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Uber rival said to raise funding goal to more than US$1.5b
[HONG KONG] Didi Kuaidi raised the target on its latest round of funding to more than US$1.5 billion, according to a person familiar with the matter, as China's largest ride-hailing service stockpiles cash for its battle with Uber Technologies Inc.
Uber's largest competitor will be valued at more than US$20 billion in the round, said the person, who asked not to be named because the matter is private.
The round will close soon and is multiple times over-subscribed, Vice President of Strategy Stephen Zhu said Thursday without naming a target or investors.
Didi needs capital to bankroll an aggressive driver- recruitment program and keep fare prices competitive as it strives to hold off a hard-charging Uber. The US startup, the world's most valuable, spent more than $1 billion in the country last year and has said China could eventually become its largest market.
"We believe we will be the last one standing," Mr Zhu told the Credit Suisse Asian Investment Conference in Hong Kong. The company will "soon" be profitable, he said without giving a timeframe.
Didi had been seeking to raise US$1 billion, a person familiar with the matter said in February.
The company's existing investors include Alibaba Group Holding Ltd and Tencent Holdings Ltd, China's two biggest Internet companies.
On-demand car services have taken off around the world as mobile usage expands and riders seek simpler or quicker alternatives to taxis and public transportation.
Yet Uber and its rivals can lose money on rides because they rely on subsidies to attract customers, especially as they enter new markets.
Didi raised US$3 billion last year, which valued it at US$16.5 billion, a person familiar with the matter said at the time.
The company formed an international coalition with Lyft Inc in the US, India's Ola and Southeast Asia's Grab to fight a globally expanding Uber.
Local regulations are one of the more significant potential hurdles that ride-hailing services grapple with.
Back home, Didi faces potential competition from a spate of local governments who're trying to set up their own ride-hailing services.
"When we have a competitor, a strong one, it drives the team so strongly to fight and to work hard," Mr Zhu said.