Google confirms investment in Indonesian ride-hailing firm Go-Jek

SINGAPORE: Google has made its first ride-hailing investment in Asia by pumping money into Go-Jek, as the Indonesian start-up and deep-pocketed rivals rapidly expand their app-based services and digital payments in Southeast Asia.

The funding deepens Google´s commitment to Indonesia´s internet economy," Caesar Sengupta, a vice president at Google said in a company blog on Monday.

The announcement by Alphabet Inc´s Google comes two weeks after sources told Reuters that Google and Singapore state investor Temasek were among those investing in Go-Jek as part of a $1.2 billion fundraising round.

Rivals Grab and Uber are backed by Japan´s SoftBank Group , while Go-Jek has secured investments from Chinese technology giants Tencent Holdings Ltd and JD.com Inc .

Google´s blog did not specify how much Google is investing but two sources had told Reuters that Google was investing about $100 million.

Ride hailing firms are investing tens of millions of dollars to expand their digital payment systems and are also seeking to allow their users to pay for third-party services.

With more than 133 million people online, Indonesia is home to the fifth largest population of internet users in the world but half of the country´s population has yet to connect to the internet, Google´s Sengupta said.

Both Grab and Uber are expanding in Go-Jek´s home market, which is Southeast Asia´s most populous country and where locals are keen to lap up an array of mobile-based services.

Southeast Asia is the world´s third-biggest ride-hailing market after China and the United States.

Go-Jek, a play on the local word for motorbike taxis, delivers everything from meals and groceries to cleaners, masseuses and hairdressers across Indonesia´s capital city Jakarta, all at the touch of a smartphone app.

The company, which began as a ride-hailing app for motorcycle taxis, was set up by Nadiem Makarim, a graduate of the Harvard School of Business and a former associate with McKinsey, who has quickly become a poster child for start-up success in Indonesia.