GoTo’s on-demand segment nears its profitability destination

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Hello reader,

It’s a marathon, not a sprint.

I feel that often, we look at things as needing to be done as soon as it’s feasible to. Maybe it’s some sense of ambition or competition that drives us to push harder and get the results we want quicker.

That said, unless you’re Usain Bolt or Eliud Kipchoge, you’re most likely not going to achieve your goal in record time. In fact, in some cases, just reaching your goal at all can be considered an achievement.

This applies to many startups that have taken a difficult road to profitability. About a decade ago, many superstar firms like Grab and GoTo Group came out guns blazing, looking to grow their user base and revenue as quickly as possible. Once their sights turned to profitability, however, things slowed down considerably.

Today’s story takes a look at GoTo’s on-demand services unit as it teeters on the edge of profitability, a long journey that’s taken it years to reach.

Today we look at:

• GoTo’s on-demand segment close to tasting profitability
• The 50 Indian startups that have raised the most funding
• Other newsy highlights such as Singapore developing Southeast Asia’s first large language model and a new tech ecosystem from Hub71

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The brink of profitability

Image credit: Timmy Loen

It’s taken over a decade, but GoTo Group’s mobility and food delivery segments are close to being in the black. The fact that it took this long shouldn’t come as a surprise – it’s faced tons of twists and turns as well as competition during that time. Hitting this milestone would serve as a positive signal of better times to come.

• Closing the gap: In Q3 this year, the on-demand segment’s adjusted EBITDA loss stood at US$3.1 million, 95% lower compared to Q3 2022. According to a previous forecast, this vertical is likely to turn a profit by Q4 2023.
• Rapidfire: Over the course of 2023, Gojek introduced several new transport-related solutions, with the aim of managing its costs while growing its market share among price-conscious consumers.
• Still a ways to go: That said, the firm is still operating at a loss at the group level. To further drive profitability efforts, it’s looking to reduce reliance on third-party marketing tech and suppress incentive costs.

Read more: GoTo’s on-demand segment charts its roadmap to profitability

India’s tech superstars

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