Uber rival Grab raises $750M led by SoftBank at a $3B valuation

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Grab, the largest company rivaling Uber in Southeast Asia, has confirmed that it has raised $750 million in fresh capital.

This is the company’s Series F round, and it was led by existing investor SoftBank with participation from undisclosed existing and new backers, Grab said. One of those is almost certain to be China’s Didi Kuaidi, which reportedly made a commitment to this round, but neither side is confirming that right now.

A source close to the company confirmed that the round gives Grab a $3 billion post-money valuation. That’s consistent with our previous reporting, which pegged Grab’s pre-money valuation at $2.3 billion.

Grab operates in six countries in Southeast Asia and its previous raise was $350 million in August 2015. This new financing has been sometime coming, and it was reported that Grab was raising upwards of $600 million in August, with some media suggesting the total could reach $1 billion. That hasn’t happened but Singapore-headquartered Grab did claim that it has over $1 billion on its balance sheet courtesy of this new raise.

Grab said it 400,000 drivers on its platforms and it has seen over 21 million app downloads to date. In an announcement, the company added that it sees “up to 1.5 million daily bookings,” which a Grab spokesperson confirmed means ride requests not completed rides. Uber doesn’t provide business data for Southeast Asia so it is hard to compare them, but we previously reported that Uber is operationally profitable in parts of Southeast Asia and there seems to be little to choose between the two.

An arsenal of capital is clearly necessary when you are taking on Uber, but Grab did sketch out some areas of priority that it will focus on.

Indonesia, the world’s fourth most populous country and the largest economy in Southeast Asia, is top of its list. Grab CEO Anthony Tan said in a statement that he believes that Indonesia’s ride-hailing industry is worth $15 billion annually — that goes beyond taxi and cars and into motorbike taxis — which Grab offers there — and services such as food delivery, logistics, and more. Indonesia is no easy market and, alongside Uber, Grab is rivaled by GoJek, a motorbike taxi on-demand service that recently raised $550 million at a valuation of $1.3 billion.

Beyond a push into services, Grab is also looking to expand its ecosystem into payments. This summer it announced plans to make its in-app payment system — GrabPay — available to third-party services, and this new funding will go towards making that happen. The GrabPay push will initially focus on Indonesia, where Grab has partnered with national bank Mandiri, but it will also be extended into the company’s other focus markets, too.

Another more obvious area of focus is technology. Grab has R&D centers in Singapore, Beijing and Seattle and its priorities include refining its algorithm to help drivers become more efficient, building out its mapping data and technology, working on demand prediction and user targeting. Grab is also looking to add pooling to its existing vehicle categories, having launched its first pool option in Singapore nearly one year ago.

There’s no word on autonomous vehicles, however, which Uber is testing in Pittsburgh with a view to rolling out more fully. Self-driving cars aren’t just for the U.S. market though. Nutonomy is running testing in Singapore so you could argue Grab is already playing catchup or might need to get its checkbook out if it wants to enter the race.

“Grab has grown tremendously over the past year. This round of funding shows the confidence and optimism investors have in Grab’s market leadership and long-term potential in Southeast Asia,” Tan, Grab’s CEO, said in a statement.

“We are blessed to have great partners like SoftBank, many of whom have unparalleled track records of investing in leading internet businesses in emerging markets, and seeing those companies through to become the core of internet ecosystems in each market,” he added.

Despite much to be bullish about, Grab is up against a tough rival in Uber and in a market that shows little sign of profitability right now. We previously reported that the company was burning as much as $30 million per month in 2015. While Grab has consistently claimed that it has not touched its Series E round yet, it is looking at a long path to profitability in Southeast Asia. Likewise, Didi’s move to acquire Uber China — and, in doing so, take equity in Uber Global — throws questions on its global alliance with Uber’s other rival companies.

Nonetheless, this new funding is a major milestone for Grab, and the largest raise for a tech startup in Southeast Asia to date.