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Asia's Grab Wants To Expand Beyond Taxi Hailing To A Whole Universe Of Services

CEO Anthony Tan shares his big dreams for the ride-hailing service—and explains how the Confucian way is helping him get there.

Asia's Grab Wants To Expand Beyond Taxi Hailing To A Whole Universe Of Services

[Photo: Flickr user Brian Kelley]

A curious thing has happened in the last 12 months: Companies in the automotive business, once an innovation sinkhole, have become part of the race for technological supremacy. Case in point: *Singapore’s Grab, which launched four years ago as a simple taxi-hailing app that promised riders in Malaysia safe transit home. (Tales of venal cab drivers robbing passengers scared both tourists and local residents.) Grab now also operates in Singapore, the Philippines, Vietnam, Indonesia, and Thailand.* It offers carpooling, ride-sharing, and motorbike transit, as well as delivery services in certain areas.

CEO Anthony Tan certainly believes Grab can be the leading automotive force in the region. "We bring the most customers," he claims, pointing to the 15 million downloads of his company’s app. Uber would also like to lead in these countries, but Tan has aligned Grab with China’s Didi Chuxing, India’s Ola, and Lyft, Uber’s chief American rival. (*Didi customers can already hail rides in the US via their Didi app*—by the end of this year, each service's app will have the same cross-company international reach.)

Perhaps more importantly, Tan touts his local expertise as a competitive advantage. After getting his MBA at Harvard, Tan worked for Tan Chong Motor, a leading South East Asian car distributor founded by his family. "We work with regulators the way we’ve been taught in my family business since I was a kid. We work with the Ministry of Transportation in an open, collaborative way. I think the Confucian way is to work with them hand in hand to build trust."

That cooperation can be extensive. Grab shares aggregated, anonymized ride data with both the Philippine and Indonesian governments, and works with them on regulations and city planning.

"Djakarta is four times bigger than New York," says Tan. "It is constantly getting bigger, and the government is constantly adding townships to it. Where should the highways and the arteries be built? How should the traffic flow? Our data can help with that, and our riders get better routes."

Motorbike service is another example of something that benefits from local expertise. According to Tan, the average commute into Vietnam’s Ho Chi Minh City is around three hours. A motorbike ride, which can skirt the congestion by taking side roads that might not be even mapped, can cut that time down to 45 minutes—which means drivers who are intimately familiar with those unmapped roads have a distinct advantage. Plus, the data from the ride augments Grab’s own mapping ability: Data mined from rides forms the basis of Grab’s proprietary routing service.

That routing edge could extend to the day when autonomous cars hit the roads of Southeast Asia. "In a city like Singapore, autonomous makes sense," he says, "and the government is very proactive."

In the rest of Grab’s territory, however, that day is far off. "In markets like Indonesia and the Philippines, there are absolutely no rules of the highway. So far, smart robotics haven’t been able to handle situations where people just run right out into the middle of the highway all the time," Tan says, laughing. "You may call this chaos. To us, it is an orderly mess."

Southeast Asia’s startup infrastructure is also slightly messy, not as fully developed as China’s. Tan claims Grab is "Southeast Asia’s fastest-growing tech company." Listening to him, you get the sense that ride sharing is just a Trojan horse; the real goal is to become the hub for anything in Southeast Asia that involves a cashless payment. Tan points out that for many Southeast Asians, paying for their Grab ride with their smartphone is an introduction to the very concept of cashless transactions. "It’s a 'wow' experience," says Tan. "Grab was the first app in the region to do this," he claims. "With most Asian consumers, the best you can expect is that he or she has gone online to buy a ticket at some point. Our system is linked to local banks across the six countries we serve."

How far will this take Grab? If you ask Tan, there are few limits. "So far the app has been downloaded onto 15 million mobile devices. There are 630 million people in South East Asia, with perhaps 150 million or 200 million smartphones. So that leaves hundreds of millions of people who will upgrade from their Nokia phones, as well. We can offer them many more services. We’re experimenting with last mile delivery. We’re doing social carpooling, where Facebook friends can meet up, boy-meets-girl. We can pick up your movie ticket or your food. We will roll out more and more micro-services that work on the platform."

Tan certainly has the same chutzpah as Uber CEO Travis Kalanick. He also lacks certain things Kalanick brings to this race, like a boatload of VC money (Grab has raised $680 million, according to CrunchBase, vs. Uber's $12.51 billion), global reach, and expertise running a startup.

"I’ve had to learn a lot. I didn’t know that it was going to be so difficult to build a fricking taxi app. I didn’t realize the level of AI, the predictability that was required, the pricing dynamics. I didn’t know how to build a team. There was a lot I didn’t know early on."

He’s learned well, and led Grab to four years of growth. But as he himself says, "We’re just beginning."

*An earlier version said that Lyft drivers could hail rides in Beijing. That function won't be available until later this year. The company is headquartered in Singapore.

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