600 million in a round in June 2017. Mobike is funded by Alibaba’s arch enemy Tencent.
“Ofo is committed to providing global users with a convenient, efficient, green and healthy way of travel. We will further upgrade our service for better user experiences, accelerate our global expansion strategy, and continue to lead the bike-sharing industry.” — Dai Wei, founder and CEO of Ofo
Ofo claims it has provided over two billion bike rides to more than 100 million users in the last two years. It said, it has connected 6.5 million bikes to riders in 150 cities across five countries. The peak in activity was at 25 million rides made per day.
Ofo plans to grow its fleet of bikes to over 20 million. It recently expanded in the UK after having added the U.S. and Singapore, and it plans to cover 200 cities by the end of 2017.
Mobike has similar targets, which itself is aiming to reach 200 cities worldwide with a focus on growing its presence in Europe and Asia. Mobike too claims a presence in 100 cities and over 100 million users.