Chinese internet giant Tencent Holdings is reported to be in talks about a possible investment Indonesia’s ride-hailing giant Go-Jek, according to The Information.
Based on information provided by sources “familiar to the matter”, so far there are no details yet on how much Tencent is willing to invest in Go-Jek and what they are planning for the future.
But the investment is going to be an interesting development in the ride-hailing startups battlefield in Asia, as Tencent Holdings has been known to have invested in several ride-hailing startups, including Didi Chuxing.
Didi Chuxing has minority stake and has participated in a funding round for Go-Jek’s own competitor, Grab.
Earlier this year, Grab launched its Grab4Indonesia master plan, which includes the setting up of an R&D facility in Jakarta, a social impact investment fund, and the expansion of cashless payments service GrabPay, as well as other opportunities in widening financial inclusion in Indonesia.
The ride-hailing giant gets US$700 million ready to invest in these projects, and has been rumoured to have acquired Indonesian e-commerce startup Kudo for US$100 million soon after the announcement for the plan was made.
On the same day as Grab launching its master plan, Go-Jek had also launched a hackathon competition as part of its mission to scout and develop local talents. Compared to the 150-man-strong R&D facility that Grab is planning, an annual hackathon seems a little anticlimactic for Indonesia’s first unicorn.
In a report, DailySocial suggested that the investment from Tencent might enable Go-Jek to expand its engineering team, in order to strengthen its cashless payment service Go-Pay. The fact that Tencent is an owner of WeChat might also be indicative of the direction that the Go-Pay platform might be taking.
Investment from Tencent might give Go-Jek the extra push it needs to leverage its talent pool and cashless payments service in order to take on Grab. However, the fact that Tencent also backs Didi Chuxing, who also backs Grab, may also trigger another question: Who’s laughing the hardest now?
The possible investment also raises a bigger question related to the position of Uber in the ride-hailing service battlefield in Asia. Didi Chuxing has always been believed to have the upper hand as an Asian startup following its merger with Uber China last year. With Go-Jek gaining an extra gold in its pocket, the prospect does not seem very bright for Uber.
If you ever catch yourself panicking about recent reports of foreign internet giant getting into your market and taking away all your prospective users overnight, remember what a group of well-funded local companies can do in the ride-hailing startups battlefield.