Chinese Internet giant Tencent Holdings Ltd. and Warburg Pincus have led a US$215 million series D funding round in Mobike, a Chinese smart bike-sharing company.
New strategic investors including China’s largest travel company Ctrip, TPG, and Chinese hotel operator Huazhu Hotels Group, as well as existing investors Sequoia Capital China and Hillhouse Capital also participated.
The round follows a US$100 million capital injection in the company from Hillhouse Capital, Warburg Pincus, Sequoia Capital, Qiming Venture Partners, Tencent, Bertelsmann Asia Investments, Joy Capital, Panda Capital and others in October 2016.
Mobike’s rival, Beijing-based ofo, secured US$130 million in series C financing round led by CITIC Private Equity, Coatue Management and Xiaomi Inc. around the same time three months ago. Chinese ride share giant Didi Chuxing also invested tens of millions U.S. dollars in ofo.
For Mobike’s latest round, Tencent is investing as a strategic investor, and plans to bring resources to support Mobike’s mission of bringing bikes back to cities, the company said without elaborating.
“Our investment in Mobike demonstrates our commitment to supporting the development of the sharing economy and smart cities in China,” said Pony Ma, chairman and chief executive officer of Tencent. “Mobike has an excellent leadership team and the leading technology in their industry. We hope that by combining this with Tencent’s deep understanding of user behavior in China, we will create unique value for our users in their daily transportation.”
Mobike said it would work with new investors, travel firm Ctrip and hotel operator Huazhu Hotels Group, to unlock new growth opportunities and enable more travelers to get around cities more easily.
The bike sharing company began trial operations in Shanghai at the end of 2015 and officially launched its smart bike sharing service in Shanghai in April 2016. It has now expanded into nine cities across China.
The specially designed Mobikes are equipped with GPS and smart-lock technology, which enables users to easily find a bike nearby anytime, anywhere using the Mobike smartphone app, and to unlock the bike using their phone.
After reaching their destination, the user parks the bike at a suitable spot along the roadside and returns it by simply closing the lock, making the bike immediately available to other users nearby. Payment is automatically calculated and deducted from the user’s Mobike account.
Mobike and other so-called bike sharing companies in China, which operate in similar ways, are therefore not exactly part of the “sharing economy,” as users are not sharing their bikes with others. Instead, the companies are providing the bikes on their own to users directly, making Mobike and its peers more like technology-enabled bike rental companies.
