Grabbing bigger market:
Investors include Oppenheimer-Funds and Ping An Capital
GrabBike riders wait for passengers outside a commuter train station in Jakarta. Grab says it will invest a major portion of the US$1bil in new funds in Indonesia as competition heats up with rival Go-Jek that is plotting an expansion to Singapore, Vietnam and Thailand.
SINGAPORE: Singapore-based Grab said it has secured US$1bil in fresh funding and will consider raising further cash, as the ride-hailing firm aggressively expands in Indonesia, South-East Asia’s biggest economy.
The latest fundraising comes less than two months after it secured US$1bil from Toyota Motor Corp and values the six-year-old startup at around US$11bil, a source close to the company said.
The firm was valued at around US$6 bil earlier this year when it bought Uber Technologies’ regional operations.
“We will continue opening the financing for certain investors that we think will add value,” Grab president Ming Maa told Reuters yesterday, declining to give any funding target.
He added that Grab was seeing significant demand from investors globally, both financial and strategic.
The latest funding in Grab came from global asset manager OppenheimerFunds, China’s Ping An Capital, Microsoft Corp co-founder Paul Allen’s Vulcan Capital, Macquarie Capital and Lightspeed Venture Partners, among others.
Grab already counts deep-pocketed investors such as Chinese ride-hailing firm Didi Chuxing and Japan’s SoftBank Group Corp among its backers.
It plans to use the new funds to expand its online-to-offline services, and invest a major portion of the proceeds in Indonesia, as competition heats up with Indonesian rival Go-Jek that is plotting an expansion to Singapore, Vietnam and Thailand. Grab said it had earmarked Indonesia, an emerging battleground for technology firms looking to serve a population of over 250 million people, as a priority market.
The ride-hailing firm is also seeking to transform itself into a consumer technology group.
It is offering services such as digital payments and food delivery.
Maa said parts of Grab’s business, including transportation, were already profitable in some markets.
And an initial public offering was not a focus for the company in the short term.
Ride hailing services in South-East Asia are expected to surge to US$20.1bil in gross merchandise value by 2025 from US$5.1bil in 2017, according to a Google-Temasek report.