While Chinese bike-sharing giant ofo remained trapped in a cash crunch, its smaller rival, Hellobike, said it has secured new funding from existing investor Ant Financial, Alibaba Group’s financial and payment arm.
Aside from bikes and electric bikes, Hellobike is launching ride-hailing services in a challenge to Didi Chuxing, the country’s biggest ride-hailing platform.
Hellobike told Crunchbase News and Tech in Asia that it raised “billions of yuan” in the new funding round, led by Ant Financial and Chinese investment firm Primavera Capital.
The startup did not disclose the amount raised, but tech news website 36kr, citing local media reports, said the funding round secured 4 billion yuan (US$581.6 million), taking its valuation to more than US$2.5 billion.
Reuters reported in November that Japanese tech investor SoftBank had been in talks to invest in Hellobike, citing sources with knowledge of the matter.
Hellobike was already valued at over US$2 billion after Ant Financial invested in the company last year.
Founded in 2016, Shanghai-headquartered Hellobike merged with Youon Ditan, an affiliate of Changzhou Youon Public Bicycle System, in October 2017.
While market leaders targeted first-tier municipalities, Hellobike focused its services on third- and fourth-tier cities. Currently, it has more than 200 million registered users across 300 cities in China, according to its website.
Under the Alibaba camp, Hellobike has raised US$1.8 billion since its founding, according to data from Crunchbase. Ant Financial has participated in multiple funding rounds for the startup, including a US$350 million round in December 2017.
The startup also counts Chinese emerging carmaker WM Motor, conglomerate Fosun Group, and venture capital firm Chengwei Capital as its investors.
In September, the company rebranded itself as “Hello TransTech” in a bid to expand into other transportation services.
In October, it started to offer taxi-hailing pilot services in Shanghai, Nanjing, and Chengdu, local media reported.
In fact, on its mobile application, bike-sharing, electric bike-sharing, and ride-hailing are listed as the three types of services offered by the company.
Its ride-hailing services are limited to taxis, but recent ads showed the company recruiting car owners for its upcoming ride-hailing and carpooling services.
Hellobike’s latest fundraising round comes as the country’s bike-sharing industry is facing a shake-out after a massive expansion driven by huge investments.
Over the past few years, market leaders ofo and Mobike had raised billions of dollars from domestic tech behemoths such as Alibaba and Tencent Holdings (00700.HK). However, the two dominant players have put the brakes on expansion.
Ofo has been reported to be considering bankruptcy amid pressure from users demanding deposit refunds. Mobike, acquired by China’s dominant on-demand online services firm Meituan Dianping in April, is also downsizing its bicycle fleet and retreating from overseas markets.
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