Gojek, Tokopedia Merge To Create Indonesian Tech Giant Valued At $18 Billion

Indonesian ride-hailing and payments giant Gojek and e-commerce platform Tokopedia have agreed to merge as GoTo Group, creating an Indonesian tech behemoth that could compete with bigger Southeast Asian rivals such as Grab and Sea Group.

Gojek co-chief executive officer Andre Soelistyo will lead the combined business as Group CEO. GoTo could be worth at least $18 billion based on historical valuations derived from funding rounds of the two entities in the past two years, the companies said in a statement.

GoTo is competing against Grab and Sea Group for supremacy in the race for the so-called super app in Southeast Asia, a market with a population of 650 million consumers. With over 100 million monthly active users, GoTo is Indonesia’s largest digital consumer platform offering e-commerce, on-demand and financial services.

“Today is a truly historic day as we mark the beginning of GoTo and the next phase of growth for Gojek, Tokopedia and GoTo Financial,” Soelistyo said in statement. “Gojek drivers will deliver even more Tokopedia packages, merchant partners of all sizes will benefit from strengthened business solutions and we will use our combined scale to increase financial inclusion in an emerging region with untapped growth potential.”

GoTo aims to tap Indonesia’s fast-growing middle class as well as its young and tech-savvy population. About half of Indonesia’s 270 million people have little or no access to financial services.

“The establishment of GoTo Group proves that you can believe in an ‘Indonesian dream’ and make it a reality,” Tokopedia cofounder and CEO William Tanuwijaya said in a statement. “Our goal has always been to build a company that creates social impact at scale, levelling the playing field for small businesses and giving consumers equal access to goods and services across the country.”

Gojek and Tokopedia were both founded over a decade ago to build a digital platform to tap into the then nascent e-commerce industry across Indonesia and Southeast Asia. The companies, which first worked together in 2015, handled 1.8 billion transactions last year with a gross value of $22 billion. The companies will continue to coexist as stand-alone brands.

GoTo will account for more than 2% of Indonesia’s $1 trillion economy, the largest in Southeast Asia, GoTo president Patrick Cao said in statement. “We are excited for the next chapter and look forward to our shared pursuit of innovation as a catalyst for inclusive growth.”

Gojek and Tokepedia have been in merger discussions since December after negotiations with rival Grab collapsed, according to media reports. Last month, Grab agreed to combine with black-check company Altimeter Growth Corp. for a potential listing in the U.S.

Established by businessman Nadiem Makarim in 2010, Gojek started as a call center fulfilling courier deliveries in Jakarta manually. Four years later, Makarim developed a mobile app with the backing of early investor Northstar. He left Gojek and 2019 and accepted a ministerial role in the Indonesia government.

Apart from Northstar, GoTo counts Chinese tech titans such as Alibaba Group, JD.com and Tencent as well as Internet behemoths Facebook and Google among its shareholders. The investors also include BlackRock, Capital Group, billionaire Masayoshi Son’s SoftBank Vision Fund 1, Sequoia Capital India, Singapore’s state-linked investment firm Temasek and Warburg Pincus.