Jack Ma Said to Explore Joining $1.5 Billion Grab Fundraising

  • Ride-sharing app is raising money to battle Uber, Go-Jek
  • Didi, SoftBank said to take part in current funding round

Lead Edge's Green Sees Big Opportunity for Grab in Asia

Alibaba co-founder Jack Ma may team up with SoftBank Group Corp.’s Masayoshi Son in a $1.5 billion investment in ride-hailing startup Grab, according to people familiar with the matter.

The investment would be part of Grab’s previously reported $1.5 billion fundraising, led by SoftBank and aimed at giving the Singaporean startup cash to battle Uber Technologies Inc. in Southeast Asia, said the people, asking not to be named because the matter is private. Didi Chuxing, the largest ride-hailing company in China and a Grab backer already, is also considering participating in the round, they said.

The Ma investment, which may come from either Alibaba Group Holding Ltd. or payments affiliate Ant Financial, would bring his competition with arch rival Tencent Holdings Ltd. to Southeast Asia. An alliance with Grab would let Ma market Ant Financial’s digital payment service, Alipay, to millions of riders in the region, where Tencent has already partnered with Grab’s biggest competitor to promote its own payment service.

Alibaba and Grab declined to comment. Didi didn’t respond to a request for comment.

China’s two internet giants are shifting their gaze abroad as growth in their home market slows and they seek to justify market valuations that are now among the highest in the world. They’ve focused particularly on Southeast Asia, a region with twice the population of the U.S. and the largest Chinese diaspora in the world. Tencent and Alibaba are entangled in a battle to lure more people to use their digital wallets both in China and internationally, and ride hailing is an important channel to help them win market share.

Read more: China’s Road to World Tech Domination Begins in Southeast Asia

The Singapore-based startup already has a partnership with Ant Financial, under which riders can use Alipay through the Grab app.

Tencent is said to be investing in Go-Jek -- another local rival to Uber -- and it’s also a major shareholder in Didi. If Didi decides to put more money into Grab, it would underscore how the Chinese ride-hailing company and Tencent have been driven into rival camps when it comes to investment. The pair back competing Chinese bike-rental companies.

Grab’s financing could be a record for Southeast Asia, eclipsing the previous watermark of $750 million it set in September, in a round said to have given it a valuation of more than $3 billion. SoftBank will provide most of the funding in Grab’s latest round. It’s said to be pledging about $1 billion, though it wasn’t clear if the money was coming from the Japanese company itself or its mega SoftBank Vision Fund.

Grab, also backed by Tiger Global Management and GGV Capital, and Go-Jek have locked horns in multiple cities in Indonesia, the region’s largest economy. Along with Uber, they’ve engaged in a cash-burning battle underpinned by their ability to raise funds and expand in one of the fastest growing markets globally.

— With assistance by Yoolim Lee

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