An Uber for Motorcycles and So Much More
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Travel to Indonesia these days and you won’t see many Americans walking around outside of areas that are frequented by expats, like (shudder) Bali. Well, they’re really missing out, because Indonesia is an amazing place to visit. With more than 17,000 islands, Indonesia has the second-longest coastline in the world after Canada and is the fourth largest country in the world. With a population of 264 million people (that’s just over 80% as big as ‘Murica,) it has less than one-fifth the land mass. This means that things in large Indonesian cities are tight. Traffic is horrendous, and the use of scooters to get around more quickly just makes a whole lot of sense. When it comes to countries with the most scooters per household, Indonesia takes third place with the top-5 countries seen below according to Statista:
If we look at simply the total number of motorcycles in Indonesia, that number has been rapidly climbing over time to reach 111,470,878 units. Compare that to just 15,424,890 cars and it’s easy to see why in countries like Indonesia, an Uber for motorcycles makes a whole lot more sense than an Uber for cars. We air-dropped one of our MBAs into Jakarta to have a look around at some local AI startups, and he was surprised to see that everywhere you look on the streets of Jakarta, all you see is a sea of green helmets belonging to Indonesian startup GO-JEK and another company they’re locked in vicious competition with, Singapore startup GrabTaxi. In this article, we’re going to focus on Indonesia’s first unicorn, GO-JEK.
An Uber for Motorcycles. And More.
Founded in 2010, Indonesian startup GO-JEK was first conceived as a motorbike delivery and transportation service coordinated via a call center, and has since taken in $3.3 billion in funding to develop a “first-in-the-world kind of super app that encompasses all your daily transactional needs.” The name of the company is a play on the word “ojek” which is the name for a two-wheel motorcycle taxi (what Americans might refer to as a scooter) that ferries people around in much the same way a taxi does.
Update 05/11/2021: Gojek has raised $300 million in fresh funding as it moves toward a big merger. This brings the company’s total funding to $5.3 billion to date.
The founder of GO-JEK, Nadiem Makarim, discovered that ojek drivers spend most of their time waiting for customers, while customers waste time walking around looking for an available ojek. In 2015, the company released an app to sort that situation out, an app that has now been downloaded 108 million times. Most of our readers hail from America, and most of our readers probably have used an Uber, so they’re familiar with how GO-JEK’s app works. What might not be so obvious, is just how different the GO-JEK platform is compared to the Uber platform.
Same, Same, But Different
In order to really understand something, you need to get your hands dirty. In Indonesia, that means having a meal. No need for utensils when you can just grab up all that spicy deliciousness with your bare fingers and stick it straight into your gob. Our MBA decided to download the app and see if he could get some delicious Indonesian food sent right to his North Jakarta hotel room – following a suspiciously expensive massage he charged to the company card. Installing the GO-FOOD app took about 30 seconds, inputting a phone number and email, about 30 more seconds, and that’s it. From downloading the app to when Achmad walked through the door with the below deliciousness took approximately 15 minutes:
For taking time out of his day to get on a scooter, go purchase the food, and hand-deliver it to some fat American who couldn’t speak one word of the Indonesian language (it’s called “Bahasa Indonesia” by the way), Achmad charged a whole 13.8 cents as a delivery fee (that’s in USD).
Throughout our time in Jakarta, we continued to use the app to order even more food, and the experience was largely the same. Once a driver knew our Bahasa skills were non-existent, they would quickly switch to English. One driver who spoke good English, handed over the food and started to sell us on how using GO-PAY could save us money. Amazed by what we had just seen, we decided to look at what else we could do with the app. As it turns out, there’s not much you can’t do with the GO-JEK app.
GO-JEK, Go-Everything
If we just start by looking at what the app has on the opening screen, the usual suspects exist. There is GO-RIDE which is the motorcycle hailing app, GO-CAR which lets you hail cars in much the same way Uber does, and GO-BLUEBIRD which lets you hail taxis. (Presumably, that was the easiest way to keep the local taxi mafia from revolting.) Then there is GO-FOOD which we mentioned above, GO-SEND which lets you send packages places, and GO-DEALS which is a great way to sell you stuff that’s on sale.
