Dai Wei, Are You Running Away Again?
Yes, you read it right – the founder of Ofo, the yellow bike-sharing service with over 16 million users still waiting for deposit refunds, Dai Wei, is making headlines once again!
Do you remember the ubiquitous Ofo bikes on the streets?
Do you still have a deposit refund application in the queue?
Do you still hold a glimmer of hope?
Unfortunately, the man who once secured over 15 billion yuan in funding has faced another setback!
According to “Entrepreneur China” magazine, Dai Wei’s coffee venture in the U.S., named About Time Coffee, has dwindled to only one operational store, with the rest permanently closed.
The last tweet from About Time Coffee’s account dates back to September, and the latest customer post was from last year.
With 41 restrictions on spending, owing 1.6 billion yuan in deposits, Dai Wei ventured to the U.S. to invite people for coffee. However, it seems his second entrepreneurial attempt might end in failure!
Regrettably, over 16 million people are still waiting in line for Ofo deposit refunds. Even if each person’s deposit is calculated at 99 yuan, the total awaiting refund exceeds 1.6 billion yuan.
Dai Wei’s comeback seems challenging, and the question remains: Is there any hope for the refund of these over 1.6 billion yuan in deposits?
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Ofo Still Holds Over 1.6 Billion in Unrefunded Deposits; Founder Dai Wei Faces Another Failure in U.S. Entrepreneurship!
In the first half of this year, Dai Wei’s U.S. coffee venture, About Time Coffee, gained rapid popularity. The chain of small coffee shops, adorned with red neon signs, initially opened in Gramercy Park, New York, and quickly expanded with four additional stores in the bustling Manhattan city center.
However, the prosperity was short-lived!
According to “Entrepreneur China” magazine, only one About Time Coffee store on Madison Avenue, New York, remains open, while the other four have permanently closed.
After the failure of Ofo, Dai Wei, restricted from spending, fled to the U.S. and established About Time Coffee. The project, valued at 400 million dollars, raised over 10 million dollars in funding, including investments from IDG, ZhenFund, and Beijing Weilie Capital (early Ofo investor).
About Time Coffee’s pricing strategy, target consumer base, and marketing tactics all seemed familiar.
The initial subsidy approach of About Time Coffee even mimicked Luckin Coffee’s “burning money” strategy, relying on substantial subsidies to boost app downloads, sending promotional messages to users, and advertising at the coffee shop entrance with offers like “register on the app, and the first five cups are on us.”
However, there was no effective profit channel, making it challenging to sustain operations!
Moreover, faced with stiff competition from well-established coffee chains like Starbucks and Dunkin’ Donuts, About Time Coffee struggled to differentiate itself in the market.
According to foreign reports, the brand encountered a crisis at the end of May 2023, with a broken funding chain, leading to the forced closure of some stores.
The last tweet from About Time Coffee’s account was in September, and the latest customer post was from last year.
Now, with only one About Time Coffee store remaining, Dai Wei’s second attempt at entrepreneurship seems to have ended in failure!
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During the Ofo venture, Dai Wei tasted the sweetness of burning capital for expansion but stumbled due to a lack of profitability. Now, in his “second entrepreneurial” coffee project, Dai Wei appears to be stuck in the same logical loop.
Public records show that Dai Wei, born in 1991 in a well-off family in Anhui, moved to Beijing with his parents and entered Peking University at the age of 18. After graduating, he was successfully recommended for further study.
In 2014, Dai Wei co-founded Ofo with fellow Peking University alumni.
Subsequently, the company thrived in the wave of the sharing economy. Since its launch in June 2015, Ofo once connected over 10 million shared bicycles globally, with daily orders exceeding 32 million.
Data indicates that in 2016, Ofo held a 51.2% market share in the overall Chinese shared bike market, ranking first in the industry.
For a while, the yellow bikes became a national sensation, visible on every street!
Between 2015 and 2018, Ofo raised over 15 billion yuan in eleven funding rounds!
However, behind the unlimited glory, concerns gradually surfaced.
