The battle of the bike-sharing startups took a serious turn today with news that China’s Ofo has raised another $ 700 million in a round of venture capital (VC) funding led by Alibaba, Hony Capital, and Citic Private Equity. Didi Chuxing, the “Uber of China,” also participated in the round.
The news comes just four months after the Beijing-based startup raised $ 450 million, and its latest cash injection stretches Ofo’s total money raised to more than $ 1.2 billion.
Meanwhile, down in Shanghai, Mobike has also been turbocharging its warchest. A few weeks back it raised $ 600 million from notable names such as Tencent, which in turn followed a $ 215 million round six months previous.
Together, Mobike and Ofo have raised north of $ 2 billion in less than a year.
While Uber managed to corner much of the global e-taxi and ride-sharing market around the world before local players such as China’s Didi Chuxing had a sniff, it’s clear that their bike-sharing counterparts are determined to garner mindshare outside China before it’s too late — and this is partly why so much money is now being thrown around.
In addition to China, where it’s available in dozens of cities, Mobike expanded to Singapore back in March, followed by Japan and the U.K. last month, which is a precursor to a wider European rollout. Mobike has stated that it wants to be in 200 cities globally by the end of 2017, roughly double its current number of conurbations.
Similarly, Ofo has been slowly edging into new markets, including Singapore and the U.K., while it’s also been running trials in the U.S. By the end of 2017, Ofo also plans to reach 200 cities globally, across 20 countries.
It’s almost as though Ofo and Mobike are working from the exact same blueprint.
Meanwhile, in the U.S., California-based LimeBike recently nabbed a more modest $ 12 million in funding to launch in its first few markets, which is essentially small areas of Florida and North Carolina for now. Though many cities around the world offer some form of bike-sharing service operated by local authorities, the likes of Mobike, Ofo, and LimeBike are all roughly comparable insofar as they don’t rely on stationary docking stations — you can park and lock the bikes anywhere.
Both Mobike and Ofo have both proven their case and their worth, to an extent, in their domestic Chinese market. And now they’re doubling down on their efforts to grab hundreds of international markets too, before local players such as LimeBike can gain traction.
But whether there is the same appetite for such a service in western markets, or elsewhere for that matter, is the $ 2 billion question.