From bike sharing to ICOs: 3 cool things I learned from Techcrunch Shenzhen
From VR robotic arms to lighting fast facial recognition software, Techcrunch Shenzhen 2017 did not disappoint in the breadth of cutting edge Chinese tech start ups present. I went into the conference with a rather shallow understanding of the the tech ecosystem in China, and left astonished by the massive scale and speed of what’s happening here. Here are the three most interesting things I learned:
Mobike takes bike sharing to the international stage
CTO of Mobike, Joe Xia
Mobike is a fully dockless bike sharing bike sharing system. Within the past few years, their bikes have become ubiquitous in most Chinese cities.
Some of the numbers Xia revealed in his talk were pretty staggering. Mobike currently has 5 million bikes in 100 cities, 100 million users, 25 million trips at peak times (which is more than Uber or Didi peak time trips), with 40% of the trips booked through their Wechat mini app. You might ask, don’t they get nervous that so much of their business is at the mercy of Wechat? Maybe not since, full disclosure, they just casually raised $600M USD through Tencent (parent company of Wechat) last week to expand internationally, pushing them pass Ofo to have raised the most venture capital of any bike sharing company…ever.
Xia spoke at length about giving users “hongbao”, or digital red envelopes of cash, a way to improve efficiency in the bike network systems. Since Mobike is dockless, users often leave their bikes in remote areas, making it hard for them to be found by other users. Mobike is incentivizing users with cash rewards for moving bikes from low traffic to high traffic area, or finding “lost bikes”, with the cash gift of 1 to 100 yuan per “task”.
Anyways, if you’re basically going to pay your users to use your product and you’re renting bikes out for the low, low price of .5 yuan for 30 minutes (essentially 15 cents an hour), it’s probably a good idea to supplement your revenue with other sources. Xia mentions other revenue streams, including catering to businesses who use their bikes for deliveries, building a global IoT platform that include other services, and the possibilities of one day selling the massive troves of commuting data they have on their users.
Takeaway: Mobike is heralded as a darling of the Chinese tech world for being one the first big original start ups ideas to come out of China, which makes me keen to keep an eye on their international expansion and whether the international communities beyond China will be receptive to bike sharing. While I think Mobike is one of the most unique and fascinating start ups that have come out of China, their business model paints a picture of delayed profitability amidst a mounting global war of attrition between themselves and the gazillion of other bike sharing start ups in China and abroad, similar to what we saw between Didi and Uber in China.
Are ICOs the new VCs?
CEO of Kik, Ted Livingston
Kik is Canada-based anonymous chat app that’s hip with the young kids (you know, not me).
While they’ve raised $120M USD to date, Livingston talks about the difficulty of monetizing a chat app in the Western world when you don’t have as much advertising data as some of your larger competitors (ahem, Facebook). Thus, Kik will be offering a cryptocurrency called Kin that will be based on the economy within the Kik ecosystem in order to raise more money, and take pressure off of having to do either an acquisition or IPO. Kin can be used to pay users and developers for contributing to the ecosystem by doing tasks such as creating stickers or building bots and services for Kik.
While Livingston didn’t mention the exact date for the ICO, or “token distribution”, it will be sometimes this summer. If you’re interested in getting in on this, the breakdown for the ICO will be as follows:
10% sold in the Initial Coin Offering
30% retained by Kik
60% retained by Kin Foundation, a nonprofit that operates Kin
Takeaway: Prior to announcing Kin, Kik has actually been piloting a sort of micropayments system within its app called Kik Points for the past few years. Kik’s offering will be following a series of successful ICOs this year, although it will be the first ICO ever introduced by a social messaging app. Will it go down the rabbit hole along with Facebook Credits? Only time will tell.
Powerpacks and the sharing economy
with Yuan Yuan, CEO of Ankerbox
Ankerbox (whose name you might recognize from its parent company Anker, which produces those beautiful black little powerbanks) is a portable powerpack that you can rent from public places such as cafes and shopping malls.
While the design of the Ankerbox powerbank is a far cry from the sleek Anker units I currently own, the concept is indeed intriguing. They had a row of Ankerboxes at the conference, which you can rent for 1 RMB per hour and a 100 RMB deposit, using Alipay or Wechat Wallet on your phone. There could indeed be a lot of demand for a product like this. Yuan mentions that especially for men, who don’t carry purses, and don’t have space in their pockets for bulky powerpacks. Though like most trending things in China, Yuan admits speed to market is of utmost importance for the company right now, as Xiaodian and a host of other start ups have been jumping on this newest take on the sharing economy.
Takeaway: Similar to the issue with Mobike, while I could see the product being successful in China, where the high ubiquity of mobile payment through Wechat/Alipay enables almost anyone to pay for anything instantaneously through their smartphone, Ankerbox would face a larger adoption barrier in the US and other markets. While the service is available in Seattle, you have to first download their app, create an account, and input your credit card, which is a whole lot of hurdle to jump through when your phone battery is dying…which is why you would want to rent it in the first place, right?
Thanks for reading!