After several months of struggles of fending off bankruptcy and selling rumours, Chinese bike-sharing company Ofo is close to raising “hundreds of millions of USD” in its ongoing Series E round from existing backers like Ant Financial and Didi, according to people familiar with the matter cited by our parent company 36Kr on Wednesday.
Ofo has raised at least US$2.2 billion since its founding in 2014. Its latest fundraising announcement was in March, when it secured US$866 million led by Alibaba Group, with participation from its affiliate Ant Financial, Haofeng Group, Tianhe Capital, and Junli Capital, according to TechCrunch.
Prior to that, Ofo also secured a US$700 million investment led by Alibaba — with participation from a slew of investors including Didi — which it announced in July 2017.
Known for its bright yellow two-wheelers, Ofo has a relatively gloomy year this year, experiencing money troubles and downsizing issues, all pointing to the company’s much-troubled operations and fund-raising conundrum.
It has exited multiple markets like the US, for example, citing regulatory permit issues and decided to focus on mature and strong markets instead. The company has been rumoured to be close to a takeover by Didi, but Ofo’s founder Dai Wei debunked them, maintaining that the bike-sharing firm will remain independent.
On another note, Alibaba, through Ant Financial, is already one of the backers behind the third largest bike-sharing startup in China, Hellobike.
In China, Ofo’s main competition is Mobike, which was acquired by O2O giant Meituan in April for US$2.7 billion.
Takeaways:
— While Dai Wei, the founder of Ofo, has repeatedly maintained that the sunny yellow two-wheeler sharing company will stay independent, the firm is reportedly in talks to secure a substantial amount in funding from existing backers like Ant Financial and Didi in a bid to continue its fight against Meituan-owned Mobike, its strongest competitor in the country.
— Didi’s dominating position in the transport sector will help Ofo in its ability to continue operations and grow its user base. Didi is currently the country’s number one ride-hailing company.
Editor: Ben Jiang