Wheels Of Fortune

Can china’s Ofo export its bicycle-sharing scheme to a car-loving America?

- Biz Carson

A van pulls up to a warehouse on the south side of Seattle, unloading yellow bikes and placing them in a repair line. It looks nothing like the bicycle graveyards found outside repair shops in China, where thousands of bikes lie abandoned and rusting, but the same company logo appears: Ofo.

Four-year-old Ofo was a pioneer in dockless bike sharing, in which bikes don’t lock to a station but have electronic locks on the tires that click open with the scan of a barcode. That means anyone can ride a bike anywhere and leave it there for the next person to pick up.

The Beijing-based company has 15 million bikes across the globe and an estimated valuation of $3 billion, according to PitchBook. Ofo raised $866 million in an Alibaba-led funding round in March, a month before Mobike, its rival in China, sold to Meituan-Dianping for $2.7 billion.

Ofo’s early start, though, won’t enable it to coast to success in North America. There will be plenty of homegrown competitors to fight off after investment in U.S. bike-sharing and scooter-sharing companies topped $260 million in the first five months of 2018, according to PitchBook.

There’s another problem. Americans love their cars as much as the Chinese love their bikes. “The cities are built in a way where it’s car-friendly and it’s not bike-friendly,” admits Yanqi Zhang, 32, a co-founder of Ofo. “It did not look very straightforward that we could do any bike business.”