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Hello readers,
A recurring topic in the conversations I’ve had with folks in the Southeast Asian startup space is the lack of exits that the region has seen. Aside from a few significant ones – think Sea’s initial public offering (IPO) on the New York Stock Exchange in 2017 – there hasn’t really been a showstopping exit that’s made us all sit up and pay attention.
It certainly seems like we’re holding our breaths, waiting to see which of our regional tech giants – especially the decacorns – will be the next to go public. And it seems that the time might be ripe for Grab to leave the stable and make its stock market debut.
Today we look at:
- Why Grab should IPO sooner rather than later
- How this startup is making investments in private market securities easier for individual investors
- Other newsy highlights such as how Lalamove’s fundraising efforts are going (spoiler: very well) and the Indian bourses’ approval of the Reliance-Future deal
PREMIUM SUMMARY
The perks of going public
Rumour has it that Grab may be exploring a listing in 2021. Whether it’s true or not, it certainly makes sense for the ride-hailing decacorn to go public in the near future, given the benefits that a listing could offer to the company.
- Dollars and sense: Public markets are awash with cash, and there has been particular interest in emerging market technology companies, such as Sea and Pinduoduo. Plus, IPOs enable companies to raise funds from a larger pool of investors. Access to more funds could be crucial for Grab, which needs cash to fuel its ventures into financial services such as “buy now, pay later” products and digital banking.
- Due date: There’s also extra incentive for Grab to go public sooner rather than later. Under the terms of its deal with Uber, the latter has the right to force Grab to buy back its shares – for at least US$2 billion – if Grab doesn’t list by March 2023.
- A question of how: What will the listing process look like for Grab? A direct listing would be on the cards, but the rise of special purpose acquisition companies (SPAC) in Southeast Asia could provide an alternative route. The SPAC process takes about six months, compared to the average of one year typically required of a traditional IPO – something that could give Grab an edge and bring it to market before a combined Gojek-Tokopedia entity.
Read more: Beyond FOMO: Why Grab should race to an IPO fast
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