Professional Documents
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Asia
Anthony Tan and Tan Hooi Ling spun the idea of building a ride-hailing company, Grab,
while pursuing MBA at Harvard Business School. Grab was initially conceived as a college
project and had bagged US$25,000 in prize money from the pitch contest organised by the
school.
Hailing from Malaysia, the duo was aware of the chaotic and unorganised scene the Southeast
Asian countries’ transportation sector faced. Moreover, rolling out a ride-hailing service in the
region would give them first-mover advantage. Bringing together their knowledge in business
administration and general management, the two started jotting down a business plan and built
the application with the prize money they won from the pitch contest.
After sleepless nights and countless brainstorming sessions, Anthony and Tan rolled out
GrabTaxi in 2012 in Malaysia—just a year before Uber launched its ride-hailing service in
Singapore and two years after Go-Jek in Indonesia.
Like in any developed and developing nations, ride-hailing has become an everyday app in the
SEA countries as well. The region’s online economy is driven heavily by a large, growing, and
incredibly engaged internet user base. A 2018 report by Google and Temasek suggests the
Southeast Asian internet economy has reached US$72 billion in (GMV). And, taking the lead
position are online travel, e-commerce, online media, and ride hailing sectors, the same report
suggests.
With Grab, basically, one can swipe into its mobile-based application to hire anything that rides
on wheels. It has introduced more than 10 on-demand ride-hailing services — including taxis,
private cars, car-pooling, bicycle sharing, shuttle services, and bike taxis — with more than 2.8
million drivers processing over six million ride orders everyday. In fact, Grab is mulling into the
mantra of providing everything in the consumer services sector, too.
Touted as the super app model, Grab has forayed into multiple consumer services sectors such
as hotel booking service, on-demand video platform, ticket purchasing, food ordering, grocery
shopping, besides offering financial services. The model is believed to have been first pioneered
by Chinese multinational conglomerates, Alibaba’s Alipay and Tencent’s WeChat. For now, Grab
is among the front-line companies spearheading this model. It generated a revenue of more
than US$1 billion in 2018, and hopes to double it in 2019. In January 2016, GrabTaxi was
rebranded to Grab, with the cofounders maintaining that the change in name will reflect all the
industries it operates with. Let’s look at these industries Tans have their eyes set upon.
Grab has also forayed into providing loans and insurance services as part of its “Grow with
Grab’ roadmap” strategy. It currently provides loans to small-medium enterprises (SMEs) and
micro-insurance for drivers in Singapore. Grab claims to have built a merchant network
comprising more than 600,000 merchants. The SEA insurance market is the six largest with a
valuation of US$100 billion. GrabPay already allows consumers to pay online for making a
purchase on e-commerce platforms such as Qoo10, 11Street, etc.
Finally, GrabPay has extended its financial services towards offering ‘Pay Later’, a post-paid
and instalment payment service in Singapore. This service allows customers to pay for Grab
services at the end of the month without bearing an additional cost!
GrabFood is currently available across 200 cities in six major SEA countries — and uses
GrabPay for checkout. Grab driver-partners are often seen doubling their earning by becoming
GrabFood delivery-partners. One of the company’s top executives claim that GrabFood’s
revenue has grown 45 times during the period between March 2018 and December 2018.
What’s More
In April this year, Grab added four new industries – hotel booking, on-demand video streaming,
ticket purchasing and trip planning – to its app in Singapore. The company plans on rolling out
these services to all users in its open, super app by June 2019. The company has partnered
with hospitality and OTA platforms, Agoda and Booking.com; and with Singaporean video on-
demand streaming platform HOOQ, and India-headquartered BookMyShow, for its latest
initiative.
Ever since Grab acquired Uber’s SEA operations, these two companies have been battling for
supremacy in the region with their “Super App”. For many years, Grab and Go-Jek are likely to
take the dormant position in the consumer industry, while offering everything on one-stop
platform, super app.