After years of speculation, China’s top ride-hailing firm Didi Chuxing has finally unveiled its initial public offering (IPO) filing in the US, giving a glimpse into its money-losing history.
Didi did not reveal the amount of its raise. Reports suggested that the company could raise $10 billion at a valuation of close to $100 billion, however, The Wall Street Journal cited a valuation of $70 billion.
According to the prospectus, Mr. Cheng Wei, Didi’s 38-year-old founder, owns 7 percent of the company’s shares and controls 15.4 percent of its voting power before the IPO. Major shareholders to reap returns are Asia’s technology investment firms SoftBank Vision Fund, which owns 21.5 percent of the company, Uber with 12.8 percent, and Tencent at 6.8 percent.
The nine-year-old firm, which famously acquired Uber’s China operations in 2016, is now more than just a ride-hailing platform. It has a growing line of businesses like bike-sharing, grocery, intra-city freight, financial services for drivers, electric vehicles, and Level 4 robotaxis, which it describes as “the pinnacle of our design for future mobility” because of its potential to reduce costs and increase safety.
Didi established an autonomous driving subsidiary in May of last year, which received $500 million from SoftBank’s second Vision Fund.
Expanding business
Didi served 493 million annual active users in the year ending March and saw 41 million transactions daily. In Q1, it has 156 million monthly users, far more than Uber’s 98 million in this period.
Mobility services in China have consistently accounted for more than 90 percent of Didi’s revenue. The company has attempted to grow its footprint in a dozen overseas countries like Brazil, where it purchased the local ride-hailing company 99 Taxis.
Didi intends to invest 30 percent of its IPO proceeds in shared mobility, electric vehicles, autonomous driving, and other technology. 30 percent will go towards its international expansion while the remaining 20 percent will be utilized to develop new products.
