Indonesian ride-hailing firm Go-Jek has added capital atop its ongoing Series F from Mitsubishi Motors Corp., Mitsubishi Corp., and Mitsubishi UFJ Lease & Finance, according to a press release. This new investment was announced days after its competitor, Grab, raised money for its on-going Series H from credit-rating company Experian.
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The financial terms of the deal have not been disclosed; Go-Jek and Mitsubishi did not immediately respond for comment.
Osamu Masuko, chairman of Mitsubishi Motors, said that he “believe[s] that the accumulation of know-how of new mobility services that are rapidly spreading in the region and the opportunity to enter the market will contribute to the growth of the Southeast Asian market in the future.”
While Go-Jek has said it is working on expanding and investing in new verticals, some of that cash is probably fueling its acquisition spree. According to its Crunchbase profile, Go-Jek has acquired 11 companies to date, including AirCTO, an AI-powered recruiting platform and Coins.ph, which helps deliver financial services over mobile to underbanked people.
Andre Soelistyo, President of Go-Jek Group, said this recent investment is a “testament to the strength of the Go-Jek vision to use technology as a means to improve the everyday lives of people in Southeast Asia.”
So what’s driving these funding rounds? We know that ride-hailing companies need a lot of money to keep wheels on the road. For companies like Grab and Go-Jek, that cash burn works since they have a steady pipeline of investors willing to put money into the company. But for companies like Chariot cash burning without constant checks can lead to a wreck.
On-going rounds, as Alex Wilhem put it, let companies keep a pre-money valuation and allow more capital to come in at that price. In other words, it’s less dilution per dollar of additional capital.
Before this reported round of investment, Go-Jek last raised a $100 million Series F in March. Its total funding to date, excluding rounds that don’t have reported totals, is $3.1 billion. For comparison, Grab raised about half of Go-Jek’s total funding in a single $1.46 billion round led by Softbank Investment Advisers.
For both companies, becoming the “super-app” of their regions is the goal. Both startups have jumped into other verticals, like food delivery and rentals, and presumably this influx of funds will continue to fuel those fires as well.
Illustration: Li-Anne Dias.