4 Things To Know About The Uber Rival Backed By Apple

You've probably never heard of Didi Chuxing. 

It's the Chinese ride-hailing app that Apple poured $1 billion into on Friday, and it's a name you're going to hear a lot more of soon. The largest service of its kind in China, Didi Chuxing (formerly Didi Kuaidi) could give companies like Uber a run for their money.

Here's everything you need to know about Didi:

1. It's Uber for China, but bigger

The service formed in February 2015, when two taxi-hailing companies, Didi Dache and Kuiadi Dache, merged . The company at first allowed users to hail only regular taxis , driven by professional drivers. That's because hiring non-professionals to shuttle people around in private cars had been illegal in most of China prior to 2015. 

That all changed in October, when Didi received China's first license to operate a private ride-hailing service. Since then, the company has exploded. It's estimated to have 14 million drivers , who complete 11 million rides a day in over 400 Chinese cities.

Didi has raised $4 billion in funding since October, and its valuation has jumped to around $20 billion  from just $16 billion earlier this year. Apple's investment is the single biggest injection of funds Didi has received since starting up. 

In addition, the app has powerful supporters. It's backed by a slew of major Chinese investment firms, as well as huge Chinese tech firms Tencent and Alibaba , which runs the country's largest e-commerce platform.

2. It's crushing the competition 

Didi dominates the Chinese market, making it tough for competitors like Uber to break in. Didi commands 87 percent of the market for private ride-hailing in the Asian country, and it's poised to expand further. It even runs a private bus service . 

The service has a deal with American ride-hailing company Lyft , letting people traveling in the U.S. use their Didi app to hail Lyft cars. Americans can use their Lyft app to hail Didi cars in China. 

The company also has partnerships with popular ride-hailing services in India and Malaysia. 

Plus, Didi is going in big on artificial intelligence , investing heavily in research to develop algorithms that can accurately predict demand and redirect drivers to areas where lots of people want a ride. 

Because of Didi's strength in China, Uber is losing $1 billion a year  in its effort to compete there. 

3. The Chinese government is down with it

Beijing's official position on companies like Didi has changed dramatically over the last year.

In May 2015, China's transport minister said the country would "never" permit private cars to operate as commercial ride-sharing vehicles. Ride-hailing services pose a considerable threat to the country's traditional taxi services, which are often tied to local governments. But later that year, China's sovereign wealth fund pumped $500 million into Didi, a strong indication that the government supports the expansion of ride-hailing services.

Government support could add an extra hurdle  for rivals trying to challenge Didi's dominance. 

4. It's had its share of controversy

In May, a Didi driver allegedly robbed and killed a young woman in the city of Shenzhen. The murder came a month after Didi fired  3,000 drivers with histories of drug use or other criminal behavior. And in April, two Didi drivers elsewhere in China were convicted of raping passengers. 

Still, the iPhone maker considers Didi a strong bet. As Apple tries to boost sales in China, its second-biggest market, investing in the largest ride-hailing app in the country could help Apple get an even stronger foothold .

“We are making the investment for a number of strategic reasons, including a chance to learn more about certain segments of the China market,” Apple CEO Tim Cook said, per Reuters . “Of course, we believe it will deliver a strong return for our invested capital over time as well.”