CITIC PE leads Series C for China taxi booking app - report
CITIC Private Equity has reportedly led a Series C round of funding worth up to $100 million for Didi Dache, a Chinese taxi booking app. Existing investor Tencent is also among the participants.
According to news site Tencent Tech, Didi has received $60 million from CITIC PE and $30 million from Tencent. Last year the domestic internet giant committed $15 million to the company, while GSR Ventures contributed $3 million in an earlier round.
Didi connects prospective passengers with vacant taxis. The passenger requests a taxi via the app and has the option of adding a discretionary tip to incentivize the driver. Rival services include Kuaidi Dache - which is backed by Alibaba Group and allows passengers to make payments through Alipay - Yaoyao Zhaoche and Dache Xiaomi.
Taxi booking apps first appeared in China at the beginning of 2012, according to iResearch and there were nearly 100 in operation as of October 2013. Didi and Kuidi rank first and second in the market, with more than 5 million registered users apiece.
Taxi booking apps were receiving 340,000 orders per day from major cities including Beijing, Shanghai, Hangzhou and Guangzhou as of August 2013. Didi accounted for 59.4% of orders. The company covers 32 cities with 70% of its bookings coming from eight major cities.
IResearch projects that overall users of taxi booking apps numbered 18 million at the end of 2013 and will reach 30 million by the end of this year. There is anecdotal evidence of intense competition in the market with larger providers subsidizing drivers to use their services, thereby eroding profit margins.
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