Deals | Alibaba Leads Ofo’s $866 Million Round, Upping Competition with Tencent-backed Rival Mobike

China’s top bike-sharing startup Ofo raised USD 866 million in a Series E2-1 round led byAlibaba, joined by Haofeng Group, Tianhe Capital, Ant Financial and Junli Captial. This is the biggest fundraising to date in China’s highly competitive bike-sharing sector.

Last week, the Beijing-based startup reportedly pledged its assets to Alibaba for RMB 1.77 billion(approx.. USD 280 million) to fund its cash-burning operations.

Ofo is locked up in an increasingly fierce competition with local rival Mobike. Founded in 2014 by DAI Wei, Ofo says it operates in 20 countries, serving 200 million users mostly from China. Ofo’s archrival Mobike boasts of 200 million users in 9 countries. China’s bike-sharing sector has seen over 20 startups bite the dust, while Didi Chuxing, China’s #1 ride-hailing company stepped into the field by launching a bike-sharing platform giving access to services provided by the beleaguered Bluegogo and its self-owned brand Qingju.

In a bid to win the dominance, Ofo and Mobike have taken side with tech giants. Alibaba is a major investor in Ofo and Mobike has Tencent behind its back.