Didi Chuxing, China’s largest ride-hailing company, may be about to get into bicycles. Bike sharing, to be precise. The company, which is in the process of finalizing its acquisition of Uber’s business unit in China, today revealed that it has invested in a young startup called Ofo which lets people borrow bikes.
The investment is said to be “tens of millions” in size, but it isn’t clear how much equity Didi has picked up. Ofo reportedly raised $4 million in investment earlier this month, Didi didn’t specific whether its capital was part of that round or extra to it.
The Chinese firms didn’t say a whole lot actually — as evidenced by Didi’s one paragraph announcement — but they did call the deal part of “a multi-layered partnership.” Didi didn’t respond to our request for further information about what that actually means, and how it plans to work with Ofo.
Reading between the lines, though, the tie-up could give Didi an opportunity to make a foray into cycles, perhaps by providing Ofo as an option inside its app. Beyond offering licensed and private taxi rides, Didi’s services also include chauffeurs, test drives, and a communal bus service.
Ofo was founded two years ago as part of a startup program at Peking University. It claims to have 70,000 bikes across 20 cities in China, with its 1.5 million registered users taking 500,000 rides per day. Bicycles are hugely popular in China — Beijing alone has nine million, which inspired a pop song — and they are particularly well used by students in the country.
Didi’s other investments follow more obvious strategic lines. In the past, it has put money into Uber rivals Lyft (U.S.), Ola (India) and Grab (Southeast Asia) as part of an alliance of solidarity that includes the sharing of ‘best practices’ and allows customers to roam between different ride-hailing providers as they travel. However, Didi’s acquisition of Uber China threw that alliance into uncertainty since that deal will see the Chinese company become an investor in Uber, while Uber, in turn, will take equity in Didi.
Featured Image: Ofo