Facebook and PayPal invest in ride-hailing giant Gojek
It's the second international investment Facebook has made in the past six weeks
Jakarta — Facebook and PayPal Holdings are investing in Gojek, a big boost for the Indonesian start-up’s digital payments business that propels the US companies into a fast-growing Asian internet arena.
It’s the second international investment Facebook has made in the past six weeks with a goal of getting more local businesses online, after the social media giant paid $5.7bn for about 10% of India’s Reliance Jio. It plans to build a commerce and payments business around WhatsApp, on top of letting businesses use the messaging service to interact with customers.
The deal announced on Wednesday marks Facebook’s first investment in an Indonesian company and is a major boost for the country’s largest start-up, a ride-hailing giant that has morphed into a provider of services such as payments and meal delivery. Gojek is now backed by some of the world’s largest internet companies from Alphabet’s Google to China’s Tencent Holdings, helping it compete against Singapore’s Grab.
“WhatsApp in particular can be instrumental in creating a more digital Indonesia by bringing more people into one of the fastest growing digital economies in the world,” Facebook said in a blog post. The company didn’t specify how much it is investing and a spokesperson declined to share details.
Indonesia is one of the world’s most promising internet markets, fuelled by rapidly expanding smartphone adoption and economic growth. It’s the largest country in Southeast Asia, anchoring a regional internet economy estimated at more than $100bn in 2019 and tripling by 2025.
Facebook and PayPal join Google and other US corporations in staking out a relatively undeveloped Asian digital payments arena outside China.
Facebook and PayPal joined Gojek’s funding round, which closed at $1.2bn around March at the height of the coronavirus pandemic.
Gojek and Grab aim to become Southeast Asian consumers’ default, all-purpose app, similar to Tencent’s WeChat. Gojek has drawn hundreds of thousands of merchants to its platform, providing them with access to more than 170-million users across the region.
The Indonesian start-up, whose backers also include Singaporean state investor Temasek Holdings, has said it will deploy fresh capital to keep expanding despite global economic turbulence. It recently acquired a mobile point-of-sale start-up called Moka for about $130m, people familiar with the deal have said.
Gojek, which debuted an app for hailing motorbike taxis in Jakarta in 2015, now also offers a score of other on-demand services such as house cleaning and medicine delivery, and was last valued at $10bn, according to CB Insights.
“We see our role as a convener of global tech expertise, facilitating collaboration that will ultimately lead to a better future for everyone in our region,” Gojek Co-CEO Andre Soelistyo said in a statement.
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