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Jacob Carpenter

The IPO squeeze just keeps getting worse

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Meena Thiruvengadam

Where cash is still king, governments are partnering with superapp Grab to bring people into the formal economy

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Jixun Foo

The key to superapp success is a super wallet

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Gregor Stuart Hunter

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Grab helps people get deliveries, cars, bikes, financial services, and more from one app.

Ming Maa of Grab on the rise of super apps

 Stuart Isett for FORTUNE BRAINSTORM TECH

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Ming Maa of Grab on the rise of super apps


So let's talk about that super app strategy. I mean you are, you know, to, to think about it in our context, you're trying to be uber and doordash and Paypal all at the same time. Why does that make sense? Why is it important to bring financial services and and uh food delivery, e commerce delivery and ride hailing all into one place? Yeah. Well first of all those are great comes to be compared with them. So we're very comfortable I think super perhaps have their origin in china. The journey of super abs in southeast Asia has taken a very different path all by itself to reach out. As you know, started with messaging. Ali pay started payments. We really focus on solving everyday problems that were really endemic across traditions in our case that was about solving safety and transportation. That's what really helped us build the largest driver network in the region and it's this large on demand network is from korda how we've expanded our super app ecosystem because we're able to now leverage this network to move not just people but also food e commerce packages and now even push trees and all of these grew as natural adjacency to our start and along the way we we launched the region's largest digital payment's rails to enable transactions in the digital economy. And keep in mind we're operating in a region where cash is still king. Banking penetration is very low critic hard adoption is 10 and just like in financial in china we've identified opportunities to drive financial inclusion and make financial services much more affordable to the middle and the part of part of the pyramid. The analogy I like to use is it's like the small tubes of toothpaste, you know, toothpaste manufacturers started reducing the size of the two for about eight ounces in the U. S. To two bounces and developing markets to make it more affordable. Now we're doing the same thing in financial services by fractional izing products, micro insurance, micro saving, micro lending. But talk about that. Yeah, talk about that a little go go into that a little bit deeper because it's not clear, it's not clear to me that I would ever want to get financial services or insurance from my Uber driver or my door dash delivery person. So why explain why in the southeast asian context. That makes sense. Yeah, particularly made our countries when you're looking at banking penetration, that's less than 40%. So less than four in 10 to a bank account Where credit card penetration is one intent the opportunities to access the same products that you and I may be somewhere with in new york in Singapore just simply aren't available. And so when you come into the market and introduce a very affordable product that now everyone can access even if they jumped the bank account, that's how you unlock the water part of it puts a high premium on trust. I mean, yes, sure. I want to be in an Uber where I trust my driver and I want to my door dash delivery person to be someone I trust but the people who are doing my banking and selling me insurance that really requires trust. What do you do it grab to establish that level of trust? Well it's a great question. It all started with our D. N. A. Which is the first problem that we're solving was around safety and transportation. So we wanted to collect 10 years ago if you were taking a taxi in Poland poor you probably wouldn't have felt very safe or secure. And so solving that safety issue, if you trust grab, take you from a to B. Financial services is one next extension of that. Don't trust secure point in countries like Singapore, we have now received a digital bank license which provides regulatory book site over the visual thinking business that we're launching that again creates additional levels of trust in ourselves as a financial services operator. You're a company that takes your purpose very seriously. Can you talk about that? Why and what it is absolutely grab really was founded on the principle of creating a true double bottom line, both economic progress and social impact. And having looked at a lot of companies now there's no question in my mind that there is not a more mission driven company that grab, you know, for our for ourselves, our mission for all grabbers that drive economic empowerment and again particularly for the bottom half of the population pyramid. And it's not a CSR, it's not an E. S. G. Tagline drafted by someone illegal Pr this is court, it's it's much more than just how much do our drivers earn. It's about up skilling and training, because that's the key to being sustainable and a great story. You know, we offer certified courses and digital literacy in partnership with Microsoft. In fact, we've issued more than half a million certificates to our tribal partners who may have previously been in construction or the grain markets. And we ended up even hiring one of our drivers as a software engineer at grab after he completed training. So those are the real up skilling opportunities and our our mission does guys everything that

