Indonesia’s Go-Jek raises $1.2b led by Tencent, valuation soars to $3b

Piotr Jakubowski, CMO of Go-Jek

Indonesian startup Go-Jek has reportedly closed new funding of $1.2 billion led by Chinese internet giant Tencent, a TechCrunch article said.

The deal values the on-demand ride hailing app firm at $3 billion. Signed last week, it is expected to be officially announced “soon”, the report added.

Last month, this portal had reported that Go-Jek, which is backed by private equity (PE) majors like KKR & Co., Warburg Pincus LLC and others, is in talks with investors to raise an additional $1 billion.

Go-Jek is set to use this capital to expand across the region, with likely destinations being the Philippines, Thailand, Myanmar and Vietnam.

The Go-Jek-Tencent deal takes place as some of China’s largest tech firms are slowly entering Indonesia. Alibaba affiliate Ant Financial had recently announced partnership talks with media conglomerate Emtek. Last year, Alibaba had acquired Indonesia’s e-commerce giant Lazada in a $1-billion deal.

Meanwhile,, Alibaba’s fiercest e-commerce rival, is mulling over a plan to join forces with Jakarta-based Tokopedia.

Go-Jek is one of Indonesia’s largest startups by valuation and claims to have over 200,000 drivers across the country. The Sequoia Capital-backed startup was valued at around $1.3 billion last year when it raised $550 million from KKR and Warburg Pincus.

Tencent Holdings is a Chinese investment holding company whose subsidiaries provide media, entertainment, internet and mobile phone value-added services and operate online advertising services in China. It is also an investor in Didi Chuxing, which owns a minority stake in Go-Jek’s competitor Grab.

A recent Google-Temasek report estimated Southeast Asia’s ride-hailing market to be worth $13.1 billion by 2025, with Indonesia expected to be the largest market in the region.

The synergy between the two companies could see Go-Jek’s services collaborating with Tencent’s messenger app WeChat, which allows its users to conduct transactions such as shopping, ordering foods and rides, and appointment booking.

In January 2017, Tencent Holdings Ltd. and Warburg Pincus led a $215 million round of funding in one year-old Beijing startup Mobike, ratcheting up the competition in China’s burgeoning urban bicycle-sharing scene. The round brought in a clutch of new, influential names, including private equity firm TPG Capital, Chinese travel service International Ltd., and Huazhu Hotels Group. Existing backers Hillhouse Capital, Sequoia Capital also took part in the financing.

Escalating war

In Indonesia, Go-Jek fights US-based Uber and Singapore-based Grab, who recently bought O2O platform Kudo for $100 million. The purchase is seen as being critical to augment Grab’s mobile payments platform.

These developments came even as Grab was learnt to be in talks to raise an additional $1.5 billion in a new funding round backed by SoftBank Group. In September last year, Grab had raised $750 million at a valuation of more than $3 billion, which so far has been the largest fund raising in this region.

Also Read:

Go-Jek’s food delivery beats all Indian food startups combined: Piotr Jakubowski

Grab follows rival Go-Jek with R&D centre in India, adds in Vietnam too

Grab confirms acquisition of Indonesian payment startup Kudo

Singapore: Temasek-backed SMRT in talks to sell taxi unit to Grab