FB Pixel no scriptCould latecomer bike-sharing startup Hellobike outrace ofo and Mobike? | KrASIA

Could latecomer bike-sharing startup Hellobike outrace ofo and Mobike?

Written by Zhao Xiaochun Published on   2 mins read

While many Chinese bike-sharing startups have bitten the dust in 2017, Hellobike has entered the fast track of development.

China’s bike-sharing industry was a well-established duopoly between Ofo and Mobike, until the unexpected emergence of Hellobike, a dark horse backed by Alibaba.

Ofo and Mobike used to be the front-runners in the industry in terms of fund raising  and operations. Their bright yellow and orange bikes have flooded Chinese city streets, overshadowing other smaller shared bikes in various colors.

While a bunch of Chinese bike-sharing startups have bitten the dust in 2017, Hellobike, to the contrary, has entered the fast track of development.


Taking off

Doing away with deposit partly contributed to Hellobike’s quick float. More and more Chinese consumers started riding the white-and-blue Hellobike two-wheelers, as they could do so without paying a deposit.

In May, Hellobike claimed the number of registered users has increased by 70% in two months since the company introduced the deposit-free initiative, while its rides surged by 100% during the same period.

A more significant achievement is that Hellobike’s daily rides has surpassed that of Ofo and Mobike together, claimed ZENG Ming, head of Academic Committee of Alibaba Group, in May.

Alibaba’s financial affiliate Ant Financial has led three investment rounds in Hellobike. The most recent one is a $321 million round which valued the startup at $1.47 billion, driving Hellobike to become the latest unicorn in China’s bike-sharing industry.

This dark horse startup is galloping ahead with the muscle of Alibaba, which also invested in Ofo. Besides, the company has also benefited from its strategy to primarily focus on expansion in second- and third-tier Chinese cities, avoiding a bruising war in first-tier cities with Ofo and Mobike.



Apart from its own efforts, Hellobike also links its development to rivals’ recession, referring to the decline of orders. A previous report in January stated Ofo has seen a 60% reduction in the number of rides compared to its peak.

In terms of fund raising, Hellobike also surpassed Ofo and Mobike, raising three rounds since October 2017. As investors become increasingly skeptical about bike-sharing startups’ loss-making position, Ofo has only raised a round since last July. Mobike was acquired by Meituan-Dianping for $2.7 billion this year, lower than the $3.45 billion valuation in its last round.


No.1 bike-sharing service

Maybe it’s time to ask the question: Will Hellobike outrace Ofo and Mobike to become the ultimate No.1 bike-sharing service in China?

At the moment, it’s still not a given. Hellobike’s most important backer Alibaba, instead of only betting on Hellobike, is also strengthening its control over its other investee company Ofo to fight Mobike. That means Alibaba is less likely to help Hellobike curb Ofo’s development.

Currently, Ofo is actively seeking alternative revenue streams to attract investments. The yellow bike operator has established a B2B unit to generate revenue from ads. It has also launched an in-app feed feature and is reportedly testing a mini-game to retain users.

Meanwhile, Mobike, after joining Meituan’s O2O platform, has just expanded its deposit-free service nationwide and added e-bikes to its orange bike fleets.

The war in China’s bike-sharing sector is far from over.


Editor: Ben Jiang & Elaine Huang



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