SINGAPORE: Grab is looking to raise another US$2 billion this year to ramp up expansion, its CEO Anthony Tan told Reuters, only weeks after announcing more than US$4.5 billion of funding in what has become Southeast Asia’s largest round of private financing.
The mega funding comes as Grab rolls out an aggressive strategy to expand its bouquet of services, from transport to food delivery and payments, racing Indonesia’s Go-Jek to become an app-for-everything in Southeast Asia, home to about 650 million people.
Grab, which is backed by Japan’s SoftBank, expects to invest a significant portion of the funds in Indonesia, it said in a statement later. Reuters reported the funding target earlier on Monday.
“We basically received a very strong vote of confidence. And Masa shared that SoftBank is very happy with Grab and SoftBank will provide unlimited support to power our growth,” Tan said, referring to SoftBank founder and CEO Masayoshi Son.
“SoftBank continues to believe that Grab deserves its unwavering support,” a SoftBank spokeswoman said.
Funding, to be raised from strategic investors, including SoftBank, will be a mix of debt and equity, Tan said.
Grab’s ongoing massive financing round started soon after it bought the Southeast Asian operations of US peer Uber in March last year.
The Singapore-headquartered firm, like its regional rival Go-Jek, has been raising billions of dollars to bring ride-hailing, food delivery, e-commerce and banking to a populous region with a growing number of consumers that use smartphones to commute, shop and make payments.
Both companies started out in ride-hailing and have since amassed millions of users with cut-rate prices.
Backers for Go-Jek include Temasek Holdings, Tencent and Alphabet Inc’s Google.
Grab counts Toyota, Microsoft, China’s Didi Chuxing and Hyundai among its backers.
People with direct knowledge of the matter said Grab has raised about US$8 billion since its launch almost seven years ago.
Last month Grab’s president Ming Maa, a former SoftBank executive, said the ride-hailing company was considering raising more funds in its ongoing financing round, in which the SoftBank Vision Fund has invested US$1.5 billion.
Tan said: “With the amount of funding we have raised, and the support from strategic investors like SoftBank, we are so well-funded to execute on our expansion and investment plans, so there is really no need to IPO.”
Grab wants to make at least six investments or acquisitions this year and plans to add 1,000 tech staff globally, Tan said.
In Singapore, it will double staff to 3,000 when its US$134 million headquarters is complete by the end of 2020.
SoftBank’s support will help Grab to “grow very aggressively this year across our verticals – transport, mobility, food and payments”, Tan told Reuters in an interview.