Grab commits $500m to Vietnam tech ecosystem
Grab, a Southeast Asia-focused ride-hailing app operator backed by a number of PE and VC firms, has committed to invest $500 million in Vietnam’s technology ecosystem in the next five years.
The Singapore-based company said it aimed to spur development of the local digital economy, especially in its core operational areas of financial technology, mobility services and logistics. Existing operations in the country include transport, food delivery and payments businesses.
The investment is expected to be applied to the launch of a number of new services and the hiring of R&D staff, while leveraging public-private partnerships. These efforts will be aligned with national development priorities, including various workforce and environmental sustainability targets.
“By aligning our business with the government’s socioeconomic development plan, we want to make a significant and meaningful contribution to Vietnam’s long-term socioeconomic growth, and support the country’s industry 4.0 ambitions,” Jerry Lim, country head of Grab Vietnam, said in a statement.
It comes one month after Grab pledged $2 billion to a similar five-year agenda in Indonesia using capital provided by SoftBank, which invested $1.5 billion in the company in March via its Vision Fund. In 2017, Grab committed $100 million to a three-year Myanmar expansion strategy also aimed at building out local digital infrastructure.
Expansion drives around the region have coincided with more than $9 billion in fundraising and a fierce rivalry with Indonesia-based competitor Go-Jek, which is said to have raised some $3 billion. Grab has also put capital to work via a VC arm launched last year, although it is not clear what role that unit could play in the Vietnam plan.
Grab began operations in Vietnam in 2014 and claims to be the country’s leading multi-service super app. It estimates that payments handled by local fintech partner Moca rose by 150% during the first half of 2019, with monthly mobile users growing more than 70%. GrabFood, which is billed as Vietnam’s top food delivery platform, saw gross merchandise value in the first half of the year grow 400%, with average daily orders hitting 300,000.
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