Bike No More
Everything nowadays is an “Uber for X”. You can rent homes, taxis, boats, rental cars, and more at the press of an app. As part of this X-sharing craze, companies everywhere are raising huge amounts of money for the next iteration. While some companies like Airbnb have turned out alright as a result, a few other have floundered...massively.
Meet Wukong Bicycle. People bike everywhere in China, and Wukong figured why should people own a bike if they can just rent one?
Lei Houyi is the founder of Wukong Bicycle, and he had a simple dream — bring bicycling to the masses of China.
One problem facing Lei was that there were countless other bike sharing startups already in China when he started his businesses. China currently has >30 bikesharing startups. Among those are companies like Ofo, the current leader in China which is valued at over 1 billion US dollars and gets 20 million rides a day.
This didn’t phase Lei though. He would start local in his town of Chongqing, and believed he could grow the business to be national and compete with players like Ofo.
“I was eyeing a national market,” Lei said in a phone interview with the South China Morning Post. “I truly believed that there was a window for me to expand my business from Chongqing into the rest of China.”
With 300,000 of initial capital, and a team of 20, Lei worked tirelessly to launch his service in Chongqing before Ofo launched in the city.
But, Lei had a secondary problem, which he evidently didn’t think was a problem at first. Unlike most (aka all) bike-sharing startups in China, Wukong Bicycle decided not to put GPS trackers on their bikes.
The result of this is exactly what you might expect — within a few months of starting, 90% of all of Wukong’s bike inventory had been stolen, and they had absolutely no way of tracking it whatsoever.
This led Wukong to close down this summer, becoming the first of the 30 chinese bike sharing companies to declare bankruptcy. Lesson learned. Before you loan things to people — make sure you can keep track of them.
