ofo pioneered bike-sharing in China — then couldn't return users' deposits

What happened

Why it happened

• ofo pioneered dockless bike-sharing and raised billions, but its business model depended on continuous funding and user deposits.
• A fierce subsidy war with Mobike burned cash at an unsustainable rate, and bikes were vandalized and left to rust.
• When the funding dried up, ofo ran out of money and could not return the deposits that millions of users had paid.
• Founder Dai Wei refused to sell or merge, and ofo faded, leaving millions of users waiting for refunds they never received.

Aftermath

ofo's collapse was one of the most prominent failures of China's bike-sharing boom, a cautionary tale about growth-at-all-costs and business models built on subsidies and user deposits. Millions of users were left waiting for deposit refunds they never received, and the image of bike graveyards became a symbol of the bubble. The lesson is durable: a company that grows by burning cash and holding user deposits is only as stable as its funding, and when the money runs out, the cost falls on the users who trusted it — a lesson that applies far beyond bike-sharing.