Google has added Grab and Go-Jek to its Google Maps platform in Southeast Asia to fuel the heated ride-hailing market, reports Tech Crunch.

Uber’s advantage over its competition was the fact that it was being integrated into Google Maps. However, this year, Google Maps added a slew of non Uber options onto its platform, with the latest being Grab and Go-Jek in Southeast Asia.

The option appears when a user has asked for directions to a place inside apps. The app will show the distance, location of the nearest vehicle and a price estimate. Clicking for the ride option will redirect the user to the Grab or Go-Jek application.

Google Maps has been helping people navigate the world for over a decade, and we’re excited to be able to make Southeast Asia more accessible through Grab’s affordable, on-demand local transport options. – Grab’s Press Release.

These new integrations comes at a very interesting time for Southeast Asia’s ride-hailing apps. Grab is raising a new round of funding at a valuation of $2.3 billion, with China’s Didi Chuxing and Softbank leading the investment of $600 million into the company. Go-Jek has also recently raised $550 million in funding. Although the latter is less globally known, it is the leading motorbike on demand app in Indonesia. The integration into Google Maps may also suggest that the startup is considering a further expansion into Southeast Asia.

The Google Maps app still prioritizes Uber over other options. However, this monopoly is very much like Google’s relationship with Uber itself, complicated. Uber has been dependent on Google Maps, but the company is reportedly spending $500 million to develop its own solution, which is reflected in its acquisition of a small US based maps startup. There have also been many reports that Google is working on an Uber rival of its own.

Perhaps by adding Uber’s Southeast Asia rivals, Grab and Go-Jek to its maps platform, Google is sending out a message of its own.

A version of this appeared in Tech Crunch on August 9. Read the full version here.

Go-Jek, the on-demand motorbike taxi service in Indonesia has raised $550 million in funding, reports Tech Crunch.

The deal will value Go-Jek at $1.3 billion.

The company plans to spend the money growing its services businesses, and continue to compete with fierce rivals in Indonesia. Sources suggests that this round will not fund an expansion outside of Indonesia.

The startup’s existing investors include Sequoia Capital, DST Global and Singapore based NSI Ventures.

The deal makes Go-Jek one of the few unicorns in Southeast Asia. Other tech companies valued in excess of $1 bullion include Garena ($3.75 billion), Grab ($1.6 billion) and Lazada ($1.5 billion).

Go-Jek was founded 2010, but didn’t take-off in a big way until 2014. It then accelerated following the launch of its mobile app in early 2015.

Go-Jek claims 200,000 motorbike drivers in its fleet across Indonesia to serve the world’s fourth largest country with a population of more than 250 million people.

The company is best known for hailing motorbike taxis on demand, a type of transportation popular in parts of Southeast Asia where heavy urban traffic makes two wheels faster than four.

Demand is particularly high in Jakarta, which is home to some 30 million people and is one of the planet’s most congested cities.

Go-Jek has stated that it processed 20 million booking requests in June 2016, around 667,000 per day.

Go-Jek Biggest Competitors

Grab introduced GrabBike to Indonesia last year, and Uber’s Ubermoto launched in Indonesia this year. However, Go-Jek is acknowledged to be the market leader.

Internal documents viewed by TechCrunch show that Go-Jek had $104 million in cash on its books as of March and that it spent $73 million over the previous six-month period. This new raise is hugely important if it is to continue to compete with its cash-rich rivals on subsidies and marketing.

The news of the fundraising has come at a time for ride-hailing services as Uber and Didi are currently tied up in a complex buying bid, with latest news announcing that Didi has invested in Grab’s newest round of funding.

A version of this appeared in Tech Crunch on August 4. Read the full version here.

China’s Didi Chuxing and SoftBank Group Corp. are leading a new round of funding in the Southeast Asian ride-sharing service Grab that could exceed $600 million, according to Bloomberg. Grab is also seeking to raise a separate $400 million in the following weeks.

The talks signal that the truce between Didi and Uber Technologies Inc. in China this week is far from a global accord. Didi bought out Uber’s operations in the country and became a shareholder in the US company but the Chinese firm’s investment in Grab shows it will continue to clash with Uber in Southeast Asia and perhaps other regions.

Now Didi will be able to put the reserves in new growth markets like Southeast Asia and back a player they believe has a strong chance.

Grab CEO Anthony Tan said he expected Uber to concentrate on the relatively untapped Southeast Asian market after agreeing to sell its China business. Grab currently operates in 30 cities across six countries, and was valued at $1.5 billion in 2014. It is not clear yet what the company’s current valuation will be.

The alliance that Didi forged last year with Grab also included India’s Ola and the US’s Lyft Inc. It’s unclear what impact the Didi-Uber deal will have on the other members of that tie-up.

It seems that Didi is making a very complex, interwoven play at the ride hailing app market, no official word has been announced from Didi, regarding the operations of both deals. Didi’s move in Southeast Asia is perhaps a counter move to fight against Uber, which is poised for a more aggressive strategy in Southeast Asia following the sale of its business in China.

A version of this appeared in Bloomberg on August 3. Read the full version here.

Over the weekend, 11 vehicles were seized by police, local media reported. This involved cars from all three app-based ride-hailing services that operate in Jakarta – Uber, Grab, and Go-Jek’s Go-Car. A traffic police official told Detik the cars were taken because the drivers didn’t carry the required licenses.

License to drive

Ever since Uber-like ride-hailing services became popular in Indonesia in 2015, authorities have struggled to lay out rules for them.

Some demanded that ride-sharing apps bow to the same regulations as metered taxis. More progressive voices argued new rules must be formed for ride-hailing, because the system resembles car rentals rather than metered taxis.

