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2 July 2020 (closed)
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One of Indonesia's biggest conglomerates, Astra International, announced earlier this week that it decided to invest USD $150 million in ride-hailing app Go-Jek, Indonesia's first unicorn. Go-Jek, which delivers a range of on-demand services (but is most widely known for its online motorcycle and car taxi services), is now valued at USD $4 billion.
Prijono Sugiarto, President Director of Astra International, said the capital injection into Go-Jek is a win-win situation for both companies as it leads to value-added businesses and is good for the Indonesian consumer and economy. Sugiarto added that he is impressed with Go-Jek's ability to keep innovating as well as Go-Jek's listing in Fortune's 2017 “Change the World” list (Fortune's list of influential companies across the world).
Although Astra International is a diversified conglomerate, it still relies heavily on the automotive sector (specifically car sales). The company accounts for 56 percent of total car sales and for 75 percent of total motorcycle sales in Indonesia. However, both the car and motorcycle markets of Indonesia have been rather stagnant in recent years and therefore Astra's move to expand into the digital car and motorcycle business, where there still exists plenty of growth, is considered a good strategic move.
Due to Astra International's dominant position in Indonesia's automotive and motorcycle sales market, it has a combined database of between 10 and 15 million car and motorcycle units. This is also reason why both companies can join hands. Those who drive a unit sold by the Astra Group can more easily register as Go-Jek or Go-Car driver, while existing drivers can perhaps more easily buy car or motorcycle components from the Astra Group.
Meanwhile, Nadiem Makarim, Go-Jek founder and CEO, said the investment from Astra International is the largest capital injection Go-Jek has ever received. The additional capital will help to create more innovations and improve the strength of the Indonesian economy. The collaboration between both companies will involve the supply of vehicles and financing.
Late last month it was confirmed by Google that it also invested in Go-Jek as part of Google's strategy to support and to participate in the thriving Internet economy of Indonesia. It is estimated that Google invested about USD $100 million in Go-Jek.
Capital Injections in Go-Jek:
• Astra International
• Temasek Holdings
• Tencent Holding
• GDP Ventures (Djarum Group
|USD $1.2 billion|
|• Northstart Group
• Formation Group
• Farallon Capital Management
• Capital Group
• Warburg Pincus
• KKR & Co
• NSI Ventures
|USD $550 million|
|• NSI Ventures
• DST Global
• Sequoia Capital