When Grab drivers in Ho Chi Minh City gathered late last year to protest against the ride-hailing company’s new fee structure, Nghia went instead to his other job, cutting cloth at an apparel factory. He had been driving for Grab for a few years, but even if he was free to join the demonstration, he wouldn’t have. “If I spoke up, I’d get nothing,’’ Nghia said.
In December 2020, drivers reported that the commissions that Grab Vietnam takes from them suddenly increased, from around 20% to nearly 30% on its motorbike service GrabBike, and even more on GrabCar, its taxi offering. The change came after the Vietnamese government had abruptly increased an existing tax on ride-hailing firms. Many drivers felt that Grab had passed the burden onto drivers and passengers, although the company says that this was a misunderstanding and that drivers’ commissions did not change, but that the new tax was added to fares, then deducted from drivers’ takings at the same time as the commission.
Nghia, a 31-year-old migrant from the Mekong Delta region in southern Vietnam, who asked to be identified by only his first name, started driving for Grab because he heard that he could earn more through the app than its competitors. Grab is one of several venture-backed firms vying for customers in Vietnam. The country’s fast-growing and rapidly digitizing economy has opened up a new frontier for tech companies in Southeast Asia.
Over the past few years, Grab and other ride-hailing players like Gojek Vietnam, owned by the Indonesian unicorn Gojek, have burned millions of dollars in investor cash trying to attract price-sensitive Vietnamese customers and capture as much market share as possible. The strategy included offering steep discounts to consumers and generous incentives to drivers, who work as independent contractors with few labor protections.
The problem is that now their investors are eager to turn a profit, and the well of cash is starting to dry up. In Vietnam and other Southeast Asian countries, like Indonesia, Grab and Gojek had been raising prices for passengers before the Covid-19 lockdowns drastically cut the number of people using ride-hailing apps. Gig workers on the platform said that they felt squeezed before the pandemic, and more so during it.
But the two companies are also part of a pattern that started emerging around the world long before the pandemic. Enormous venture firms, most notably the Japanese mega-fund SoftBank, have poured billions into startups with the express purpose of winner-takes-all domination. Often, when it comes time to actually make money, it’s workers at the bottom who bear the burden.
For Nghia, this has resulted in a one-two punch of fewer rides and lower fees, making driving for Grab barely worth his time. “Driving for a day, I don’t earn as much as people selling lottery tickets,” he said, referring to the roadside hawkers that are common in Ho Chi Minh City. “I have only been making around 200,000 dong [$8.70] a day this year, working from 7 a.m. to 9 p.m., not to mention the money I have to give back to Grab.”
Drivers aren’t the only ones unhappy with the ride-hailing firms. SoftBank, Grab’s biggest backer, is getting tired of Grab and Gojek “bleeding a lot of money,” according to an investor with knowledge of both companies, and wants the two to merge. The reason is that they have fought their way into an expensive stalemate across Southeast Asia. Both Grab and Gojek have become multi-billion-dollar businesses by expanding into other services, though neither has yet turned a profit. While investors have continued to back them in an effort to build de facto monopolies, neither company has found a decisive advantage, and patience is wearing thin.
If a merger doesn’t happen, Gojek is reportedly in talks with another Indonesian unicorn, the e-commerce company Tokopedia, while Grab has reportedly selected banks to explore an initial public offering in New York. Grab and Gojek did not respond to repeated requests for comment.
Gojek, Grab, and Tokopedia are enormous acquirers of technology and talent, whose gravity shapes the entire landscape. If they do consolidate, the effects are likely to ripple across the whole region. “If Gojek and Grab did the merger, the two organizations would have an unassailable monopoly on ride-hailing services in Southeast Asia,” one investor with knowledge of negotiations between the two companies told Rest of World. (Like all venture capital sources in this story, they spoke on the condition of anonymity.)
Labor groups worry that, if a merger were to happen, drivers would have less leverage than ever before. “They can control many things, monopolize the system and so on,” said Taha Syafariel Baraqbah, acting chairman of Indonesia’s Online Drivers’ Association, who goes by Ariel. “Of course we are afraid and feel that the conditions will be even more arbitrary.”

Gojek was founded in Indonesia in 2010 by Harvard Business School graduate and former McKinsey consultant Nadiem Makarim and his high school friend Michaelangelo Moran. Two years later, Grab was launched in Malaysia by two other Harvard graduates, Anthony Tan and Tan Hooi Ling. They later relocated the company to Singapore, in 2014.
Both startups attracted big-name investors, like Sequoia India and Golden Gate Ventures, which were lured by the tantalizing opportunity to reach consumers in Southeast Asia’s populous and increasingly prosperous markets. As Grab and Gojek continued to grow, so did the scale of their funding rounds and backers. SoftBank invested in Grab in 2014, while the Singaporean state investment fund Temasek and the Chinese tech giant Tencent took stakes in Gojek soon after. In total, Grab has raised more than $12 billion, while Gojek has raised around $5 billion, according to the database Crunchbase.