In March, a truce between ride-hailing apps and the ministry of transportation was reached, with the latter passing a new regulation. It requires Uber and its competitors to have their cars go through a road safety test, and register them as commercial vehicles, for example through a car rental company.

The companies were given a period of time to comply. The latest deadline is said to be October 1.

Less tolerance

This raises the question why the raids took place now, some months before the compliance deadline.

It looks like authorities are enforcing a stricter interpretation of the “tolerance period.”

A spokesperson for the ministry of transportation yesterday confirmed that the tolerance time means only vehicles that have already obtained all necessary licenses can operate, not those still in the application process.

Only about 100 ride-hailing vehicles, from all three companies combined, have already fulfilled all demands, the ministry said.

All this indicates that the struggle is far from over for ride-hailing apps in Jakarta.

It’s possible the stricter enforcement has to do with the appointment of a new transportation minister on July 27. Budi Karya Sumadi has yet to come out with a position on the controversial issue.

Over the weekend, he told media that he plans to invite Uber, Grab, and Go-Jek this week to discuss the matter.

A version of this appeared in Tech in Asia on August 1. Read the full story here

Uber Technologies Inc. will sell its China business to Didi Chuxing, the dominant ride-hailing service in the country, reports Bloomberg. The deal ends a costly battle between the two companies, which competed for customers and drivers.

The valuation of the combined business will be $35 billion. Investors in Uber China, an entity owned by San Francisco-based Uber, Baidu Inc. and others, will receive a 20% stake in Didi and Uber will continue to operate its own app in China for now.

In addition to Uber selling its Chinese subsidiary, the complex deal involves Didi making a $1 billion investment in Uber. Both sides declined to comment.

Last year, China’s ride-hailing leaders Didi and Kuaidi joined forces. The merged company Didi Chuxing brought together backers Alibaba Group Holding Ltd. and Tencent Holdings Ltd., the country’s most valuable internet businesses. Apple Inc. joined in this year with a $1 billion investment in Didi. Uber simply could not compete with the power house.

Both Uber and Didi have been spending significantly to compete in China. Uber has lost more than $2 billion in the country.

Getting to profitability is the only way to build a sustainable business that can best serve Chinese riders, drivers and cities over the long term. Neither Uber or Didi has turned a profit in China.

The purchase of Uber’s China business may complicate Didi’s alliance with other ride-hailing startups around the world. Didi had agreed to work with the US’s Lyft Inc., India’s Ola and Southeast Asia’s Grab to create a global force to take on Uber.

 The impending deal is a victory for Didi and underscores how the ride-hailing business favors domestic players.

While Uber will walk away from operations in China, it is taking a significant stake in the largest player in China. By recovering from its massive losses in China, the move will potentially help Uber clear the path for an eventual IPO. This deal shows that sometimes if you can’t beat them, it’s better to join them.

A version of this appeared in Bloomberg on August 1. Read the full version here.

Anthony Tan, group chief executive and co-founder of ride-hailing service Grab said his company will be in Indonesia for the long term to provide multi-platform services to help solve the country’s perennial problems related to inadequate transportation infrastructure.

Grab operates in 30 cities in six countries in the region – Indonesia, Singapore, the Philippines, Malaysia, Thailand and Vietnam. The company competes against United States-based ride-hailing service Uber and local app-based service Go-Jek to provide services using private cars, taxis and motorcycle taxis.

Sustainability means removing subsidies

Indonesian drivers who are partners of Grab, like many other ride-hailing services, receive subsidies from their companies to ensure that they earn enough money, while also keeping customers happy with affordable fares. But Tan said he fully realizes that Grab must gradually remove the subsidies.

“How do you build a sustainable business model? The only way [to operate] without subsidies is to ensure [there are] many jobs for drivers,” said Tan, who prior to founding Grab, was the head of supply chain and marketing at Malaysia-listed automotive giant of Tan Chong Group. Tan appeared happy when he explained that his company’s business model did not involve burning huge amounts of cash to attract regular users.

“How much cash someone can burn is not a good relevant example to building a long-term solution. We have to solve a long-term problem,” – Grab Co-Founder

GrabBike in particular, he said, has seen 300%growth in its business since January, despite a 50% cut in its fare subsidies.

The key aspects of the business are technology and people

In his illustration of how he prioritizes Grab’s spending, he said, “if we have $100, we have to put $90 in IT,” referring to Grab’s back-end technology business that includes its consumer application team, application design team, database team, engineering and infrastructure engineering. He also mentioned Grab’s partnership with the World Bank to provide real-time traffic data to improve the startup’s mapping technology.

Tan said Grab is also not forgetting about security aspects. He was proud to reveal that he snatched his IT team from Palantir Technologies, an American software and services firm, which has served clients, including the US government and the Central Intelligence Agency (CIA), National Security Agency (NSA) and Federal Bureau of Investigation (FBI).

Grab is not shaken by regulatory challenges

Offering what he calls “constructive disruptive” technology, Tan is fully aware that Grab must maintain a good relationship with the government and calm discontent among traditional players in the industry who feel that their businesses are under threat. Protests have occurred in Indonesia, with people employed in the taxi industry, and those working as traditional motorcycle taxi, or ojek, drivers, accusing the company of introducing unfair business practices.

The deadline for this controversial regulation, expected to discourage driver partners from participating in the business, is Oct. 31 this year. When asked about the regulatory hurdles, Tan was largely unshaken by the challenge. “In the end, I believe the Indonesian government wants the best for the people of Indonesia. In the higher principle, I believe you are aligned, it is no longer me against you […] we both want to help Indonesian people have a much more efficient transportation system,” he said.

A version of this interview appeared in Jakarta Globe on July 26. Find the full version here