SG’s ComfortDelGro to set up $100m VC fund to invest in mobility startups

Photo: Bloomberg

Singapore’s largest taxi operator ComfortDelGro announced that it is setting up a $100-million corporate venture capital fund to focus on incubation and investments in mobility technologies and solutions that complement the company’s land transport business.

The fund – ComfortDelGro Capital Partners (CCP) – will invest in startups that plug technology gaps, and address the impact of disruptive challenges to ComfortDelGro’s core land transport business. The global fund will be managed at an arms-length basis with its own set of decision-making, approval and funding processes, said the taxi operator.

It added that it will focus on next-generation mobility companies that are seeking to raise their seed stage, Series A or B rounds.

“While we continue to pursue bolt-on acquisitions of our core land transport and related businesses, there is a need for us to develop and acquire new mobility technologies and solutions which will not only build on our strong foundations, but also enable us to branch out into new annexes. The strategic rationale for setting up the Fund is to help increase our leverage in partnerships with technology startup companies, by giving us a pathway to eventually acquire or monetise them,” said ComfortDelGro managing director and group CEO Yang Ban Seng.

SGX-listed ComfortDelGro has a total fleet size of over 43,000 buses, taxis and rental vehicles, with operations in China, UK, Ireland, Australia, Vietnam and Malaysia.

The setting up of the VC fund means that ComfortDelGro is joining the ranks of ride-hailing majors Grab and Go-Jek to spur transport-led VC investments in the region. Both startups have launched their respective venture arms, Grab Ventures and Go Ventures.

In June, Grab launched Grab Ventures across the region and in August, it announced that it has allocated $250 million just for Indonesia, the home base of its archrival Go-Jek. Go-Jek, too, had confirmed the establishment of Go-Ventures. This portal was the first to report about the Indonesian ride-hailing major’s foray into venture capital in May this year. Go-Ventures is reported to have invested in local media startup Kumparan.

Singapore is touted to be the next destination for the Indonesia-based startup as it announced the launch of a Singapore portal for drivers to pre-register themselves and be among the company’s first driver-partners in the city-state, following its launch in Vietnam in September.

Acquisition spree to take on digital disruption

On November 5, ComfortDelGro announced that it is acquiring Australian bus operator Buslink for A$190.9 million ($138.3 million) – its largest acquisition to date, enabling it to strengthen its bus operations in the market.

The acquisition will also make ComfortDelGro the largest private bus operator in Australia, with a combined fleet of over 2.250 buses across six states and territories. The deal comes three months after the transport company announced an A$110-million ($80 million) acquisition of another Australian bus operator, FCL Holdings.

Singapore-headquartered ComfortDelGro has been on an acquisition spree to battle digital disruption.

“Changes are taking place all around us and, with that, come opportunities. To this end, we have embarked on a more aggressive investment strategy as can be seen from the fact that we have invested over S$450 million ($326.7 million) in the year-to-date. We have also moved into new related businesses like non-emergency patient services and worked at growing existing revenue streams like non-scheduled bus services. We are also exploring opportunities in new businesses which leverage on technology and artificial intellengence. No stone is left unturned,” said ComfortDelGro chairman Lim Jit Poh.

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