Ride-hailing was an easy business to get into, since the existing transportation sector was dominated by traditional taxi companies, which had inflexible business models. There “was an obvious inefficiency and a market gap where you could come in and undercut the incumbents,” said Nitin Pangarkar, a strategy and policy professor at NUS Business School in Singapore. “The transport business was an asset-light model,” he explained, in that the drivers owned their own cars and motorbikes, and “it was a model that had been tried out elsewhere.”

To attract customers, Grab and Gojek spent heavily on deep discounts, eschewing profits in an effort to beat out the competition. “Ride hailing, definitely, was a money loser,” Pangarkar said. “That was because these crazy venture capitalists were willing to fund these price wars.”
Over the past few years, Grab and Gojek have expanded across Southeast Asia and begun to broaden the scope of their services, adding food delivery, groceries, payments, and logistics. In Indonesia, Gojek bought a stake in a bank, while in Singapore, Grab partnered with a telecommunications company to bid for a digital banking license. Today, Grab and Gojek are no longer just loss-making ride-hailing companies — they’re sprawling conglomerates that convert investor cash into user numbers.
Even where ride hailing has become profitable in individual countries, the companies have reinvested into expanding into other business lines.
One early Gojek investor told Rest of World that the appeal of ride-hailing was that it promised to create a base of regular users, who could then be leveraged into other businesses, like food delivery and e-commerce. If they used enough services regularly, the thinking was that they would no longer be tempted to switch to a rival platform, no matter how many discounts competitors offered. Once they had captured consumers, Gojek and Grab could start increasing prices and move toward profitability.
“These businesses … can be very profitable, because essentially, they become monopolistic,” the Gojek investor said. “We haven’t reinvented the wheel, this is just monopolism in a different form.”
Investors in both Grab and Gojek told Rest of World that they are no longer confident either will ever become a quasi-monopoly on its own. Indonesia is by far the biggest market in the region, and Grab and Gojek are still fighting to dominate it, though Gojek has a slight lead. Grab is ahead in Vietnam, Malaysia, and the Philippines — all smaller markets unlikely to offer the scale that would excite investors. Neither has succeeded in building a single, pan-regional super app.
Since coworking giant WeWork imploded in 2019 after raising more than $20 billion, venture capitalists have begun questioning the winner-takes-all approach, which requires essentially burning large sums of money to achieve dominance that’s anything but guaranteed. Even SoftBank, which has relied heavily on the strategy, is putting pressure on its portfolio companies to show that they can be sustainable in the short term, rather than at an unspecified point in the future.
Covid-19 has also made investors more rational, the Gojek investor said. Ride-hailing businesses have slumped during citywide lockdowns. Even in countries where economic activity is bouncing back, office workers are often not traveling at peak hours, robbing companies of surge pricing schemes that boost revenue. Food delivery has outperformed during the pandemic, but intense competition has also meant that it’s yet to be profitable.
“The amount of money we were burning on the Gojek side, and the amount of money that Grab was burning on their side, was crazy,” the Gojek investor said. “We’re happy that no one’s got the financial means to continue this kind of behavior. We always knew there would come a time when it would have to stop.”

There are other threats looming. Grab and Gojek are often considered a duopoly, but over the past year, they have faced stiff competition from Sea Group, a deep-pocketed consumer internet conglomerate based in Singapore that has spent big on e-commerce, digital payments, and gaming across Southeast Asia. Chinese internet companies have also begun investing in the region, a trend that could accelerate as antitrust regulation in Beijing pushes them to expand abroad.
“We’ll see a bit more competition going into Southeast Asia, into the markets where Grab and Gojek are active, and I think they know that,” said Mark Greeven, a professor of innovation and strategy at the IMD Business School in Switzerland.
For the two companies, scale is now everything, and they need to consolidate before it’s too late. But a potential deal could be derailed by politics, if governments intervene to limit monopoly power. So far, that hasn’t happened. After Grab bought Uber’s business in Southeast Asia in 2018, Singapore’s antitrust watchdog slapped the companies with fines worth only around $9.5 million. Not long afterward, Grab raised around $2 billion from investors.
In December, Kodrat Wibowo, chairman of the Indonesia Competition Commission (KPPU), told Rest of World that his office had not yet been approached by Grab or Gojek to discuss a merger. “It will not be that easy for KPPU to judge that the merger of the two online giants could be a monopoly,” he said but added that a combined entity could be forced to divest some of its assets before a deal would be allowed to go through.
