The Great Bike-Sharing Collapse of China
This is your Data Sheet for Tuesday, December 10, 2019
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As I was driving home on a rainy Sunday afternoon in San Francisco, I passed a man on a bicycle with a small cage on his handlebars. Inside the cage were two ducks. Just another day here, really.
I thought of them Monday while reading Grady McGregor’s fine piece out of China about its demise of the over-invested bike-sharing craze. There’s a truism in tech-industry investing that parallels the adage about a waddling creature that walks and quacks like a duck very likely being one. Well, an investment craze that looks like a bubble and acts like a bubble—billions in, losses out, more investors than users—almost certainly is a bubble.
This one has burst completely.
The biggest players are discredited, acquired for a song, or gone completely. Chinese investors proved they are no different from tech investors everywhere else: They are perfectly capable of pumping too much money into a good idea and then ruining it. Here’s my photo of just another street corner in Guangzhou last month:
Somehow, otherwise smart people, such as the fine business minds at Alibaba and Tencent, convinced themselves that the normal laws of supply and demand didn’t matter when “platforms” needed building and competitors needed vanquishing.
McGregor’s hunch is that Chinese artificial intelligence investments are next, and that sounds right. A.I. investments, in China and elsewhere, fit the bill: tremendous promise, even more hype, plenty of suckers afraid they’ll miss the opportunity if they don’t invest now.
If you listen carefully you can hear the quacking.
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A well-placed source suggested a Google executive as a potential No. 2 to newly promoted Alphabet CEO Sundar Pichai: Susan Wojcicki, CEO of YouTube. She is as O.G. as anyone senior at Google, has known the founders since they were pups, and runs a giant business inside the company.
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Fortune published a list of travel tips from its far-flung journalists, including me. It’s fun. And might help relieve the pain.
Adam Lashinsky
Twitter: @adamlashinsky
Email: adam_lashinsky@fortune.com
This edition of Data Sheet was curated by Aaron Pressman.