‘SoftBank Vision Fund companies are coming to Southeast Asia via Grab’

Chua Kong Ho (left most), SCMP tech editor, moderates a panel session at the China Conference 2018. Beside him are (L-R): Khailee Ng, managing partner of 500 Startups; Joe Tsai, chairman of SCMP Publishers, and executive vice chairman of Alibaba; Ming Maa, president of Grab; and Thomas Tsao, founding partner at Gobi Partners.

Japan’s SoftBank continues to see great potential in Grab as the ride-hailing firm moves to play an even greater role in Southeast Asia, according to its president Ming Maa.

Grab will bring the herd of companies backed by SoftBank’s US$100 billion Vision Fund into the region via tie-ups, said Maa this morning, speaking onstage at the South China Morning Post’s China Conference 2018 in Kuala Lumpur. Vision Fund’s portfolio includes the likes of e-tailer Flipkart, budget hotel network pioneer Oyo, and shared office space provider WeWork.

“We are not creating a unicorn farm but taking all the wonderful unicorns in the Vision Fund and bringing them to Southeast Asia,” he said. “We are working on many different things internally […] You will continue to see an explosion of partnerships in the next 12 to 24 months.”

Maa believes this strategy will work as long as the firms focus on localizing their services. Southeast Asia – as Grab has come to realize – is a complex region with different cultures, languages, and nuances. “When Grab first went in some countries, we had to teach our drivers how to use a smartphone and move from there,” he recalled.

SoftBank first bet on Grab in 2014, when it injected a record-breaking US$250 million funding into the startup. Since then, the Masayoshi Son-led firm has been investing in Grab’s subsequent rounds.

Grab also counts other companies like Toyota and Microsoft among its high-profile investors.

The company has been hard at work introducing new services as it aims to become the region’s leading “everyday app” with a wide range of online-to-offline offerings. Apart from rides, it also provides food delivery and courier services, and owns mobile wallet GrabPay.

Localization is the name of the game

Grab isn’t the only company that sees localization of services as the way forward in the region.

Agreeing that it’s never easy for companies to venture into new markets, Thomas Tsao, founding partner at Gobi Partners, who was also in the conference panel, said: “You need local knowledge and experience to succeed in Southeast Asian markets.”

Besides Singapore and Indonesia, Gobi has also lent its support to startups in the Philippines, teaming up with a local VC for a US$10 million fund.

Also in the panel was Joe Tsai, chairman of South China Morning Post Publishers and executive vice chairman of Alibaba. His advice: “To customize a product, you must have technology. The speed of launching the product is also key, which again requires technology.”

Understanding a market’s customers and regulatory framework will bring greater success, he added.

He also believes that having a local partner will make it easier to gain the trust of customers in a new market. That’s what Alibaba’s Alipay did by partnering with local payments firm Touch N’ Go when it forayed into Malaysia. The alliance enabled the Chinese tech giant to acquire local knowledge while offering its partner tried-and-tested technology, as well as global know-how.