The booming bike-sharing economy brings bicycles of every color on to China’s cities and offers city residents a new commuting option aside from walking and taking a bus. Zeebike, based in eastern China city Wuxi, joins the transportation sharing race with what is already very popular in the country: e-scooters.
China’s e-scooter companies produced 36 million vehicles in 2014 and 33 million vehicles in 2015, according to the National Bureau of Statistics.
China’s consumers and the sharing economy
Zeebike, founded in September 2016, enables its users to ride an e-scooter by simply renting one via its app. It is one of the latest business models that is referred to as part of China’s “sharing economy”. Strictly speaking, sharing economy usually refers to peer-to-peer based sharing access to goods and services – just like how Airbnb and Uber provide services for its users. However, for Zeebike users, they rent e-scooters from the company on a temporary basis.
“China’s manufacturers are facing the problem of excess capacity. The sharing economy enables companies to provide cheaper products or services that can better meet consumer demand,” said Yan Zhengsheng, co-founder of Zeebike, in an interview with AllChinaTech last week.
Starting from college campuses
Similar to bike-sharing giant ofo, Zeebike started its business from university campuses. Users can rent an e-scooter at RMB 1 (USD 0.15) per 15 minutes after paying a RMB 99 deposit. Once the ride is completed, it requires the user to lock the e-scooter within campus grounds or outside near the campus.
The reason for starting its business in college campuses is because a campus is a relatively small and limited region. The costs to manage shared e-scooters inside university campuses are much lower than managing e-scooters in the entire city as transporting scooters over wider areas are more expensive. On top of that, students are less likely to vandalize e-scooters than the average user.
Zeebike’s expansion is different from that of ofo which launches new bikes on its own. Zeebike partners with local agents that purchase e-scooters from Zeebike and thereafter manage e-scooter rentals on their own. These agents need to give 10 percent of total profit to Zeebike for app maintenance fees.
As of early May, Zeebike has launched e-scooters in more than 70 universities in 13 cities, and attracted over 100,000 users.
So far, the company only provides e-scooter rental services inside campuses. However, its ambition is more than just that.
“We aim to launch more than 100,000 e-scooters in 30 cities by the end of this year. We will also put our e-scooters on the roads of 10 of these cities” said Yan.
A team from the e-scooter business
The founding team is from the e-scooter business, and according to Yan, the startup did a lot of work to ensure that its supply chain for e-scooter manufacturing works well. The team has the best cloud monitoring technologies in the industry, and allows users to rent an e-scooter conveniently.
On top of that, its e-scooter factory meets the requirements of China’s subsidy policies for clean energy, and thus receives subsidies.
In terms of financing, the startup has raised RMB 10 million from Xinger, a local enterprise resource planning software provider.
“We will invest in R&D to make smarter e-scooters that can gain better recognition from users. In future, we’ll give updates on our products,” said Yan.
(Top photo from Zeebike)