Gojek, Tokopedia: the story of Indonesia’s biggest merger
This merger, which has been on the cards for months, marks the largest of its kind between two Asia-based internet media and services companies, and as an entity, contributes 2% to the country’s GDP, and counts more than US$1.8bn transactions and over 100m monthly active users.
The companies are preparing for a dual listing, both in New York and Jakarta for later this year with a proposed valuation of US$18bn (Gojek is valued at US$10.5bn and Tokopedia at US$7.5bn).
Why are Gojek and Tokopedia merging?
Gojek and Tokopedia have been in talks for months, however they have worked together since 2015, with Gojek's local network of drivers helping to accelerate Tokopedia's product deliveries.
While Tokopedia's CEO William Tanuwijaya discusses the merger and creation of GoTo Group as building a company that "creates social impact at scale, levelling the playing field for small businesses and giving consumers equal access to goods and services across the country", the reality is that the merger is very much about taking on Gojek's biggest regional rival, Singapore's super app Grab.
In fact, the merger, which was quite a few months in the making, follows almost a year of talks between Gojek and the heavily-funded Singapore super app Grab, which claims to be the 'leading superapp for deliveries, mobility and financial services in Southeast Asia'.
For almost a year, Gojek and Grab, the region’s two largest ride-hailing companies, and both decacorns, had been negotiating a merger, with speculation of a merger reaching its height in October/November last year. It did not pan out, however.
And mid-April, Grab announced that the company intends to go public in the US in partnership with Altimeter Growth Corp. in what is expected to be the largest-ever US equity offering by a Southeast Asian company.
What GoTo will look like
The GoTo Group will house three independent subsidiaries – Gojek, Tokopedia and financial services and payments unit GoTo Financial. The latter, GoTo Financial holds a 22% stake in digital lender Bank Jago.
According to a statement by Gojek and Tokopedia execs, both companies will continue to thrive and coexist as “standalone brands within the strengthened ecosystem” with the combined entity of GoTo functioning as a “globally unique and highly complementary ecosystem”.
Gojek co-CEO Andre Soelistyo will be GoTo’s Group CEO, and will lead GoTo Financial, while Tokopedia President Patrick Cae will serve as GoTo Group President. Kevin Aluwi will continue as CEO of Gojek and William Tanuwijaya will remain CEO of Tokopedia.
GoTo Group will continue to focus on the markets where Gojek already operates, which includes Indonesia, Singapore and Vietnam, and will offer everything from e-commerce to on-demand serviCes, such as ride-hailing and food delivery, and financial services.
“The creation of GoTo Group, with its broad and fast delivery services and its deep penetration, will mean same-day e-commerce delivery moves a step closer to becoming the norm in Indonesia. GoTo will also further develop its payments and financial services offerings to provide an enhanced financial experience to consumers, drivers and merchants while also expanding to reach more underserved segments in Indonesia, where 140 million people have little or no access to the country’s financial system,” the company said.
CEO William Tanuwijaya, said that in addition to accelerating the growth of Indonesia’s digital economy, GoTo Group “will make it easier for people from all walks of life to access quality products and services, anytime and anywhere”.
Timeline: India takes unicorn leap with six in five days
We chart an historic week in India’s tech industry, where in just five days, between 5-9 April 2021, the country achieved six new unicorns, bringing India’s total to 10 in 2021 to date, an immense unicorn leap from just seven in 2020 and six in 2019.
April 5: Meesho
India’s first social commerce unicorn, Meesho raised US$300m from SoftBank, Facebook and Shunwei Capital, giving the Bangalore-based startup a US$2.1bn valuation, a threefold jump from its previous funding round in 2019. Founded in 2015 by two IIT-Delhi graduates, Meesho connects producers and resellers, helping small businesses sell through social media. It has 45m customers and has enabled 13m entrepreneurs to start their online businesses with no investment.
April 6: CRED
Founded just over two years ago, Bangalore-based credit card repayment app CRED raised US$215m from Falcon Edge Capital and Coatue, nearly trebling its valuation to US$2.2bn from its January US$80m round. Allowing customers to pay off their credit card debt while earning CRED coins which they cash in for rewards, CRED has grown rapidly during COVID-19, doubling its customer base to nearly 6 million in a year.
April 7: API Holdings / Groww
The first epharmacy startup to gain unicorn status, PharmEasy (API Holdings), which has digitised 60,000 brick and mortar pharmacies and 400 doctors across India, raised US$350m in a round led by Prosus Ventures. Founded by four former Flipkart employees as a way of making investing simple, investment platform Groww became India’s second-youngest fintech unicorn, raising US$83m in Series D funding led by Tiger Global, quadrupling its previous round in September.
April 8: ShareChat
New Delhi-grown social media startup ShareChat, founded in 2016 by Mohalla Tech raised US$502m from Lightspeed Ventures, Tiger Global, Twitter and Snap taking its raised total over six rounds to US$766m and pushing its valuation to US$2.1bn. The funding will be used to grow its user base and short video platform Moj, which launched in 2020 following TikTok’s ban in India. The regional language startup claims 280m users.
April 9: Gupshup
AI-led conversational message startup joined the unicorn club after raising US$100m from Tiger Global giving it a ten-fold valuation of US$1.4bn. The smart messaging platform, which has seen accelerated growth during the pandemic, was founded in Bangalore in 2005 by serial entrepreneur Beerud Sheth, whose online freelancing platform Elance is now listed. Gupshup’s API enables 100,000+ businesses to build messaging and conversation experiences across 30+ communication channels.