China’s booming sharing economy may be facing difficult times amid growing evidence that financing activities have reached their peak. The industry raised a record CNY216 billion last year, an increase by more than a quarter compared from a year earlier, according to a report by the State Information Center (SIC). “Competition among platform companies will grow fiercer, accompanied by an increasing number of mergers and acquisitions,” SIC wrote in a March report, adding that policy guidance is expected to play a bigger role to ensure “overall quality” development.

China has seen the sharing economy take off over the past two years. Reminiscent of the dotcom boom in the late 1990s, many start-ups in China have raised millions of dollars by promoting concepts linked to the sharing economy. However, the flood of money has begun to cool since the second half of last year. Among the most prominent sectors attracting institutional investment is bicycle sharing, which has been popularly referred to as one of China’s four modern-day “inventions”, together with high-speed rail, mobile payments and online shopping.

Six sharing bike platforms have run into difficulty since June. Bluegogo, once China’s third-largest player, ceased business operations in November due to lack of cash. Others that closed down that month included Wukong Bicycle, which folded after just five months, and 3Vbike, which focused on third-tier cities. November also saw the demise of Mingbike and Kuqi Bike, both of which have been sued by customer watchdogs for failing to refund deposits. At its peak, there were about 100 companies offering similar short-term bicycle rental services in China.

Other sectors of the sharing economy are also suffering bankruptcies. Beijing-based car-sharing companies Ezzy and Youyou, as well as umbrella-sharing company Huoli Modeng and sleeping-capsule sharing enterprise Xiangshui Space have all folded. These start-ups typically failed because they exhausted their funds before being able to find a sustainable profit model, the South China Morning Post reports.