Bike-sharing company Mobike has managed to raise $1 billion in its latest fundraising round, Caixin Global reports, after talks of a merger with key competitor Ofo were abandoned.
The two companies are in a fierce struggle to gain control of the booming bike-sharing sector, employing various forms of price and non-price competition to retain customers. The business model allows bike riders to pay a small fee for access to a company’s bike inventory, which are scattered across the city and can be unlocked using an app.
Many big names in venture-capital and private-equity have been trying to grab a piece of the market, with companies such as Sequoia Capital and Hillhouse Capital sinking over $2 billion into Mobike and Ofo, whose valuations have accordingly skyrocketed.