Starting at the end of 2018, Ofo faced a financial crisis and continued to be criticized for its inability to refund deposits. On December 17 of the same year, Ofo launched a deposit refund system, with over ten million users applying within 24 hours.
As of May 2023, all public channels failed to contact Ofo staff, and there was no clear timeline for deposit refunds. The official phone numbers of Ofo’s affiliated companies were also reported as unreachable.
It is understood that over 16.63 million people are still in line for Ofo deposit refunds, with deposits ranging from 99 to 199 yuan. Even at the lowest rate of 99 yuan per person, the pending deposits amount to a staggering 1.65 billion yuan.
Undoubtedly, Dai Wei led Ofo to ride the wave of the sharing economy in China but left behind a severe burden of unreturned deposits and debts that he is currently unable to bear!
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User deposits remain unrefunded, and Dai Wei, under spending restrictions, somehow ended up in the U.S., seeking a new entrepreneurial direction.
First, he founded a mobile power rental startup in Seattle, which didn’t fare well. Then, he started a coffee chain in New York, and Dai Wei’s U.S. coffee entrepreneurship seems quite “bleak”!
Perhaps he deserved this failure – he found a way to “escape” to the U.S., but did he not research the spending habits in the U.S.?
In the U.S., mobile payments currently account for only 15% of total sales in chain stores, and Americans still prefer using cash and credit cards.
For About Time Coffee to achieve significant expansion, it would need to shift Americans’ payment habits to mobile apps to plan the next steps and drive business online.
Additionally, About Time Coffee faced significant location issues.
Some U.S. users complained, “All five stores are in tourist areas, not only is the coffee shop not busy in the morning, but tourists won’t enter an unknown shop for coffee. If it were located in Greenwich or East Village, maybe there would be some customer retention.”
Upon reflection, Dai Wei’s second entrepreneurial failure doesn’t seem accidental!
The failure of Ofo’s yellow bikes was not just due to a financial crisis and market competition but also because Dai Wei lacked innovation and foresight in entrepreneurship.
According to analysis on Zhihu, Ofo failed to continuously innovate and optimize the shared bike model and product, failed to address user pain points and needs, and failed to build a stable user base and loyalty.
Dai Wei’s coffee project in the U.S. appears to be an imitation and speculation, lacking his in-depth understanding and passion for the coffee industry, failing to provide users with valuable and meaningful services and experiences.
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Currently, it seems Dai Wei’s hopes of turning things around with the coffee project are dim. Dai Wei’s second entrepreneurial attempt is likely to end in failure once again.
There was a Classical Chinese biography narrating the life experiences of Dai Wei, and it reads as follows:
Dai Wei, a talented individual, fell short of grand ambitions. Initially, as shared bikes thrived, he entered the scene, co-founding Ofo, aiming for a major achievement and revolutionizing transportation worldwide. He secured billions in funding, expanded rapidly, and at its peak, Ofo’s yellow bikes were everywhere in the city. However, the good times were short-lived, facing numerous challenges – extensive bike damage, poor management, fierce market competition – the business became unsustainable. Despite Dai Wei’s efforts, the company eventually went bankrupt, owing 1.5 billion yuan in unreturned deposits, affecting over 16 million users. Fearing legal consequences, Dai Wei fled to the United States, raising funds for About Time Coffee, only to face failure again!
A Peking University prodigy, darling of the capital, burning through 15 billion in 3 years – can Dai Wei escape this time?
Tianyancha shows that starting from August 2018, Dai Wei received 41 spending restriction orders. Currently, out of Dai Wei’s 12 companies, 7 are still in existence. Among them, Shanghai Aofu Hesheng Network Technology Co., Ltd., owing over 540 million yuan due to a loan contract dispute, is facing challenges.
Five years ago, Ofo’s headquarters was crowded with users seeking justice, but it had no substantial impact as Ofo had no assets left for execution.
Even now, under Ofo’s official Weibo posts, many users question, “When will the money be refunded?” “My deposit hasn’t been returned, and your boss is spending money to treat Americans to coffee?”
For Dai Wei to succeed in his current entrepreneurial endeavor, he needs to address every user’s most urgent demand – refund my deposit!