Ofo, China’s largest bike-sharing company, is expanding into Japan in cooperation with SoftBank, which Reuters has reported will back the venture to the tune of US$1 billion.
The company will initially bring its signature yellow bikes to Tokyo and Osaka in September this year and then expects a wider roll out across the country.
The tie-up is with Japan’s SoftBank Commerce and Service, its division handling mobile device accessories- and information technology-related financing.
Japan is Ofo’s seventh overseas venture, after already expanding into Singapore, the United States, Britain, Kazakhstan, Thailand and Malaysia.
It is seeking the fresh capital less than a month after raising more than US$700 million from investors led by Alibaba Group and two others, following rival Mobike, which in June announced a US$600 million investment led by Tencent Holdings.
“SoftBank C&S has an impressive track record for technology innovation and capturing market trends. This partnership will pave the way for Ofo’s business growth and transformation, enabling us to better cater to our users’ needs in Japan,” said Lawrence Cao, head of its APAC business.
“Launching in Japan is a huge milestone, in a country where there is a strong cycling culture. We will strive to further improve the convenience and cost-effectiveness that cycling can bring to people there,” he added.
Tetsuo Kuramitsu, a director at SoftBank C&S, said it was delighted to work with Ofo to offer “an efficient and green transport solution that will generate convenience and contribute to environmental sustainability in Japan”.
China’s bigger bike-sharing companies are starting to aggressively expand overseas after major domestic success over the past year.
Mobike, a Tencent-backed bike-sharing firm, launched in Italy last month and is already offering its services in Singapore, Britain and Japan.
Official Chinese figures have claimed that 106 million people in the country were using mobile apps to rent bikes, as of the end of June.
Ofo claims to operate around eight million shared bikes globally, and registered three billion rides by customers in more than 170 cities.
It aims to operate 20 million bikes in 20 countries covering 200 cities by the end of this year, while Mobike targets to more than triple its coverage to 100 cities.
The overcrowded bike-sharing market – which really only gained pace in the past 12 months – has, however, already suffered its first failures among the more than 30 smartphone-based sharing apps to have launched.
Wukong Bicycle closed after just a five months in June, followed swiftly by 3Vbike, which was mainly offering its services in third-tier cities. The latter blamed its demise on having had most of its bikes stolen.
Ting ting, a Nanjiang-based bike-sharing service provider has also reported it is in difficulties, changing its management after customers complained they could not withdraw deposits using the app.
Source: South China Morning Post