China’s biggest cab hailing app, Didi Kuaidi, has today announced closure of a staggering $2 Billion funding round from investors including Ping An Ventures and Capital International Private Equity Fund. And the fund-raising isn’t just stopping as yet. The firm, which now has over $3.5 Billion in cash reserves, is looking to raise “few hundred million dollars” more from a set of global investors.
As for valuation, well it still stands to less than a third of rival Uber, to the north of $15 Billion, sources told Reuters. Uber is already valued at $50 Billion plus, and is looking to invest as much as $1 Billion to increase its market share in world’s second largest economy, a market dominated massively by Didi Kuaidi.
Didi Kuaidi will stay focused on the Chinese market, and will further increase its carpooling, shuttle bus and luxury cab services. A global expansion as of now, is off the cards, and rightly so considering it has a big American rival Uber, functioning on their home turf.
In an interview via phone to Bloomberg, Didi’s President Jean Liu said,
There are a lot of very valuable investors who still want to come in, and we like their brands and value-add. We will be very focused in the China market, we will spend heavily on R&D, on big data, and also on how to enlarge our market.
Talking about his company’s plans on using this huge cash influx, Liu told Reuters,
There are a few things we’re expanding into right now to establish our leading position in the full service transportation platform worldwide.
While a “full service transportation platform” hints towards expansion of its shuttle bus, chauffeur services, such gargantuan cash pile is more of a war chest to fight off Uber, than just expansion. In fact, it was Uber’s entry into the Chinese market, which indirectly forced Didi and Kuaidi, two of China’s biggest cab hailing services to unite to fight off Uber.
Other investors in this round include Coatue Management and previous investors Alibaba Group Holding Ltd., Tencent Holdings Ltd. and Temasek Holdings Pte.