While Ofo shuts down its operations just after few months of launch, Indian startups are growing steadily with intelligent strategies and better understanding of the sector. Localisation is the key.
Within just seven months of its launch, Chinese bike rental giant Ofo has shut down its India operations. The company fired most of its 30 employee team in India. The formal exit is expected to take a couple of months, according to reports.
Director, Public Policy and Communications at Ofo, Rajarshi Sahai told media that the company is shutting down their country operation as part of the company’s global strategy to shrink the footprint. He claimed that Ofo has completed about 1 million rides in the country in 10 weeks of operations across 7 cities. While leaving India on a positive note, Sahai wished other players in the sector to positively grow. “The move does not mean that the country has no potential in the segment. Even though it is a difficult market, the business model has huge potential,” Sahai added.
Reportedly, Ofo will also shut down its operations in a few other countries including Australia. The company raised $866 million from Alibaba Group in March this year. Although the shutting down is due to an unexpected cash crunch in the company. Part of the fresh investment was expected to be used to expand the India operations.
Ofo’s exit gives other dockless bike aggregators an opportunity of expansion. Another bike rental giant, Mobike had announced its launch in India in May this year. While international companies are trying hard to grow, Indian startups are doing well in the sector. Akash Gupta’s Mobycy has been gaining lot of positive attention and is speedily growing in the country. Cab aggregator Ola also came up with ‘Ola Pedal” its new bike-sharing venture. Understanding the market better, local startups are expected to take over very soon.