Bike share might be slow in taking off in in Ottawa, but in other parts of the world it is serious business. There is currently a bit of showdown happening in China between the two main bike share behemoths in the bike share world: Ofo and Mobike.
The two largest Chinese bike share companies are looking to expand. Ofo just announced it will start a bike share system with 500 bikes in Cambridge, UK. In February 2017, Ofo raised no less than 450 million USD. It is also working on the introduction of bike shares in Silicon Valley and Singapore. The latter one just received 1000 bikes. The Chinese company’s bikes are currently available in 34 Chinese cities with 3 million bike riders a day. Ofo bikes can be left in any place, because they are enabled with smart technology. Tracking is enabled through GPS, and the bikes can be unlocked through a cell phone. I have seen a similar system by Deutsche Bahn (German Railways) in Munich a number of years ago, where you could leave your bike anywhere. ofo is backed by Didi and Xiaomi and has around 20 million users.
Ofo is not the only provider that thinks big. Mobike is another behemoth. Global Private equity company Warburg Pincus from New York has $ 44 billion in assets under management, invested in 140 companies. In January they closed another round of US$215 million Series D financing for Mobike to expand with partners such as Chinese internet giant Tencent, China’s largest travel company Ctrip (which also owns Skyscanner btw) , private equity firm TPG, China’s hotel operator Huazhu Hotels Group, Sequoia China and Hillhouse Capital. Mobike has 10 million users.
Wealth of data from bike share users
Such numbers give the owners a wealth of data. Think ads along busy bike routes or retail that can profit from bikes: bikes need little space to stop and park after all.
Bike shares are becoming an integral part of the shared economy. “Why own?”, many people appear to think. When I used a bike share in Vancouver last fall, while staying in an AirBNB apartment, I thought the same thing. But I can’t entirely figure out the business model yet.