After a false start, China sees its first bike-rental IPO

China’s burgeoning bike-rental industry has witnessed its first-ever IPO as Changzhou-based startup Youon went public today. Shares of Youon started trading this morning on Shanghai Stock Exchange at the initial offering price of RMB 26.85 ($4.02) per share.

Despite all the glory in bearing the title of the “first listed bike-rental firm in China”, Youon’s way towards IPO was bumpy with a series of twists and turns. After a failed application in 2015, the firm filed again for listing this March. But the IPO procedure took a halt two months later due to an IP infringement lawsuit filed against the company by Jiangsu business man Gu Tailai, who claims Youon did not have the authorization to use his dockless bike patent.

Founded in 2010, the company’s main business includes the sale of public bikes, the operation of a government-funded public bike rental platform (docking stations required), and that of dockless bike-rental services funded by private investors.

Strictly speaking, Youon is more about dock-based public bike business than the dockless bike-rental platform. An overwhelming 99.8 percent of its revenue comes from the sale (RMB 239 million) and operation (RMB 533 million) of public dock-based bicycles in 2016.

As of 2016, the firm operates public bike systems in over 400 cities, of which roughly half are tier-three and lower-rung cities. It now claims 20 million users and around 7.5 million are registered through Youon’s online platform.