Placeholder Image

Subtitles section Play video

  • This company accounts for 2% of Indonesia's GDP.

  • Hopefully one day we'll contribute to 5 to 10%.

  • Has superstar ambassadors.

  • Congratulations!

  • And is vying to become Southeast Asia's most valuable start-up.

  • But you may never have heard of it.

  • So what exactly is GoTo, and how did it get so big?

  • GoTo Group is an Indonesian tech company formed in May 2021 in a blockbuster merger between

  • two of the country's largest start-ups: Gojek and Tokopedia.

  • In some sense, this is a long history in the making.

  • The main product of the merger, a powerful super app you can use to book a ride,

  • buy something or make a payment, is today used by tens of millions.

  • But the road to this landmark union started more than a decade ago.

  • Founded a year apart in the capital Jakarta, Tokopedia started in 2009 as an e-commerce

  • marketplace to connect small merchants with buyers, while Gojek launched in 2010 as a

  • ride-hailing platform for motorbike taxis.

  • Both companies were created by a group of friends in their twenties, who were responding

  • to an emerging wave of internet connectivity taking hold of the country at the time.

  • So in 2007, we at Tokopedia see the opportunity where Indonesia is already the king of social media.

  • And we believe that if we can build a platform, an online marketplace, where we can connect

  • these strangers across the island, with the power of internet we should be able to democratize

  • opportunity and democratize commerce to everyone.

  • There was kind of this inflection point where people were seeing the potential of the internet there,

  • especially with the rise of mobile.

  • In a sprawling country with the world's fourth-largest population and a rapidly growing

  • middle class, the founders were onto something.

  • In the years that followed, both businesses ventured into digital payments and other services.

  • Tokopedia doubled down on adding new market segments such as parents, couples and small

  • stallholders to its ecosystem.

  • Meanwhile, Gojek expanded its ride-hailing platform regionally and grew its domestic

  • superapp, offering users on-demand services from food to massages and even manicures.

  • From day one, we offered multiple different services.

  • So we never saw ourselves as a ride-hailing company or a delivery company.

  • We saw that the ojek driver could do many things.

  • A human being on a motorcycle could do many things, and could be trusted to do many things.

  • And so, when we launched, we already had these multiple different services on the same base of drivers.

  • Then, in 2015, the two began working in partnership, using Gojek drivers to provide same-day delivery

  • for Tokopedia products during their off-peak riding hours.

  • We were the first in the world to bring together a partnership between an on-demand platform

  • with an e-commerce platform.

  • With that true collaboration, we uniquely create the first same-day delivery.

  • Both companies have grown to become juggernauts, boasting an impressive list of investors such

  • as Softbank, Alibaba, Tencent, Facebook and Google.

  • Their $18 billion merger, Indonesia's largest ever, comes amid fierce competition from Singapore-based

  • Shopee and Grab.

  • There was speculation they may merge with other regional start-ups.

  • I know there were a lot of rumors.

  • But in reality, we were under no pressure to do anything.

  • And, you know, when we looked at our futures, we actually realized that a lot of the things

  • that we've done together we really amazing but could be so much more if we actually were

  • under one company.

  • Under the new structure, GoJek's Andre Soelistyo takes over as CEO of GoTo Group and GoTo Financial,

  • Tokopedia's Patrick Cao becomes president, while Kevin and William will remain CEOs of

  • Gojek and Tokopedia, respectively.

  • The combined entity counts over 100 million monthly active users, more than 11 million

  • merchants, and over 2 million drivers in an ecosystem that represents 2% of Indonesia's

  • $1 trillion GDP.

  • Imagine that Amazon, DoorDash, Uber, PayPal, Stripe is combined together.

  • There's a saying that if you want to go fast, you go alone; if you want to go far,

  • you go together.

  • So GoTo, basically, is go far, go together.

  • GoTo is hoping that will help them capture a greater chunk of the market in Indonesia

  • and beyond.

  • Indonesia's digital economy is expected to be worth $124 billion by 2025 as the wider

  • Southeast Asian online market triples in value to more than $309 billion.