There are still reasons to think governments might intervene, especially in Indonesia, where Gojek is a symbol of national pride and one of only a handful of tech companies to be valued at over $1 billion. Gojek cultivated investors from within Indonesia’s influential business community early on, and one of its co-founders, Nadiem, left in 2019 to become a minister for education and culture. Two investors in Gojek expressed uncertainty about whether the Indonesian government would accept a deal that made it look like the company was being taken over by a foreign rival.
SoftBank still wants to make the deal happen, according to several people familiar with the discussions. Other investors on both sides were also on board, at least until late December, when talks broke down. Sources told Rest of World that the main sticking point appeared to be Grab’s co-founder and CEO, Tan. They confirmed previous reporting from Nikkei Asia that indicated Tan expected to be in charge of the combined entity.
Tan’s objections may have forced Gojek into the arms of a rival. Tokopedia is another Indonesian unicorn, an e-commerce platform similar to Amazon that’s used by more than 8 million third-party sellers. SoftBank is a major investor, as is Alibaba. Gojek investors who spoke to Rest of World said that, even though they were initially baffled by Tokopedia’s sudden appearance, they had since come around on the idea of consolidating. “It’s a very compelling merger synergistically,” one said, “and more compelling than Grab.”
Greeven, from IMD, agreed that the deal makes sense strategically and could turn Gojek and Tokopedia into an entity similar to Chinese tech giant Alibaba. The two companies would control businesses that cover a wide spectrum of their users’ activities, including e-commerce, transport, and payments. “Then I think maybe there is a road to profitability. Combined, they have more than enough users to start to monetize that,” Greeven said.
“Toko-Jek” or “Gopedia” — investors and analysts haven’t yet settled on a name — would leave Grab in a difficult position. The company would suddenly be facing a large, more diversified rival with an almost unassailable position in Indonesia. At that point, one early investor in Gojek told Rest of World, with no small amount of glee, Grab’s last option might be to get acquired by its new competitor.
While the idea of creating an enormous quasi-monopoly excites investors, the possibility has alarmed unions and labor organizations.
Thousands of ride-hailing workers in Indonesia have formed their own unions and independent mutual-aid groups to lobby the government and companies for stronger rights and better conditions. Around the same time that drivers demonstrated against Grab in Vietnam, a group of Indonesian unions issued their own warning to the company and to Gojek: If merger talks went ahead without their concerns being heard, they would organize nationwide protests.
Conditions for drivers had already been worsening in Indonesia, according to Ariel, from the Online Drivers’ Association. When competition between Gojek and Grab was at its height, both offered bonuses incentivizing drivers to work at peak times and maximize the number of trips they took. That practice has now been suspended, significantly reducing their overall income.
“[Drivers] were chasing bonuses for the whole day,” said Ariel. “The standard price is still very low.”
The same concerns were echoed by labor activists and driver groups around the region, who fear that a near-monopoly would have too much control over pay and conditions. When Grab absorbed Uber’s business in Southeast Asia, it became the largest player in Singapore and the Philippines, which resulted in diminished income for drivers.
Things marginally improved in Singapore when Gojek entered the country in 2019 and began offering incentives for drivers and customers to switch platforms. “What we’ve seen is that even a small level of competition is a salve for gig workers,” said Jai Vipra, a senior fellow at the Vidhi Centre for Legal Policy, a Delhi-based think tank where she studies labor and technology.
Even tiny drops in earnings can have a significant impact on the livelihoods of drivers. They often make the bulk of their money through apps and take out loans to buy or lease their vehicles. Platform companies often argue that their workers trade job security for increased flexibility, but most gig workers in Southeast Asia and other parts of the world have neither.
When ride-hailing companies first entered the region, they seemed to offer better pay and conditions than the often exploitative middlemen and transportation cartels that previously controlled the sector. Now, the more dominant tech companies become, the more they seem to be replicating the business models they replaced. “Eventually it tends toward the same kind of exploitation,” Vipra said.
People who work for ride-hailing companies are acutely aware that the only path to profit is through them and their passengers: in other words, raising prices and lowering compensation.
In Jakarta, Ariel called working for ever-shrinking margins “technological slavery.” In Ho Chi Minh City, a Grab motorbike driver named Trung said that, while the company calls its drivers “partners,” he mostly feels like an expendable commodity. “Grab doesn’t care about the drivers. It’s like throwing a lemon away after squeezing it,” he said.
Trung is looking forward to the upcoming Lunar New Year celebration, also known as Tet, which he said will be a fresh start. After the holiday, he plans to stop driving for Grab. The 29-year-old — who has a degree in automotive engineering — said he recently got his driving license and plans to borrow money to invest in a taxi. “If [Grab] treats me well, I will continue, and if they don’t, I will find another way,’’ he said.