Consortium led by Fosun invests in Shanghai-based bike-sharing firm
After a topsy-turvy year, China's bike-sharing industry saw a flurry of activities with a Shanghai-based firm getting funds from a consortium led by Chinese conglomerate Fosun.
Hellobike said on Wednesday that a consortium led by Shanghai-based conglomerate Fosun International and venture capital firm GGV Capital had invested 1 billion yuan (3 million) in the company's D2 round, or fourth stage, of financing.
Earlier this month, Hellobike completed its 0-million D1 series financing, which was led by e-commerce giant Alibaba Group Holding Ltd's financial arm Ant Financial. Hellobike finished its series A financing in November 2016 and series B financing in April this year. However, the exact amount was not revealed.
Founded in March 2016, Hellobike has been focusing on bike-sharing services in second- and third-tier Chinese cities. By Dec 22, the company had rolled out services in more than 150 cities and 140 scenic spots in the country. Its number of registered users has reached 88 million, with the number of daily orders exceeding 10 million.
Yang Lei, founder of Hellobike, said that the investment is crucial for the bike-sharing industry in China. The key is to make the investors realize that the investment is worth the money and their money has been used efficiently, he said.
"The war for investments will not be over in the short term. Industry leaders will continue to compete for investment for a while," he said.
Cong Yonggang, managing director of the new technology and economy industrial group of Fosun, said that Hellobike's management strategy and technology for improving transportation efficiency has set it apart from its peers.
"Demographically, there is room for at least 10 million shared bikes in the third and lower-tier Chinese cities," he said.
"The lifestyle and pace of living in the third-tier cities is different from first-tier cities," he said. "The average travel distance in third-tier cities is shorter but public transportation is not always in place. Therefore, people in these cities have a bigger demand for bike-sharing services."
According to Beijing-based market consultancy iResearch, the market value of China's bike-sharing industry has reached nearly 10.3 billion yuan this year and may touch 17.8 billion yuan next year. Mobike and Ofo account for nearly 90 percent of the market.