How Apple’s Tim Cook struck $1bn Didi app deal in 22 days

The tie-up between Apple and Chinese car-hailing app Didi started off with a joke.

How Apple’s Tim Cook struck $1bn Didi app deal in 22 days

Didi president Jean Liu said yesterday that talks began less than a month ago, when she stopped by to see Tim Cook, at Apple headquarters, in Cupertino, California.

Any company named after a fruit “could achieve something big”, she jested during the April 20 meeting. Didi’s legal name, Xiaoju Kuaizhi, means ‘little orange’, she explained.

The $1bn (€876m) deal was announced just 22 days later.

Ms Liu, a former Goldman Sachs banker, frequently meets with tech executives when she visits the US. She did not go into the meeting to ask for capital, but, rather, to discuss the China market and opportunities for co-operation.

“The whole deal closed in lightning speed,” Ms Liu said. “We were very impressed by Tim. He’s an amazing, iconic leader.”

There is much to gain on both sides. Didi, battling with Uber for supremacy in China, will get additional capital to expand into new cities, recruit drivers, and market to potential customers. The Apple investment will bring the amount Didi is raising, in its current round of funding, to $3bn.

Apple gets a potentially lucrative investment and wins powerful allies in one of its most important markets.

Didi is backed by China’s two largest internet companies, Alibaba and Tencent.

They could help Apple to market Apple Pay, and other services, as well as giving it experience in transportation, as it weighs an entry into automobiles.

Getting Apple on board as a strategic investor is partly aimed at thwarting investors from putting money into Uber.

Didi is targeting a valuation of $26bn, which would make it the fourth-most-valuable startup in the world, after Uber, Xiaomi, and Airbnb. Didi has been waging battle with Uber ever since it was created early last year through the merger of startups backed by Tencent and Alibaba.

The combined company, then known as Didi Kuaidi, held a near monopoly on taxi-hailing and a substantial majority of private-car bookings.

In May of last year, Didi announced it would give away 1bn yuan ($153m) in free rides, the first salvo in a price war with Uber that would cause both sides to burn through cash.

More in this section

The Business Hub
Newsletter

News and analysis on business, money and jobs from Munster and beyond by our expert team of business writers.

Sign up
Puzzles logo
IE-logo

Puzzles hub

Visit our brain gym where you will find simple and cryptic crosswords, sudoku puzzles and much more. Updated at midnight every day.

Lunchtime
News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up
Revoiced
Newsletter

Our Covid-free newsletter brings together some of the best bits from irishexaminer.com, as chosen by our editor, direct to your inbox every Monday.

Sign up