Indonesia-based ride-hailing company Go-Jek is reportedly planning to raise at least another $2 billion to finance its expansion in Southeast Asia.
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Go-Jek previously raised $2.1 billion, the majority of which was sourced from its $1.5 billion Series E led by Tencent in February 2018. At that time, Go-Jek was valued at $5 billion, post-money. Go-Jek’s investors include other China-based companies like Meituan Dianping and JD.com, and U.S.-based Google, among others.
These reports come on the heels of an announcement that Singapore-based Grab raised an additional $1 billion in early August, bringing its valuation to $11 billion. The company is backed by Chinese ridesharing company Didi Chuxing and Softbank.
Go-Jek will use its new funds to further its expansion in the region, according to Bloomberg’s report. As previously reported, the company currently operates in 50 cities in Indonesia, and launched in Vietnam in August with plans to move into Thailand and the Philippines. Grab currently operates in 225 cities in 8 countries in the region, and according to TechCrunch, Grab claims to take up 65 percent of the market on Go-Jeks home turf in Indonesia, where it plans to continue to expand.
In efforts to become the WeChat of Southeast Asia, both Go-Jek and Grab have moved beyond ridesharing into other verticals. Grab has added food and parcel delivery, bike and car rentals, and payments to its platform. Meanwhile, Go-Jek hosts services accross its Go-Jek, Go-life, and Go-pay platforms ranging from grocery and pharmacy delivery to at home massages and auto care.
The current state of ridesharing competition in Southeast Asia is reminiscent of the heated battle in China. Former competitors Didi Kuaidi and Didi DaChe competed in an expensive customer acquisition war before merging to become what is now Didi Chuxing. Didi Chuxing ended up acquiring Uber China in 2016 to dominate the ridesharing market in China, but it is not profitable and has been the subject of media scrutiny.
Whether or not Go-Jek and Grab will share a similar story is unclear. Right now, it seems the companies are preparing their war chests for an even larger battle for customers in the region.