Those who can raise money are raising big
When most bike-sharing startups are facing difficulties on the capital market, the ones who had more prestigious backers seemed fine, namely ofo and mobike.
Series D
mobike raised $215 million Series D led by Tencent in January, with Ctrip and Huazhu joining as new investors; Foxconn and Temasek also came onboard later, adding at least another $85 million (the round aka “friends of Sequoia China and Hillhouse”)
ofo came with a $450 million Series D led by DST in March (the round aka “Didi’s investors”); in April, ofo also took some money from Ant Financial while collaborating in 0 deposits for users who have credit scores (Sesame scores) over 650.
Unique Angles?
This was the first time Ali officially invested in this field. I guess they felt the valuation was too high. While Tencent had mobike and Didi had ofo, Ali needed to find its unique angle and set its footprint in the space. Sesame scores is one of Ant Financial’s unique offering in the market place; yet ofo might be the first time users felt the tangible benefits of high Sesame scores.
Tencent had its unique angle as well: Mini-programs 小程序 in WeChat. mobike launched its mini-program in February 2017.
Meanwhile, Didi integrated ofo’s service into its app in April 2017.
(Besides, there are battles between payments, cloud computing, data and traffic)
Series E
The crazy financing has made ofo and mobike the clear winners at that time. I guess most investors believed that who had the most money would win the game.
ofo has Didi which is big, but mobike’s Tencent is one of the deepest pockets in China. When Ant Financial only provided a minority funding to ofo (as Didi was the biggest investor), some may felt that Ali was still not determined to join the race – then mobike would win.
mobike raised $600 million Series E in June, led by Tencent, valued at $2.4 billion pre-money.
Now, if ofo didn’t get Ali on board, it would almost certainly be outgrown, despite its entrance into 100 cities in May was one month earlier than mobike (June).
Not surprisingly, ofo came with $700 million Series E in July, led by Alibaba, valued at $2.3 billion pre-money.
Meanwhile, both companies were aiming to enter into 200 cities globally.
When mobike and ofo sucked up nearly all the resources in the space, other startups were falling rapidly (see the previous post).
However, the financing activities won’t help to eliminate many problems come with those station-free bikes.
to be continued…