Then there is GO-PULSA which lets you top up your mobile data, and the aforementioned GO-PAY which lets you pay for everything on the platform and also provides the ability to pay by scanning a QR code or by sending money to someone’s telephone number who also uses GO-PAY. All the while, you’ll be collecting GO-POINTS. The payment features are extremely slick, and have more functionality than we’ve seen in other developed market apps. When you click “More,” the list of things you can do grows:
Need a massage? There’s an app for that called GO-LIFE. Not only can you get a masseur or masseuse sent to your door in under an hour (GO-MASSAGE), you can also get your laundry picked up and delivered back to you clean (GO-LAUNDRY), and even have a housekeeper sent over to clean up the mess you made eating while eating some delicious nasi goreng (GO-CLEAN). You can get groceries delivered (GO-MART), movie tickets delivered (GO-TIX), drugs delivered to your door (GO-MED), you can pay bills like power or internet (GO-BILLS), and you can even get someone over to do your nails and makeup (GO-GLAM) or fix your air conditioner if it’s broken (GO-FIX). The ability to do all these different things with the app is one of the things that sets GO-JEK apart from their biggest competitor, GrabTaxi.
GO-JEK vs. GrabTaxi
The GoJek drivers are easily spotted by the green helmets they wear, and their green jackets. But not all that is green is GO-JEK. There’s another company competing with GO-JEK head-to-head on the streets of Jakarta called GrabTaxi.
| Company | Valuation (billions) | Country | Select Investors |
| GO-JEK | 1.8 | Indonesia | Formation Group, Sequoia Capital India, Warburg Pincus |
| GrabTaxi | 11 | Singapore | GGV Capital, Vertex Venture Holdings, Softbank Group |
While competition may be fierce at the corporate level, we didn’t see any sort of competition at the street level. In fact, we observed some drivers who carried around both uniforms, perhaps taking an opportunistic approach to the whole thing. One of these lads switched his uniform so we could take this picture – a juxtaposition of the two companies side by side:
In speaking with GO-JEK, they talked about how they’re working on using the drivers’ income streams as a new credit score of sorts that lets them begin offering services like micro-financing or insurance. These value-adds will serve to further lock in drivers, and there’s also the nationalistic notion that one firm is Indonesian and one firm isn’t.
It’s clear that being an Indonesian firm, GO-JEK has an advantage in how they are perceived locally. It’s not just that though, it’s also that they are benefiting their country. We pulled the following from Wikipedia, which we can only assume was vetted by the posh PR firm they have working to carefully craft their public image:
A research study reports that the average income of full-time driver partners (Rp 3.48 million per month) is 1.25 times higher than the average minimum wage in Indonesia (Rp 2.8 million per month). The average income of driver partners (Rp 3.31 million) is higher than professional employees in general (Rp 3.10 million for transportation sector employees; Rp 2.34 million for industrial sector employees; Rp 2.66 million for staff employees)
The drivers we talked to all seemed pretty stoked to be working for GoJek, but to be fair, they didn’t seem to care much who they were driving for. When money is hard to come by, you can expect people to be mercenaries.
The competition between these two firms is so interesting that it will probably end up as a future case study for tomorrow’s MBA programs. In May 2018, GO-JEK announced a $500 million investment in its international expansion strategy. The company will enter Vietnam, Thailand, Singapore and the Philippines, starting with ride-hailing, then further replicating the multiple-service business model offered in Indonesia. That’s not going to be easy. In places like the Philippines, Grab is firmly entrenched. Many local taxis use the Grab app, and arriving at the Manila international airport you’ll be greeted with a giant billboard outside at arrivals telling you to download Grab. When it comes to expanding internationally, GO-JEK has their work cut out for them.
Conclusion
We were rather vexed when trying to classify GO-JEK into a particular category as a company. They’re a bit of “green technology” in that they help reduce pollution by optimizing vehicle utilization. They’re a bit of “fintech” in that they have a mature payments platform. And they’re a bit of “computing” in that they have a heavy focus on engineering. In the end, it doesn’t really matter where we classify them, because the company is accomplishing some amazing things.
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