START-UPS

Apple’s Tim Cook shows strong support for Beijing bike-sharing start-up Ofo

Ofo is backed by Chinese car-hailing giant Didi Chuxing in which Apple made a rare investment of US$1 billion in May 2016

PUBLISHED : Tuesday, 21 March, 2017, 4:23pm
UPDATED : Tuesday, 21 March, 2017, 4:24pm

Apple chief executive officer Tim Cook visited the Beijing-based bike-sharing start-up Ofo on Tuesday amid the intensified fund-raising competition in China’s so-called “Uber-for-bikes” market.

One of the country’s major players in the red hot app-enabled domestic bike-sharing market, Ofo is backed by Chinese car-hailing giant Didi Chuxing in which Apple made a rare investment of US$1 billion in May 2016.

Cook described the investment in Didi as “a chance to learn more about certain segments of the China market”.

Neither Apple nor Ofo revealed the purpose of the visit, so it is unknown whether Apple is interested in directly investing in the business, which is battling with Tencent-backed Mobike in gaining a dominant share in the fledgling but rapidly growing sector.

“There is potential for cooperation between Ofo and Apple. For example, Apple Watch can be used to record and share the exercising data when riding a bike,” said Wang Xiaofeng, senior analyst with Forrester Research.

Cook’s visit comes three weeks after Ofo announced a US$450 million investment round from investors including from Didi Chuxing, MatrixPartners China and Citic Private Equity, which together brings the valuation of the three-year-old company to more than US$1 billion.

The company is tussling for funds with biggest rival Mobike, which said in February that its funding in 2017 totaled US$ 300 million.

Russia’s Digital Sky Tech leads US$450m funding round for China bike-sharing start-up Ofo

Initially a campus-based bike-sharing project, Ofo already has an operation in Silicon Valley and London as it looks abroad to further grow its business. On Tuesday, it announced its daily orders in China for bike renting has exceeded 10 million.

“Thanks for welcoming me today, Ofo team! Great energy behind your mission to make commuting greener, more efficient and fun!” Cook wrote on Tuesday in a post on Weibo, the Chinese version of Twitter.

He spent an hour at the company’s Beijing offices and tried riding the company’s signature yellow bike, accompanied by Ofo CEO David Dai, according to photos posted by Ofo employees on their WeChat Moments, a widely used social networking tool in China run by Tencent.

The visit is only part of Cook’s latest China tour.

On Saturday, he also took part in the high-profile 2017 China Development Forum, discussing the future of some key technologies, such as virtual reality and augmented reality.

Without a clear business model yet, dozens of bike-sharing firms have mushroomed in China as venture capitalists bet on the app-enabled services to become the next big thing in China’s booming sharing economy.

Both Ofo and Mobike claims to be number one in the domestic market.

Both companies have also set their eyes on further overseas growth. Mobike said on Tuesday it has now kicked off its Singapore operation.

The two companies have been showering the money they raised to offer free bike rides in recent weeks in an effort to gain market share.

business-article-page