Grab raises $1.46b from Vision fund, bumps up Series H total to $4.5b

Grab
A GrabCar driver uses the Grab app on a smartphone in Singapore. Photographer: Ore Huiying/Bloomberg

Ride-hailing unicorn Grab has raised $1.46 billion in fresh funding from the SoftBank Vision Fund, bringing the total amassed in its ongoing Series H to $4.5 billion, according to a statement on Wednesday.

SoftBank Group Corp is an existing Grab investor. It first bought a stake in Grab for $250 million in 2014 and later, in 2017, co-led a $2-billion investment in the Singapore-headquartered firm, along with Didi Chuxing. SoftBank has been transitioning its stake in Grab and other ride-hailing firms to the Vision Fund.

“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,” said SoftBank Investment Advisers partner David Thevenon.

DEALSTREETASIA had earlier reported that Grab was looking to raise up to $5 billion in the ongoing Series H round amid increased investor interest. Investors in the round include Toyota Motor Corporation, Oppenheimer Funds, Hyundai Motor Group, Booking Holdings, Microsoft Corporation, Ping An Capital, and Yamaha Motor.

Grab plans to use its growing pile of capital to expand its super app strategy across the region, with a focus on Indonesia – the home ground of archrival GOJEK – where Grab claims to be the leader in ride-hailing and O2O (online-to-offline) services.

According to Grab, it has 60 per cent market share of the two-wheel market and 70 per cent of the four-wheel market in Indonesia. It also claims that its Indonesian business is expanding rapidly, with revenue more than doubling in 2018.

A significant portion of the funding will also go into the expansion of GrabFood and GrabExpress and rolling out new verticals in Indonesia. Citing research by Kantar, Grab said GrabFood is the second largest food delivery service provider in the archipelago.

Across the region, the startup plans to grow its verticals such as financial services, food delivery, parcel delivery, content and digital payments, and roll out new services announced in 2018. The services include on-demand video, in partnership with HOOQ; digital healthcare, in partnership with Ping An Good Doctor; insurance, in partnership with ZhongAn International; and hotel bookings, in partnership with investor Booking Holdings.

After the acquisition of Uber’s Southeast Asia operations in 2018, Grab said its transport business has “grown robustly”, almost doubling its revenue from last March to December. GrabFood’s revenue, it claims, grew 45 times in the same period.

Meanwhile, Indonesia-based GOJEK is said to have hired Citigroup Inc’s investment banking unit to work on its extended Series F funding round, having already raised over $1 billion as part of the round from investors including Mitsubishi Corp. and Provident Capital, along with Google, JD.com and Tencent Holdings.

The Philipines’ oldest conglomerate Ayala Corp may be looking to invest in GOJEK’s Philippine venture to take on Grab after the Indonesian unicorn was denied regulatory approval to enter the market for non adherence to foreign ownership limits.

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