Ofo, the app-based bike-sharing business based in China but now operating in 20 countries, has started piloting its service in seven cities in India, and has signed a partnership with mobile payments giant Paytm.
Smartphone-enabled bike-sharing is giving smartphone-enabled car-sharing a run ( or should that be ride) for its money when it comes to raising money. Since its launch in 2014, ofo has raised nearly $1.3 billion according to its Crunchbase entry, with the latest round a £540 million Series E last summer, led by Alibaba Group.
The release announcing ofo’s launch in India and the tie-up with Paytm says that ofo is the largest bike-sharing business in the world.
With more than $2 billion swelling their combined coffers, it is inevitable that there will be some interesting backers. Didi Chuxing, the world’s biggest mobility business, is an investor in ofo. Shortly after ofo announced plans to launch in India, Didi announced that it was integrating ofo into its app for users in China, starting in Shenzhen and Beijing. Didi is also “co-operating” with bluegogo, effectively rescuing the business which failed late last year after an unsuccessful attempt to launch in San Francisco.
And Didi is planning a branded bike-sharing business of its own and is looking at a bike-sharing meta platform which would aggregate various providers, in addition to ofo and bluegogo, into a single app. Didi’s creation of a global ride-sharing network is well under way and a similar network of bike-sharing providers would be an interesting extension of its “one-stop shop transportation platform”.
Ola, the Indian-based taxi-app business in which Didi has a stake, launched a bike-sharing business in India at the end of 2017.
Meanwhile, ofo’s partnering with Paytm as a payments provider also has the potential to grow into something more substantial. As well as being a standalone mobile wallet, Paytm is also an online platform which sells bus and train tickets but also hotels and international and domestic flights.
The connection between bike-sharing and travel is worth noting, and the relationship is pretty solid when Ctrip is involved. Admittedly, Ctrip has a lot of interests in a lot of businesses, but when it took part in Mobike’s $215 million Series C a year ago, Ctrip’s chairman James Liang said in the official announcement released by lead investor Warburg Pincus :
“Ctrip has been following Mobike’s development with great interest because we see it as not just a convenient everyday way of getting from A to B, but also an extremely valuable tool for travelers to explore and discover cities.”
When Ctrip sees bike-sharing as a valuable tool for travellers, and frames it in the context of exploring cities, many in the business need to take note – local guides could run tours using an ofo or Mobike, hotel concierges could find a bike for guests, attractions could link up and give visitors access to a bike to help them get from, say, the Tate Britain to the Tate Modern.
Taking note is not the same as taking action. “Bike + attraction tickets” is some way off and the margins might not be great but it is worth adding to the “one to watch” list.
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