The Investment Spree In Ride-hailing Space Is Just Getting Started
It’s raining money in ride-hailing sector. Indonesian unicorn Go-Jek was in news yesterday for gulping nearly $100 Million funding from Astra International and now its arch-rival Grab has set a new benchmark in scaling investments. The Southeast Asian ride-hailing giant has secured $1.46 billion fresh funding from the Softbank Vision Fund.
This new funding brings the total financing secured in Grab’s current Series H round to over $4.5 billion. Other investors who participated in this round include Toyota Motor Corporation, Oppenheimer Funds, Hyundai Motor Group, Booking Holdings, Microsoft Corporation, Ping An Capital, and Yamaha Motor.
Anthony Tan, Grab’s co-founder and chief executive officer said in a statement, “SoftBank and the Vision Fund are long-standing strategic investors and we are grateful for their continued support. The investment is a clear statement of belief in our vision to grow Southeast Asia’s technology ecosystem as the region’s number one super app. Looking ahead, we aim to continue improving the lives of many millions of Southeast Asians by providing enhanced income opportunities through our platform, and giving our users more choice and convenience.”
Advancing Vision Southeast Asia
Singapore-headquartered Grab intends to use the funds to advance its super app vision in Southeast Asia, with the aim of bringing more every day services, greater accessibility and convenience to users.
The company plans to expand its verticals such as financial services, food delivery, parcel delivery, content and digital payments, and roll out new services announced in 2018.
Commenting on the investment, David Thevenon, partner at SoftBank Investment Advisers, said, “We have been working alongside Grab for a number of years and are privileged to support the evolution of its user-driven technologies. This investment will help the company explore exciting new opportunities across on-demand mobility, delivery and financial services as it continues to grow its offline-to-online platform across Southeast Asia.”
Grab plans to invest a significant portion of fresh proceeds in Indonesia, where it is the leader in on-demand transport with 60 percent of the two-wheel market and 70 percent of the four-wheel market. Its Indonesian business is expanding rapidly, with revenue more than doubling in 2018. The company will use the fresh capital to boost the expansion of GrabFood and GrabExpress and roll out new verticals in the country.
GrabFood is growing rapidly in Indonesia. It is operating in 178 Indonesian cities from 13 at the beginning of 2018, with delivery volumes growing almost 10 times last year. The past year has seen a vital expansion of the Grab ecosystem through partnerships with global industry leaders such as Toyota, Hyundai, Microsoft and Mastercard.
While it originally competed with Uber, Grab’s acquisition of Uber’s Southeast Asian operations in March 2018 has turned it into the only major ride share service in the region.