Ofo Obtains RMB 1.77 billion Financing from Alibaba

According to a March 4 report in China's Economic-Weekly, ofo founder Dai Wei has obtained RMB 1.77 billion in financing from Alibaba via two rounds of chattel mortgages. The first mortgage was completed on February 5, 2018 and employed 4.4 million bicycles in the Beijing, Shanghai, Guangzhou, and Shenzhen areas as assets; the bicycles were mortgaged to the Shanghai Yunxin Venture Capital Co., Ltd. for RMB 500 million in creditor's rights. The second mortgage was completed on February 12, 2018 and employed a floating quantity of shared bicycles as the mortgaged assets; the bicycles were mortgaged to the Zhejiang Tmall Technology Co., Ltd. for RMB 1.26 billion in creditor's rights. Both of these two companies are members of the Alibaba Group. After a first round of reshuffling, apart from ofo, China's shared bicycle leaders also include Mobike, HelloBike, and DiDi, and all of these companies are vigorously exporting their models to international markets. In order to overcome the deadlock and gain victory in the shared bicycle market, shared bicycle providers must seek effective methods of maintaining profitability, and the second round of competition is expected to be even tougher.