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Bluegogo CEO announces sale of company, admits to management mistakes in open letter
Founder of Bluegogo, Li Gang authored an open letter on November 16th stating that the Bluegogo has reached a strategic cooperation with Chengdu-based Green Bike-Transit (拜客出行). Green Bike-Transit will be fully authorized to operate the Bluegogo.
About the unpaid salary to Bluegogo employees, Li Gang also said, “Owing to everyone’s salary, I will try my best to solve it as soon as possible.”
Li Gang is not only the co-founder of Bluegogo but also the founder of SpeedX (野兽骑行). After Li Gang’s first smart performance bike SpeedX received RMB 150 million series B funding in November 2016, Gang established bike rental startup Bluegogo.
TechNode interviewed with Li Gang last year May when he was fully focused on SpeedX’s development. After setting the record for the most highly-funded bike on Kickstarter’s crowdfunding website, Gang was the first one to mention ‘bike innovation’ from China and was optimistic about Chinese bike’s global expansion. There was zero coverage about ofo and Mobike at that time, and after few months, China indeed made noise with its bike rental companies going global. However, the bike innovation story for Li Gang himself now stops here, as he admits his mistakes in managing the troubled bike company.
“I never denied my mistake. My heart is full of suffering and I am in trouble for months,” Li Gang said in the letter.
From June, Bluegogo has gone through a handful of problems, where Li Gang puts in his letter as “it seemed as if the Bluegogo was cursed.” Both Bluegogo and SpeedX had deteriorating financial positions, and the orders have been delayed. At present, Bluegogo has reportedly defaulted property costs up to RMB 200 million and owes nearly RMB 200 million from more than 70 suppliers. Most Bluegogo and SpeedX employees have left the company.
Bluegogo ranked 6th among the top 10 bike rental startup list by Cheetah big data and belonged to iResearch’s second tier bike rental company along with Hellobike and Youon, as they come in with an average Monthly Active Users number of more than 100 million.
In January this year, Bluegogo completed a RMB 400 million Series A, valued at RMB 1 billion. But since then, financing information has not been announced. The company is about to complete Series B in March, but did not get any sum of money in the end.
As Green Bike-Transit takes over Bluegogo’s operations, China’s bike rental market is witnessing consolidations. Previously, Hellobike and Youon bike merged to survive in the China’s bike rental red ocean. Wukong bike (悟空单车) and 3Vbike have halted its operation, while Machi-cho bike (町町单车) failed to refund the deposit.