[MUSIC PLAYING] SPEAKER 1: Anthony Tan is the founder and CEO of Grab, the leading everyday super app in Southeast Asia. And we're delighted that he would take some time to speak with us. You're at home now, Anthony, is that right? Tell us a little bit about what your work situation is like at Grab. SPEAKER 2: This is my new normal. First of all, Clay, thank you to you, and thank you to Fortune for giving me this chance. I really appreciate it. And as you can tell, this is home. This is as home as it gets. That's literally the children's playroom where they spend most of their day. So all of us, even though we have the ability to go to the office because we're seen as an essential service, somewhat, we've taken the call to ensure that our guys, our fellow teammates are all as safe as possible. So we've implemented, right now in Singapore where I'm calling from is literally 100%, or close to maybe 99% work from home. SPEAKER 1: Grab is a remarkable company in that it has so many different business units, and it's engaged at so many different points in ordinary people's lives. What sort of measures have you taken to promote hygiene and assure the health and safety of those team members? SPEAKER 2: Well, as you correctly said, hygiene is tremendously important right now. Straight off the top of my mind, number one, we would have first introduced Grab Protect. So imagine you jump in a car. There is hands sanitizers, there's the plastic shield, there's the-- every time you jump on the app, you can verify that I agree to all these terms. And a driver can even choose to-- when he comes in and he sees that you're not wearing a mask, he can choose to reject you as a customer, even you, Clay. So that would be something that we would never have accepted before. But today, we will prioritize safety and hygiene even above customers. And customers actually appreciate that. We've seen how that's really helped the business, not just in rides, but also in food delivery. So for example, we have all the contactless. We make sure we do temperature checks for our merchants, our drivers. We have to submit temperature checks in the app constantly throughout the day before they can take certain parts of the day to retrigger their work activity. So we've done really-- and the good news, if I may share, is that when they did a survey, Grab is seen across the industry as the safest and most hygienic platformer. SPEAKER 1: In the United States, Uber and Lyft have faced some real difficulties in having customers have enough confidence to come back and actually ride in their services. Whereas in China, for the most part, DiDi seems to have been a little bit more successful in persuading people that it was safe and they could get back in the car. What's been the response of Grab customers? SPEAKER 2: The difference you mentioned about Uber and Lyft, and those are great peer groups. For us, we have a diversified business from rides, transport, mobility, all the way to food delivery, mart delivery, so groceries, things like that, all the way to social, e-commerce. So we facilitate, we're one of the largest, if not the largest in same day and instant deliveries that supports the e-commerce-- the bustling activity of e-commerce right now taking place in the region. So what we see is one, diversity is playing out. Because as the pandemic hit, our rides of course, came down, naturally, as cities went into lockdown. But our deliveries business shot up really, really fast. We were-- I mean, on some weeks, we were registering 20%, 30% growth. That's one. I think two is, what we're also seeing, the difference-- and you talked about this in the states and Southeast Asia-- is that, because car ownership is also much lower in this part of the world than in the US, we see that people tend to be more willing. As long as you can give them that assurance of safety and hygiene. SPEAKER 1: That's really interesting. Does it suggest to you that one legacy-- sort of long-term legacy of the pandemic is that people are much more habituated to the idea of shopping online and e-commerce, and that that's a permanent shift? SPEAKER 2: That's exactly right. There has been a permanent shift. What we see is customers including-- I would say we probably have a-- the core segment would be, for example, on food delivery, a lot of our customers are female between the ages from say, 20 to say, 18, 20, all the way to say, 35, 40 years old. And this idea of complete cashless, food arrives, my e-commerce arrives, my groceries arrive was a novelty. But now it's become a real deal. SPEAKER 1: Really interesting. I wonder if we could talk a little bit about how this feels from the vantage point of many of the vendors. I mean, you work a lot with small businesses, whether it's people that are supplying food, or groceries, or really any kinds of different products and services. This is a very difficult time for people that are in the small business space, is it not? SPEAKER 2: That's exactly right. It's tremendously difficult for some of them. Some of them have-- many of them who weren't on Grab had to close. So this is where, I believe, that Grab food, the likes of Grab Pay, a lot of these services that were seen as maybe at one point in the early days, nice to have. Today, they were the primary source of business for many of these guys. So in many of the governments around the region, they classified us as essential service. So even more important than a straight out public transport, because people weren't going to work, it was a must have to get food into homes during lockdown. SPEAKER 1: Fascinating. Have you been surprised by how successful most of the Southeast