SINGAPORE: Anthony Tan knew it was not going to be your usual business meeting when the taxi fleet boss he had arranged to meet in the Philippines entered the restaurant surrounded by burly bodyguards.
“I remember thinking, Manila is hot, why is everyone wearing a jacket and sunglasses at night? What is going on?” said Tan, co-founder and chief executive officer of Singapore-based Grab, Southeast Asia’s most valuable tech start-up.
Tan was there to sign up the taxi-fleet owner to his ride-booking app. Midway through the negotiations, there was a loud thud. He peered under their table and saw what looked like a machine gun on the floor.
“I was like, holy cow, I guess this negotiation is going in your favour!” It was only later that Tan realised he had just sat across the table from one of the area’s biggest arms dealers.
Tan laughed as he recounted the early days of Grab to the South China Morning Post at its swanky new headquarters at Marina One West in Singapore’s downtown business district. Occupying two floors with expansive views of the busy Tanjong Pagar port, both Grab’s new digs and Tan’s anecdote underscore how far the start-up he founded with fellow Harvard MBA classmate Tan Hooi Ling (no relation) has come from its beginnings in a cramped garage in Kuala Lumpur, Malaysia.
Since its inception almost six years ago, Grab has fought off no-holds barred competitors such as US-based Uber to lead the region’s ride-hailing market. Grab has morphed into Southeast Asia’s most valuable tech start-up with a valuation of over US$10 billion, giving Tan a personal fortune of around US$300 million, according to a Forbes estimate made before the latest fundraising round.
Southeast Asia, with its population of about 660 million, has long been seen as the next big market for tech companies – the ride-hailing business alone is forecast to be worth more than US$20 billion by 2025, according to a report on Southeast Asia’s internet economy released by Google and Temasek Holdings in December.
Today, Grab operates in 225 cities across eight countries and boasts over 100 million app downloads. What started out as a taxi-booking app to help keep both drivers and riders safe has evolved to include bookings for private cars, bicycles, shuttle buses and now delivery services for food, parcels and groceries. To tie all of its services together, it also launched mobile payments service GrabPay in 2016, making payments for services more convenient and incentivising users to make in-store purchases in exchange for reward points. The company is expected to generate US$1 billion in revenue for 2018.
Dressed in a black polo T-shirt and charcoal slacks, Tan has a warm, approachable manner and his speech is peppered with colloquialisms common to Singapore and Malaysia. But Tan’s down-to-earth manner belies his well-heeled background – before founding Grab, the 36-year-old was better known as a scion of a prominent Malaysian family.
“I first met Anthony at a (Harvard) business school event. He was super well-dressed, very extroverted and knew all the right people in the room,” said Grab co-founder Tan Hooi Ling.
Anthony Tan is the youngest of three brothers born to Tan Heng Chew, president of Tan Chong Motor, which assembles and distributes Nissan cars across Southeast Asia. His father believed in the school of “tough love” though and so the younger Tan was put to work on an assembly line and accompanied his father to meetings with tough union bosses, which opened his eyes to a different world.
“At first I had the typical preconception (of him as a rich man’s son),” said Hooi Ling. “But when I got to know him, I was super impressed with Anthony’s work ethic. He is one of the most hardworking individuals I have ever met … despite the natural advantages he has from his family.”
Foo Jixun, a managing partner at venture capital firm GGV, which led Grab’s US$15 million Series B round of financing, said he found Tan’s passion interesting, especi
ally since he was born with the proverbial “silver spoon in his mouth” and did not necessarily have to prove anything.
The idea for Grab (originally known as MyTeksi) was conceived when the two Tans happened to sit next to each other during an MBA class. While ride-hailing companies at the time, such as Uber and Didi Chuxing, focused on providing better matching of supply and demand for rides, Anthony and Hooi Ling had a different starting point – improving safety.
The safety of Malaysia’s taxi industry at the time left much to be desired. There were some bad eggs among the taxi drivers, and it was giving the entire industry a bad reputation. “Hooi Ling experienced the pain for herself. When she was a consultant at McKinsey she’d finish work late at night and would have to pretend to be on the phone with her mother (while in the taxi as a safety precaution),” said Tan.
Armed with an innate understanding of some of the dangers of single travel in the region, Grab allowed passengers to share the progress of their rides, in real-time, with someone else as a safety precaution. Soon after, it followed in Uber’s footsteps by including number masking between drivers and passengers to protect user privacy.
Earlier this month, in a major broadening of its business, Grab announced that it would be opening its platform to third-party service providers as part of a push to build an everyday app that can provide a wide array of services.
To find partners for its open platform, Grab has started a venture capital arm, and intends to beef up its financial services offerings to serve the underbanked in Southeast Asia. It has even moved into artificial intelligence, partnering with the National University of Singapore to analyse user data and explore ways of improving mobility across the region.
Today, Grab has a list of shareholders that reads like a 'who's who' in the on-demand services industry and Tan can tap business leaders including SoftBank Corp.’s Masayoshi Son, Cheng Wei of China ride-hailing giant Didi Chuxing and Uber’s Dara Khosrowshahi for advice… CONTINUED…
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