After a tumultuous year of speculation, it’s finally official. The die has been cast, and the fault lines of Southeast Asia’s digital landscape have settled into a new shape.
Gojek and Tokopedia, Indonesia’s two largest tech firms, last week confirmed their long-awaited merger to form GoTo. In doing so, the two companies have fortified their hold over Indonesia, a country with 270 million people and a growing consumer class.
GoTo creates a digital giant—the biggest private tech company in Southeast Asia. Gojek, founded in 2010 and valued at US$10.5 billion, covers transportation, instant deliveries, and a mature digital payments and financial services backbone—it’s a so-called super-app. Twelve-year-old Tokopedia’s e-commerce marketplace, valued at US$7.5 billion, contains millions of Indonesia’s small and medium enterprises (SMEs) and logistics infrastructure.
The merger is sending ripples across the world’s tech ecosystem. GoTo is now reportedly reportedly Reuters Indonesia's Gojek, Tokopedia to create biggest local tech group Read more raising a pre-IPO round, with a US$35-40 billion valuation. That puts it in the same ballpark as rival super app Grab, which recently announced announced CNBC SoftBank-backed Grab agrees to deal to go public in world’s largest SPAC merger Read more a merger with a SPAC SPAC special purpose acquisition company A SPAC is a shell corporation listed on a stock exchange with the purpose of acquiring a private company, thus making it public without going through the traditional initial public offering process. at a US$40 billion valuation.
GoTo and Grab are near-equals in terms of number of transactions, too: GoTo reported 1.8 billion transactions in its combined network in 2020, while Grab had 1.9 billion. In e-commerce, though, GoTo towers over Grab. Tokopedia’s marketplace adds 9.9 million sellers to Gojek’s 900,000 merchants. Grab has disclosed that it has two million merchants across Southeast Asia
It’s anyone’s guess what would have happened if Gojek had instead gone ahead with a merger with Grab, which was an option an option The Ken Grab and Gojek: a potential marriage of inconvenience Read more . It would have made the Indonesian ride-hailing leader part of a larger, regional entity. Grab operates in eight countries across Southeast Asia.
GoTo was ultimately the easier merger—a “marriage of equals” and a great cultural fit, according to analysts. Its business units continue to operate independently, with no major job cuts. The co-founders of each company get to remain leaders in their own domain.