Asian economies have been in coping with the pandemic? I think initially, there was a fear that this was something that, once it really got started in Southeast Asia, was going to rage through the entire region very quickly. SPEAKER 2: I would say, I can't speak for all. I think I wouldn't make generalized comments. But you're right to say that most of Southeast Asians' businesses right now, something like 90%, are small medium enterprises, SMEs, that really are a major part of the region's business. Now, a lot of it was also, I would say, traditional. Meaning in the sense that they were mostly offline. So the penetration of the food e-commerce, or grocery e-commerce, or mobile payments, were still very low-- or cashless-- are very low compared to, say, the US or China. So I think that COVID obviously took what was clear, that is from the future and just brought it forward by years. Second, I would say, it's safer in Singapore. I think in Singapore, they executed this, if you don't wear a mask, there's this ability to self police. If I walk out my apartment and I don't wear a mask, you don't need a police man to find you. I know people, your neighbour will just stare you down until you-- and even if the mask was below your nose, they will make sure that it has to go above your nose. People stare you down. So I think that ability to-- this region or at least Singapore and many of the other countries can be quite disciplined when it came to wearing masks, for example. They were quite disciplined to make sure, hey, I'm an emerging market. I need this, and I need to embrace whatever it takes to survive. And that hunger was there. So they just quickly pivoted to online very quickly. SPEAKER 1: What's the kind of baselines that you're using for business planning and sort of mapping out where all these economies are-- how did I know-- in the US, a lot of people are hanging on, waiting for the vaccine. Because they kind of figure that things will not really be back to normal until a significant number of the population has been vaccinated. Do you see approaching a kind of more of a normal economic outlook even before there is a vaccine? And what's your expectation for having a vaccine? SPEAKER 2: The reality is, every city in the region is going to have a day that they will feel like it's nearly solved. And then, there's going to be another day that they will feel like doom and gloom. So what we are seeing is these waves. It's not going to be this permanent sense that, oh, we're out of the danger zone and that's it. And I think it's good. None of us should, in fact, we should be on our toes to ensure that we prevent the next wave from happening or delay it as long as possible. So when we plan our business as we said, for example, one advantage we had was because we had a lot of say Grab car, Grab bike drivers. And the minute that transport came down, they were available. Grab food came and saw a massive spike in volume. We could move these drivers. So we moved something like 149,000 drivers in a period of two months-- 149,000 drivers in two months. Can you imagine? That's like an army. And we're talking about like moving them from what they were used to every day to bringing people to work now, going upstairs, picking up the food from the restaurant, or shopping from a grocery store, and then delivering that. We also saw how our GrabMart scaled to about 50 different cities in a period of 2 and 1/2 months and fewer cities in eight countries. So now we have partners with 3,000 or more stores in this short period. Again, all this literally came up during COVID. We've also seen how Grab Pay-- and again, people-- so imagine this, we thought that people would be-- you know, if it's a card, but people don't even want to have somebody else touch their card. This idea of touching my card is now seen as non-kosher. So the idea that I can just QR code pay, the idea that I can just tap this idea. So for example, if you have a Grab Pay card put in your phone, you can tap it for MRT, for mass rapid train. You can QR code to many thousands of our stores across the region. And because most of the people in this region, say 70%, are underbanked in some shape or form. So that, to us, was a great boost. SPEAKER 1: That's really quite a thing. Because we're talking about a group of economies where-- there is some variation, obviously. But where you've got many people, who as you say, are underbanked. That they're used to just using cash all the time. Cash that gets passed from one hand to another, to another, to another-- that's a very fundamental transformation on consumer psychology. SPEAKER 2: Fundamental, right? I mean, cash was one. But imagine, I thought cards-- like you wouldn't have thought a cards economy that bad. People don't even want to pass a card on. So it's so pervasive from a customer behavior change. And merchants don't even want to-- they actually encourage their cash bearer not to take it. Because they don't want a sick staff and then passing it on. So they say, please, I encourage you, use your phone-- QR code pay, please. SPEAKER 1: And you think that's going to be a lasting shift? SPEAKER 2: Oh, yeah. There are stores that I see today don't even accept cash anymore. They say no cash accepted here. That's a new reality. SPEAKER 1: Fascinating. You've been very generous with your time. These are wonderful insights in a very fascinating and diverse market. Thank you for sharing them with us. And we hope that you'll come back and fill us in again later on your progress. And in the meantime, stay safe. SPEAKER 2: Thanks so much, Clay. Please stay safe in Hong Kong. And my best regards to your family as well. 

