Qingju, DiDi Chuxing's bike-sharing spin-off, has closed a USD 1 billion round of funding, according to Chinese tech media LatePost.
Qingju’s deal is led by Legend Capital and another overseas fund, which was also reportedly going to invest in HelloBike's latest round of funding, which closed in March.
Qingju is under the management of DiDi's two-wheeler business unit, the Community Mobility Group (CMG). Zhang Zhidong overlooks the division and reports to DiDi founder Cheng Wei directly.
We see the niche of bike-sharing is moving into a mature stage as more companies raise late-stage funding (Bird and Lime are in the Series D stage) and build mindshare.
In China, the industry has seen significant ups and downs in the past few years. During 2015 and 2016, hot money flew to startups, pushing them to scale fast and gain market share (also known as blitzscaling). With the collapse of ofo in early 2019, the industry entered into a cooling stage. It began to embrace more innovations in hardware (say, smart locks) as well as intelligent planning systems to match demand and supply in a better way.
HelloBike, for instance, has around half of its employees (1,000) in the R&D department to improve operational efficiency. It now ranks no. 1 in terms of order volume, followed by DiDi's Qingju and Meituan, according to LatePost.
HelloBike, which provides bicycle-sharing as well as ride-hailing services, has 15 million monthly annual users (MAUs) according to Chinese data tracker Analysys. The company also proved its ability to make profits – it earned profits in more than half of the cities it operated in in 2019. In certain months of 2019, the company as a whole made profits, according to the company cofounder Li Kaizhu.
Whether Qingju will succeed in this battlefield of bike-sharing, e-scooter sharing and even battery swapping business is uncertain now, for pouring out money is not a meaningful strategy any more now, in the ‘second half’ of the game.