The Growing Internet Economy in Southeast Asia
Facebook and PayPal Back Indonesian Startup Gojek
Gojek, Indonesia’s biggest startup, raised $1.2 billion in this latest funding round, bringing its valuation to $10 billion. Facebook and PayPal join other international tech giants already backing the company, like Google (GOOGL), and Chinese conglomerate Tencent Holdings Ltd. (TCEHY).
With Facebook’s investment, Gojek will be able to increase its online presence using WhatsApp. “WhatsApp helps small businesses communicate with customers and make sales, and together with Gojek, we believe we can bring millions of people into Indonesia’s growing digital economy,” WhatsApp COO, Matt Idema, wrote in a recent blog post .
As for the partnership with PayPal, Gojek is hoping to provide users of its digital wallet, GoPay, access to PayPal’s 25 million merchants throughout the world.
Gojek and Grab Compete for ‘Super App’ Status
The investments from Facebook and PayPal bring Gojek one step closer to becoming Southeast Asia’s biggest “super app,” an app with multiple services bundled into one.
Gojek’s biggest competitor is Grab, a Singapore-based app, which also offers a variety of services like ride-hailing, food delivery, and digital payments.
Both Gojek and Grab are working on adding services in the hopes of becoming the default app for Southeast Asian consumers in the way Tencent’s WeChat operates as a “super app” in China. For example, Gojek began as a way to hail motorbikes and now, just five years since its launch, it offers a multitude of other services like medicine delivery and house cleaning.
Investments in Southeast Asia Expand Beyond Gojek
It makes sense why Facebook and PayPal would invest in Gojek right now because Indonesia currently has the fastest-growing internet economy in Southeast Asia. It is expected to be worth $130 billion by 2025. Southeast Asia’s total digital economy will be worth an estimated $300 billion in five years.
Gojek was Facebook’s first investment in an Indonesian company, but it has made other investments in Southeast Asia before. In fact, Facebook recently pumped $5.7 billion into Indian telecom giant Jio Platforms Ltd, the biggest mobile carrier in India.
Companies like Facebook and PayPal are capitalizing on the booming Southeast Asian digital economy, and are looking for ways to get involved with more small and medium-sized companies within those markets.