Yet another bike-sharing startup is finding itself in some serious trouble, discovering that there may not be as big of a market in China for glittering, gaudy “tuhao gold” bicycles as they had originally thought.
Cool Qi Bike (酷骑单车) was once positioned as China’s third most popular shared bike app, owning some 1.4 million bicycles in major cities around the country. In addition to its ordinary green bicycles, in June, the company infamously introduced a new (and more expensive) line of gold-painted shared bikes to the sidewalks and streets of China, which boasted onboard phone chargers courtesy of Chinese electronics giant Haier.
However, despite receiving nearly a billion yuan in investment and counting 1.5 million registered users, the company has recently run into some severe financial problems.
Photos went viral on Weibo yesterday showing angry customers storming Cool Qi’s headquarters in Beijing’s Tongzhou District, demanding a refund for the 298 yuan deposit they paid after hearing rumors and reports about the company letting go and laying off workers. In the photos, the company’s offices are eerily empty of employees.
Last week, the company sent out a notice to employees, telling them that they must decide before the end of the month if they want to stay with the company “live or die” or leave and find another job, warning them that after September 31st their paychecks may start to arrive late.
Following these reports, Cool Qi founder Gao Weiwei revealed to the Chinese edition of Tech Node that he had been removed as the company’s CEO, but insisted that his company was not bankrupt, though he admitted it was facing some rather serious difficulties. Gao said that the company had 40 million yuan to use to refund customers’ down-payments, but that WeChat had blocked its payments account.
Gao also added that Cool Qi was currently negotiating an acquisition deal with another company that could save them from financial ruin and provide them with as much as 1 billion yuan in capital.
If Cool Qi is unable to negotiate a deal, it could soon be the latest (and largest) casualty of China’s bike-sharing explosion. Earlier this year, a pair of shared bike startups made headlines for going out of business only a few months after starting up after most of their bicycles were stolen.
Meanwhile, China’s two leading shared bike apps, Mobike and Ofo, have been busy expanding their services abroad to places like London, Washington DC and Phuket, while, at the same time, tens of thousands of their bikes are being confiscated by authorities in China for being illegally parked on the sidewalk or street, and left to rot away in vibrant vacant lots.
In this business, that’s what winning looks like.
[Images via @北京人不知道的北京事儿]
Follow Shanghaiist on WeChat