  • Florian Hoppe, a partner at management consulting firm Bain & Company, co-authored the research.

  • He told me more.

  • Indonesia obviously remains hugely exciting because population in Southeast Asia, huge

  • economic growth forecasts for the next 10 years or thereabouts, really turning into

  • a consumption-based economy as well.

  • And a big part of its story has been this quick adoption of digital services.

  • But in order to expand, Florian said businesses need to target their services at the 120 million

  • Indonesians who live outside urban areas across the 17,000 island archipelago.

  • Indonesia is now facing that next level of growth challenge.

  • A lot of the early growth was driven by key urban centers, was driven by Java.

  • That captures about half the population or thereabouts.

  • The next half is going to be the really interesting story.

  • How do you reach them?

  • Establishing logistics services there, onboarding them for payments, really starting to integrate

  • them in the digital economy.

  • For GoTo, that includes providing payments and financial services in a country where

  • 47 million adults lack access to mainstream financial services and products.

  • 92 million have never used a bank.

  • When you have 17,000 islands, to credit score everyone, it's so difficult, right.

  • But with this technology everyone has a mobile phone, and with this, you can capture and

  • actually build credit score to everyone.

  • It's these individuals who are underbanked or unbanked where falling sick or economic

  • shocks can really mean the difference between being in the middle class and falling back

  • into poverty.

  • And so this is really both a huge business opportunity but also an area where we really

  • think we can deliver a lot of impact.

  • To date, neither Gojek nor Tokopedia are profitable.

  • The company is said to be planning another round of fundraising before publicly listing,

  • likely in Jakarta and the U.S.

  • On timeframe, not only for the IPO, but on all product development, my timeframe is always

  • yesterday.

  • But to be realistic to the team and so on then it's as soon as possible.

  • We hope that we can aim to list by hopefully the end of this year.

  • The merger of GoJek and Tokopedia comes weeks after rival superapp Grab completed a Nasdaq

  • listing through the world's biggest special purpose acquisition company merger, valuing

  • it at almost $40 billion.

  • Goto is said to be seeking a public market valuation target of $35 billion to $40 billion.

  • In many ways, our story was the underdog story.

  • We were for a very long time, the smaller, less well capitalized player going against

  • global or regional giants.

  • And we've managed to thrive and succeed in spite of that.

  • The IPOs will also serve as a litmus test for the region.

  • If successful, it could pave the way for more tech start-ups to emerge as investor appetite

  • grows.

  • Southeast Asia, historically, has had a bit more challenging time getting on the radar

  • next to China and India, which are obviously much easier to digest.

  • Southeast Asia, with different countries, different local regulations and, actually,

  • a fairly fragmented geography as well has been a bit harder to grasp.

  • And, in fact, I think many international investors probably had trouble figuring out how much

  • potential is there.

  • If anything, the last few years have shown that now the digital economy is actually rivalling

  • at the very least India.

  • But the potential's clearly there and I think international investors have woken up

  • to that.

  • With their combined resources and business thriving in the new landscape, what about

  • GoTo's plans for the future?

  • Goto comes with a big responsibility.

  • We try to provide solutions for a problem that we figured out a decade ago.

  • But this solution will also create another problem.

  • With millions of drivers, the emissions, with so many merchants, the packaging and so on.

  • So we have a commitment by the year of 2030 how we can really drive zero waste, zero emissions,

  • and to become a company that can be a legacy for the next generation.

  • The bold aims imply the GoTo of 2030 could look very different to today.

  • But as far as the leaders are concerned, they're just getting started.

  • There's no doubt that our ambitions are global.

  • We have operations not just in Indonesia and we do believe that the future for our combined

  • group is one that goes beyond just one country.

This company accounts for 2% of Indonesia's GDP.

Subtitles and vocabulary

Operation of videos Adjust the video here to display the subtitles

B1 indonesia merger company southeast southeast asia platform

GoTo: The multibillion-dollar superapp behind Indonesia’s most valuable merger | CNBC Make It

  • 0 0
    Summer posted on 2021/06/07
Video vocabulary