Hello Chuxing Leads China's Bike-Sharing Sector in Daily Orders, Founder Says
Lv Qian
DATE:  Jan 16 2019
/ SOURCE:  yicai
Hello Chuxing Leads China's Bike-Sharing Sector in Daily Orders, Founder Says Hello Chuxing Leads China's Bike-Sharing Sector in Daily Orders, Founder Says

(Yicai Global) Jan. 16 -- Hello Chuxing, formerly known as Hellobike, tops China's cycle sharing sector in terms of average daily order volume, according to the firm's founder.

The Shanghai-based firm's success in the sector stems from its efforts to avoid being drawn into a cash-burning battle with key opponents like Mobike Technology and Bikelock Technology's Ofo, founder Yang Lei told Yicai Global in an email.

Hellobike changed its name to Hello Chuxing last September as it entered a brand-new stage of development, transitioning from a bike-sharing service provider to a professional mobile transportation platform.

Standing Out From Rivals

The firm has differentiated itself amid fierce competition with user experience and fine-tuned operations that are driven by intelligent technologies, Yang said, adding that its consistent efforts to control costs have also helped.

With operations in more than 300 cities across the country, Hello Chuxing boasts average daily orders topping 20 million and more than 200 million registered users. The firm has facilitated 9.8 billion bike-shares to date, according to official statistics, and it has branched out into e-bike rentals and shuttle services at scenic spots.

Hello Chuxing completed a CNY4 billion (USD591 million) round of financing last month, led by Primavera Capital and Alibaba's fintech affiliate Ant Financial Services, to reach a valuation of at least USD2.5 billion. Ant Financial remains the company's biggest benefactor, an industry insider said.

Leaving Cash-Burning to Rivals

The recent tide of failure in the bike-sharing sector has called the viability of its business models into question along with companies' practice of burning through cash subsidies to keep up with rivals and to maintain a rapid pace of expansion. The market was too lavish when capital players and consumers were still generally optimistic about the sector, Yang said. Nevertheless, Hello Chuxing never followed its peers into the cash-burning battlefield.

Founded in 2016, the company started out in tier-two and tier-three cities where there was a significant lack of resources, he said, adding he kept the future direction of the company and the sector in mind while knowing that focusing on these difficult markets meant Hello Bike was up against it. The firm subsequently focused on how to spend every penny wisely while planning for the future, rather than resorting to cash-burning.

Hello Chuxing paid close attention to cash flow in the early stage and was cautious about every step it took with delicate management and detailed bookkeeping. The company's demand for capital contributions has not been as strong as those of peers, Yang emphasized when looking back on the history of its development. The firm has kept to its own strategy and driven itself forward through technological advancements and the creation of excellent user experience as opposed to short-term speculation.

Hello Chuxing is clear about the bike-sharing business model while improving its ability to grow independently and not live off user deposits, Yang noted.

The team focused on intelligent product positioning, ease of use and good quality products when starting out in the industry with a preliminary focus on tier-three and tier-four cities. Hello Chuxing has continuously rolled out precise bicycle management using smart technologies, Yang explained, adding that voice-activated locks and smart self-diagnosis functions have allowed the firm to boost user experience while reducing bike downtime. Hello Chuxing was the first player to attempt such innovation within the sector, he added.

The company will unavoidably face more challenges and difficulties as its transformation progresses, Yang said, adding that it will now focus on holding on to its core competencies and advantages. Hello Chuxing hopes to continuously improve the sector through technological measures, which involve high standards of operations and competitive products that will continue to be upgraded.

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Keywords:   Hellobike,Bike-Sharing