Want to know what new businesses Grab is thinking of going into next? Look at what startups they are investing in or helping to build.
When Anthony Tan, co-founder and chief executive of the Singapore-based firm stood onstage a year ago at a conference in Singapore to announce the creation of a venture capital arm, he called it a “pay it forward” moment.
The idea was to use the platform as a “launch pad” for startups in the region and to “mentor and share the huge mistakes that we have made so that you don’t have to,” he said.
One year hence, Grab Ventures has invested in startups like Helpling, an online home-services platform, an online-ticketing service in Indonesia called BookMyShow, and Sejasa, a home improvement and maintenance services marketplace.
The venture arm just began its second batch of startups for its Velocity programme, where it is putting 10 firms in the “scale-up stage” through a 16-week boot camp where their services and products will be tested out on the Grab platform as “proof of concept, according to Chris Yeo, head of Grab Ventures.
Whereas the first batch focused on consumer-facing businesses, the current crop of startups in the programme are focused on farmers and small businesses.
“You can’t do everything in-house,” said Yeo over a morning coffee at the Grand Hyatt hotel in Wan Chai, Hong Kong, where he was attending the Rise tech conference. “We focus on our core businesses, the rest we partner.”
By nurturing an ecosystem of startups, Grab aims to eventually create 100 million “micro entrepreneurs” in the South-East Asia region, or gig-economy workers that have been able to benefit from working on a Grab service.
Building a well-rounded ecosystem of services allows companies like Grab to obtain troves of valuable user data that can be used for targeted advertising or understanding users’ needs, to offer better services. Offering a variety of services that are part of everyday life also makes the platform more sticky, ensuring that users remain active while also serving as a higher barrier of entry for potential competitors.
That is also the way China’s most famous Internet giants, Baidu, Alibaba and Tencent, have been operating. Between them, the BAT companies have invested in hundreds of firms every year as they acquire talent, expertises and businesses to plug into their respective ecosystems. Alibaba is the owner of the South China Morning Post.
Citing the example of CloudKitchen, a concept for delivery-only restaurants, Yeo said that Grab was able to provide orders for the eateries through its app, and as the landlord, can reduce the cost for operators because its main aim is not to extract the highest rent but to enrich the offerings for its delivery service. – South China Morning Post
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