How does the small blue cool ride collapse and the economic model of the sharing era is exactly what?
It seems that the prediction made by a shared bicycle founder eventually came true in the winter of 2017. However, this "elimination" appeared to be too rapid and intense, with one company after another collapsing, leaving no one willing or able to rescue them. As spectators, we watched the entire process unfold—from birth, to illness, to attempted treatment, and finally to death. Behind the so-called "sharing economy" bubble, who is truly at fault?
Recently, the "little blue bike" fell, its founder fled, employees cried, and users were angry. What happened to us? The story of the little blue bike is not just a single case—it’s a reflection of a broader trend.
There are more and more signs that the "cool bike" may soon follow in the same footsteps. As early as mid-August this year, many users across the country reported that they couldn’t get their deposits back within the promised seven days. Some even waited for over a month without success, while customer service lines remained unreachable. This situation is eerily similar to what happened with the "golden bike" just five months ago.
By September, these problems had only worsened, and media outlets began reporting on the chaos. In cities like Hangzhou, Hefei, and Changsha, bike stations were abandoned, with bikes left scattered and unused. By October and November, negative reports about Cool Bike continued to surface. On the first two days of the month, Cool Bike announced the closure of its Beijing Tongzhou Wanda Plaza office for deposit refunds. Users were instructed to visit Room 708, Building 1, Ocean Center, No. 588, Jitai Road, High-tech Zone, Chengdu, Sichuan, with valid documents such as ID cards or passports.
However, even after this announcement, many users found that the refund centers were still not operating properly. Some even traveled long distances to claim their deposits, only to be disappointed. One user joked: “I bought a plane ticket and ran all the way to Sichuan just to return my deposit—only to find out it wasn’t returned, and I got nothing but a meal.â€
The development of the shared bicycle industry can be divided into three main phases. The first phase began in May last year when Mobike entered Beijing. Soon after, ofo secured a $130 million Series C funding round and expanded beyond campus, entering the city market and directly competing with Mobike.
In a short period, billions of investment from venture capital and internet giants flooded into the industry, sparking a fierce competition fueled by heavy subsidies. The second stage saw the rise of multiple players—Yubai, Xiaoming, and others—each offering different colored bikes. However, the lack of regulation led to issues like over-supply, vehicle breakdowns, and cheating.
By the middle of this year, the third phase began, with many startups struggling due to insufficient funds. Mergers, acquisitions, and production halts became common as companies failed to sustain themselves financially.
Despite the collapse of some companies, the aftermath continues to affect users. Unlike taxi apps, which either failed due to unsustainable user growth or struggled to find a profitable model, shared bicycles faced similar challenges. The reliance on subsidies made it difficult to build a sustainable business model.
In my previous article, I highlighted that high frequency and necessity are essential elements of the sharing economy. The core assets of shared bikes aren't just the physical bicycles but also the user experience and service quality. As the market matures, cost efficiency and user satisfaction become key factors.
The issue of user deposits, as seen with Cool Bike, remains unresolved. A simple RMB 100 deposit becomes a huge burden for users. As Li Junhui of Titanium Media once pointed out, simply placing bikes without proper maintenance and management is a form of fund-raising fraud. This behavior is not only unethical but also potentially illegal.
If a business fails, it's often due to poor strategy. But was the initial approach wrong? Under the era of "wild growth" in the new internet economy, lack of autonomy, self-regulation, and government oversight created a breeding ground for problems.
Wang Xing, founder of the US group, once said, "Entrepreneurship is the relentless pursuit of opportunities regardless of available resources." Now, in today’s hot entrepreneurial climate, who can truly be called an entrepreneur?
Self-reflection is necessary: Why did shared bikes go from birth to death so quickly? Beyond the rapid capital burn, it’s because the internet industry has moved into a planned economy era dominated by a few big players. Entrepreneurs, from the start, focused on how to gain approval from BAT (Baidu, Alibaba, Tencent).
According to the "Statistical Report on the Development of China's Internet Network," as of June 2017, the number of shared bike users reached 106 million. With an average deposit of over 100 yuan per user, the total deposit in the shared bike industry could exceed 10 billion yuan. Adding shared cars and other items, the total deposit in the entire sharing economy might reach around 15 billion. Industry experts estimate that in the past six months alone, the sharing economy lost about 1.5 billion yuan in deposits, causing real economic losses to users.
At the end of the article, the author poses a question: In the next year, two years, or even five years, how will we deal with the 299, 199, or 99 yuan deposit? It doesn’t matter how small the amount is; what matters is the economic model of the sharing era.
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