Didi Kuaidi is loading up the war chests.
Bloomberg reports that the Chinese ride-hailing app is in the middle of a fresh funding round as it battles Uber in China. The oversubscribed round has reportedly brought in “at least’ $1 billion, and values the company at more than $20 billion.
China’s high population makes the country an increasingly important market for Uber.
The American startup claims to be seeing stratospheric growth in trips in the country, and — unlike all other territories in which it operates — has formed a local unit (Uber China) to fundraise and drive growth. “We could have continued to run Uber as a part of Uber Global, but it was important for us to make it a Chinese company and get Chinese investors,” Kalanick explained. “Just like we have Chinese general managers operating and building the business, we should have Chinese shareholders as well.”
Five of Uber’s top 10 cities by ride count are now in China, and passengers in the country are now taking more than one million trips per day.
But it’s not a smooth ride — it faces stiff opposition from the established taxi industry, and its offices have been raided by Chinese authorities before.
Its biggest threat in the country is Didi Kuaidi, a Chinese company formed in February 2015 when two former competitors — Didi Dache and Kuaidi Dache — merged. Just last September, the Chinese company raised $3 billion at a $16.5 billion valuation. And now it’s doubling down.
Meanwhile, Uber is spending huge sums in the country. It’s losing more than a billion dollars every year in China, CEO Travis Kalanick revealed earlier this month.
“We have a fierce competitor that’s unprofitable in every city they exist in, but they’re buying up market share,” he said, referring to Didi Kuaidi. “I wish the world wasn’t that way.”
With Didi Kuaidi’s latest cash injection, it looks like the world will be that way for a little while longer.
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