Ofo’s “Oops” Moment: The Bike‑Sharing Giant in a Cash‑Flow Crisis
In a shocking turn of events, the once‑glitzy bike‑sharing start‑up Ofo, with backing from Alibaba Group Holding Ltd, is reportedly staring down the barrel of bankruptcy. The Financial Times broke the news on Wednesday, pulling a leaking letter from founder Dai Wei to his team.
Why “a Big, Big Problem” Is the Buzzword
- “I’ve thought countless times … of even dissolving the company and applying for bankruptcy,” Dai Wei wrote in an emotional note.
- He added that the company has been under “immense cash‑flow pressure” all year round.
- Key stress‑points? Refunds to users, payments to suppliers, and – get this – turning every yuan into a tripled‑up deal just to keep the wheels turning.
Neither Ofo nor Alibaba has weighed in yet, but the story has sent a ripple through the Chinese bike‑sharing scene.
When Pipes Run Dry in the Urban Bike‑Race
China’s bike‑sharing wars have poured hundreds of millions of dollars into the battle for city domination. Bikes once spotted on every corner, now face a fiscal pothole that threatens to bring the entire fleet to a grinding halt.
The Twist: A Potential Upside
In August, Reuters reported that Didi Chuxing and Alibaba’s Ant Financial were negotiating a joint buyout of Ofo. That deal could tag the company at a cool $2 billion (about S$2.75 billion).
So, does Ofo ride into bankruptcy or glide toward a golden rescue? Only time will tell. Until then, brace yourself for more wobble on those bike‑sharing streets!