Another large sum of money is going in Asia’s taxi app space following SoftBank’s $250 million investment in GrabTaxi and Uber’s latest Asia-focused $1.2 billion raise. That’s because Didi Dache, one of China’s two dominant taxi app firms, announced that it has closed a whopper $700 million Series D round.
Singapore’s Temasek Holding — which invested in Rocket Internet’s Lazada last month — led the round, which included participation from existing investors DST Global and Chinese internet giant Tencent.
The company is not disclosing its valuation, but this new funding round — which is one of the largest ever for a Chinese tech firm — is a huge jump on its $100 million Series C round from January this year.
Didi Dache claims to have over 100 million registered users and more than 1 million taxi drivers on its platform. The company covers 300 cities in China and says that it processes 5.2 million orders per day.
Its main rival is Kuaidi Dache, a fellow Chinese firm that is backed by Alibaba, Tencent’s arch rival. Between them, the two are estimated to account for close to all of the taxi app bookings made in China. That illustrates the challenge that Uber faces in China.
Didi Dache’s core offering is a taxi booking service. It integrates with Tencent’s WeChat, China’s hugely popular chat app, to allow users to book their ride from inside the app itself. That partnership alone accounts for over 20 million bookings per month.
The company launched a direct competitor to Uber’s Black service — it is shamelessly called Didi Black — in August. Didi Black covers 16 of China’s primary cities and the company claims that it sees 150,000 bookings per day. Uber doesn’t reveal data for China, but it is almost certainly seeing far, far less interest in its services in the country.
Uber stepped into China back in August 2013 when it launched a test service in Shanghai, and today it operates in eight cities. It offers its Uber Black and Uber X services as well as a non-profit service called ‘People’s Uber’ which works much like a Lyft service.
The U.S. firm pledged to spend much of its new $1.2 billion funding round on developing its position in Asia. That will include a significant focus on India — where it is currently under pressure following an alleged rape — as well as China, Japan, Korea and Southeast Asia.
But its battles in Asia are far from won. It is not likely that Uber will pour $700 million of that round into China, which means Didi Dache will have far greater resources in China to cement its already strong lead over the U.S. firm.
It seems likely that Kuaidi Dache is also in the market for more financing. That would put Uber well behind its top rivals in China, leaving it with a huge challenge to break their dominance in the country.
“Didi will continue its commitment in providing mobile-based transportation services to more users, strengthening our market leadership, increasing efforts in research and development and enriching our product offerings. The company believes in its mission of making transportation easier for everyone through mobile Internet,” said Didi Dache founder and CEO Cheng Wei in a statement.