Gojek’s management team first hatched the plan following Uber’s exit from Southeast Asia, an investor with knowledge of the effort told us. However, nearly two years later, it remains incomplete. Gojek announced a $1.2 billion raise in May 2019, but the remainder has not yet been gathered. The company has struggled to convince investors of its $10-billion valuation target.
“Our fundraising remains on track and in line with expectations,” the Gojek spokesperson said. The company also rebuffed suggestions that it is open to a merger deal with Grab, as reported by The Information last month. “There are no plans for any sort of merger and recent media reports regarding discussions of this nature, are not accurate,” the spokesperson said.
New era of sustainability
Question marks around Gojek’s expansion could not come at a worse time for the company, given the global shift in focus from aggressive growth to profitability among startups and investors.
Gojek has to learn the ropes and gain market share in each new market. It also has to figure out how to stitch regional operations together, while keeping its spending in check. It may not have retreated from expansion posts, but Gojek has become acutely aware of its financial mortality and made cutbacks. In December, it confirmed it would shut down the majority of its GoLife services in Indonesia, including laundry, beauty and home services on-demand, due to an apparent lack of adoption.
It appears that Gojek is still saving much of its capital for Indonesia to quell Grab’s offensive. It shelled out $30 million to buy a 4.3% strategic stake in taxi operator Blue Bird, in a deal that offers a whopping 62% premium on its stock price. Gojek is also reportedly in talks to acquire Moka, a local point-of-sale startup. In food delivery, the battle for market share between Gojek and Grab has become so intense that the steep discounts they offer users have made food prices more affordable and kept Indonesia’s inflation low, according to a Bloomberg report .
The last remaining market in South
As the year continues, there’s likely to be greater pressure on Gojek’s international services if they continue to see middling performance. With Makarim departing the business, Gojek seems likely to reorganise and refocus on the fundamentals as a result of new leadership, particularly given that he was instrumental in setting many of those initiatives up in the first place.
The previously quoted technology executive suggests GoLife may not be the only service thought up by Makarim that is deemed expendable by co-CEOs Soelistyo and Kevin Aluwi. The two are long-time employees who were previously chairman and chief information officer, respectively.
Despite that, Gojek’s regional charge continues. In the Philippines, the company teamed up with a firm owned by Paulo Campos, who also serves as CEO of fashion e-commerce platform Zalora Philippines. The partnership was forged to fulfill the foreign ownership rules and qualify for an operating license to (potentially) finally launch transport services. Gojek hopes that will be “as soon as possible,” with the spokesperson saying the company is in discussions with the government.