oBike in S’pore a lousy business that lost S$4.25 million in a year
Talk about being crap.
The details presented make it clear oBike’s business proposition ranged from poor to non-existent — and yet still managed to raise US$45 million in funding.
Cash flow problems within one year
Launched in Singapore in January 2017, oBike has been having cash flow problems since beginning of 2018 — one year into business here.
It ran up losses of more than S$4.25 million for the financial year that ended Dec. 31, 2017, as it brought in only S$912,668 in revenue.
Could not pay for services
It also owed various service providers money.
One of these service providers is Ruder Finn, a public relations agency in Singapore. oBike owes it several months of fees.
oBike had engaged Ruder Finn’s services in September 2017, but the contract has been “put on hold due to payment issues”.
Another company that is owed money is a logistics partner hired by oBike to round up indiscriminately-parked bicycles.
It also suspended its services this year when it hadn’t been paid its fees.
oBike had told this partner that it was in talks for a merger or acquisition, and would pay up after that. Talks failed.
Lee Der-Horng, director of the NUS-LTA Transport Research Centre, said: “I will not be surprised if more operators are forced to step out of the small Singapore market. Their incomes are pathetic. Whatever fees they collect are far less than their expenses.”
No talk of S$49 refunds for users
So far, talk in Singapore has not extended to the possible legal or criminal ramifications.
But one oBike co-founder, Edward Chen, has deflected queries to its Singapore-based team and lawyers, when pressed about users seeking refunds.
Chen said there was an “existing plan for the whole (liquidation) process”, but declined to elaborate.
The Consumers Association of Singapore (Case) president Lim Biow Chuan said: “These are not small sums if you add up the number of users. It comes up to quite a bit.”
oBike ex-employees in the dark
How bad the company was doing was apparently opaque even to oBike’s Singapore-based employees.
They did not have access to the company’s finances, which were managed from China by Chen and fellow co-founder Shi Yi, who is regarded as the real founder.
Trouble was brewing when two managers overseeing oBike’s operations in Singapore had left the firm in the past year.
One of them is Elgin Ee, its former general manager. He departed the firm last year.
Tim Phang took over, but left earlier this year.
The Singapore office handled areas such as operations, marketing, business development and government relations.
Other employees named
Others involved in oBike include Singapore citizen Zhu Yimin, who was listed as oBike’s director here, and Chinese national Wu Lijuan, who was listed as its secretary.
Zhu was overseas when Today visited her Senja Road home in Bukit Panjang, while Wu’s Gateway East address in Beach Road is the premises of secretarial firm CS Accounting & Tax Services, which helped oBike incorporate its business here in November 2016.
oBike had apparently stopped using its services last year.