Bike-share companies, among the hottest startups, are wiping out investors.
“It now appears bike sharing is the stupidest business, but the smartest brains of China all tried to get in,” Wu Shenghua, founder of 3Vbike, one of the many collapsed bike-sharing companies in China, told Reuters. “It really now seems ridiculous.”
Afterwards, a lot of the ingenious must-not-question stuff that happened during a bubble is considered “ridiculous.”
Bike-sharing companies are just an example. With their capital-intensive, cash-burning, ride-subsidizing business model, they were, in their short lifespan, among the hottest startups in China. They’ve attracted $2 billion in venture funding in 18 months of frenzy leading into 2017. Over 40 platforms mushroomed out of the ground.