Indonesia’s ride-hailing giant Go-Jek is in talks to raise a fresh funding round of another $1.5 billion to support its plan to expand into new markets and challenge Grab’s domination in the region following Uber’s recent exit, according to a report by The Information.
The fundraising has not been finalized as Go-Jek is still in talks with Tencent, Google, JD.com and other investors, the report said, citing people familiar with the matter.
Bloomberg had earlier reported that Go-Jek’s current backers including Tencent and Warburg Pincus have informally offered an additional funding of at least $1 billion to accelerate the startup’s overseas expansion.
The latest report follows Go-Jek’s announcement of the launch of its two locally-founded affiliate companies in Vietnam and Thailand. Go-Viet, its affiliate in Vietnam, and its Thai counterpart GET are set to launch their services in the second half of the year. The next two markets on the list, Go-Jek said, will be Singapore and the Philippines.
The Indonesian unicorn, which has evolved into an on-demand mobile platform, in February raised over $1.5 billion in a fundraising round, about 25 per cent more than it planned to, from a dozen backers including international investors BlackRock and Google, as well as domestic players like Astra International and Global Digital Niaga (GDN). The round valued Go-Jek at around $5 billion.
Of the $1.5 billion raised in February, Go-Jek said $500 million has been set aside for international expansion, as the company aims to increase its presence in Southeast Asia.
Go-Jek’s plan to expand outside of Indonesia has been in the offing for a while. In October last year, the firm’s founder and CEO Nadiem Makarim announced plans for the startup to operate in four unidentified ASEAN countries. However, Uber’s exit from the region in March seemed to have spurred Go-Jek to speed up its expansion plans.
Some fresh funding will give the company more firepower to fight rival Grab, which earlier this month secured $1 billion from Toyota Motor Corp, the lead investor in its latest funding round.
The financing was said to value the Singapore-headquartered company at $10 billion and followed the company’s $2.5-billion Series G round in July 2017, which was co-led by Didi Chuxing and SoftBank.
Earlier this month, Grab also secured an S$500 million ($370 million) five-year, asset-backed syndicated facility deal.