Gojek’s $1.2b fundraise shows investor confidence despite tepid economic environment

Dear readers,

Despite the growing economic uncertainty, we must remain hopeful. The Covid-19 pandemic will eventually subside just like the 2003 SARS outbreak, which came under control after about a year. Similarly, the economy will also pull through and pick up again after this current crisis.

But before we see the green shoots of recovery, we should first weed out our pessimism and find seeds of good news whenever and wherever we can. In the past week, Gojek offered the most encouraging narrative from among the region’s startups.

The Indonesian unicorn has raised $1.2 billion in fresh funding, a sign that venture capital firms and private equity investors are selectively backing companies that present promising long-term opportunities.

Gojek co-CEOs Andre Soelistyo (left) and Kevin Aluwi / Photo credit: Gojek

Gojek CEO Andre Soelistyo told employees during an internal town hall meeting last week that the company’s transportation business has been profitable for “a few months.” While Soelistyo expressed concern about the impact of the Covid-19, he denied a DealStreetAsia story claiming that Gojek has retrenched staff.

Although the super app’s food delivery and payments platforms remain in the red, the funding news should be well-received by Gojek’s investors and employees, who have been buffeted by rumors of massive layoffs at the company in recent weeks.

In our latest visual story, we train the spotlight on the heavyweight investors in both Gojek and Grab. While these deep-pocketed financial backers can afford to wait for the archrivals to become profitable and launch an initial public offering, smaller shareholders are seeking to sell shares even at steep discounts in the secondary market, reports our chief correspondent Terence Lee.

Photo credit: AFP

Such secondary market shares sales do not typically reflect investors views of the companies. Rather, some shareholders would like to book profits, especially if they invested early in these unicorns. In fact, private exchanges provide an alternative exit strategy for investors who cannot wait for the startups to do an IPO, according to our fintech reporter Melissa Goh.

Aside from looking for these “green shoots,” we should help cultivate them by acting positively ourselves. And this is what Tech in Asia has been doing. While some startups are holding off on hiring, we are selectively bringing in fresh talent – at least in the newsroom. Earlier this month, we recruited Joseph Gan to expand our coverage of social media companies as well as agriculture and food technology startups. He’s a former broadcast journalist from CNBC and Channel NewsAsia who helped build AgFunder’s coverage in Asia and Latin America in the past year.

In his first story for Tech in Asia, Joseph features startups that are mitigating the growing problem of food waste across Asia. One such company makes beer out of bread, you can read the story here.

Outside of the newsroom, Tech in Asia is proceeding with our Product Development Conference in July. This will be our first-ever virtual summit.

For more insights about technology companies and the region’s startups, you can read the rest of our premium content below:

Long reads

• Uber considers suspending ride-sharing in India after US, Canada

• Two models emerge from latest wave of co-living startups in Indonesia

• Gojek mafia makes waves across Indonesian startup scene

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• Bringing electric motorbikes to Southeast Asia’s masses

• Q and A with a former Alibaba executive: Every crisis presents opportunities

Rising startups

• These are the most active investors in China’s startups

• 50 most recently funded startups in China

• 50 rising startups in India

• These are the most active investors in Singapore’s startups

• Oyo secures $807m from SoftBank, RA Holdings

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Speak to you again next week.

Cheers,

Jonathan
Editor-in-Chief