Dockless bike-sharing has exploded in just a couple of years, spreading to dozens of Chinese cities seemingly overnight. The incredible growth was fueled by a massive injection of venture capital, creating two startup unicorns in less than two years: Ofo, a three-year old dockless bike sharing company, had raised over $1.2 billion USD, and Mobike, which pulled more than $900 million in venture capital.
In that same time, no less than 40 bike-sharing companies have popped up, creating a bizarre picture in major Chinese cities of ride-sharing bikes left in heaps of colorful piles. According to Xinhua news agency, more than two million bikes were available for sharing from 15 companies in Beijing alone, creating a burden for municipalities in China that were struggling to contain the explosive growth in a new industry.
Now, dockless bike-sharing is spreading to other countries. Both Ofo and Mobike are expanding aggressively abroad, launching in Japan, Singapore, Europe and North America. In July, Ofo claimed to have 6.5 million bikes in its global network. The scale and potential market of large cities attract companies to deploy their fleet. Dozens more startups are now on their path to implode, as competition is playing winner-takes-all strategy and leaving even players as large as Bluegogo was broken and devastated. And with a bigger threat looming over — if the merger of Ofo and Mobike happens next year — it will mark the end of life for many smaller players.
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