Eastworld Spotlight: Grab CEO talks digitization and diversification

Tech

Anthony Tan on how Grab is adapting under COVID-19.

Watch: Grab CEO talks digitization and diversification

Anthony Tan shares how Grab and other businesses are adapting during the COVID-19 pandemic.

Brainstorm Finance 2019: When Will Emerging Markets Finally Emerge?

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Hear from the financiers and businesspeople greasing the gears of social mobility from Latin America to Southeast Asia.


[ MUSIC ] Welcome to Broad Strokes Fortune's week show were we talk about the news that matters to women. And on this week's show I'm happy to say our weekly Trump segment is about Ivanka Trump instead of Donald. It's kinda refreshing right? [ MUSIC ] Ivanka Trump was in the news this week because her brand, the Ivanka Trump Collection, is being boycotted as well as the stores that sell it. This boycott is mostly about her father and the allegations around him with sexual harassment sexual assault and the fact that Ivanka has [ UNKNOWN ] stood by him. There's no hard evidence saying that [ UNKNOWN ] or everything is going on [ UNKNOWN ] is usually affecting her at all. You had two [ UNKNOWN ] competing poles this week. One for morning [ UNKNOWN ] said that most women wouldn't buy her clothes, that democratic you know three out of four women kind of would never consider wearing her clothes Then on the other hand, you had [ UNKNOWN ] which is another agency basically saying [ UNKNOWN ] women don't actually care about all these things. It's clear that she's concerned about it. You know, she spoke at a M P W summit last week. She wants to be out there sort of fighting for it and protecting her brand. Seeing her at the summit, I actually had a lot of respect for her. I thought she did a really great job kind of keeping a safe distance from her father by kind of playing the good daughter card. She doesn't choose her family. It's not her fault that Donald's her dad. Like, she can still be a strong woman and a feminist while still being Donald's daughter. I mean, I have to say I disagree with you on that point, I feel like Ivanka Trump is a strong woman, and she's her own woman. And if she wanted to, she could come out and take a really aggressive stance against her dad's actions and the things that he stands for. [ MUSIC ] This week in our office, we were talking a lot about this new study that came out that basically said that When a female CEO's company is in trouble, she gets blamed 80 % of the time. But then on the other hand if it's a male CEO at the helm, he only gets blamed for a crisis 30 % at a time. Yeah. This really made me think about this story that our colleague Jen Rangle did. She was looking at the fact. That women who rise to top of corporate America often disappear pretty early in their careers whereas you see men in job after job and she went back and looked at Fortune 500 CEOs starting in 2004 and and found that no female CEO who has been pushed out of her company ever another CEO job. Meanwhile five male CEOs Basically failed upwards. They got fired and then landed another top job. Female CEO's in general have only repeated as CEO's twice, right. We had Meg Whitman from eBay to HP. And then you had Susan Cameron who was the chief of Reynolds American twice and she actually just retired last week. [ MUSIC ] So Gretchen Carlson was back in the news this week. She's on the cover of Time, and this is her first big interview since she settled with Roger Ailes and with Fox News. So the story looked at what she's gonna be doing next, and one thing that they talked a lot about is the fact that she will be testifying before Congress about forced arbitration. Which is essentially when you take a job with a company and you are required to sign a document that says Look if we have a dispute, I will not take you to court, we will go into arbitration and deal with it privately. Yeah I mean one of the really kind of interesting things from the story is the fact that a better quarter of working Americans who are in union to have arbitration causes in their contracts. That is a lot. Which is si many kind of goes the show That only somebody like Gretchen Carlson, somebody high profile with a lot of cloud in the media, with a lot of capital resources, can do something like this. Because for the regular person, knowing to sue Roger Ailes versus Fox News would've escaped us. As we probably would have been bullied into arbitration room. I was interested to read this piece in the New York Times a few months back by Maureen Sherry. She was a banker at Bear Stearns before the financial crash and she made a couple of interesting points. So, one is the fact that half of the Cost of arbitration is borne by the employee, and that can be a lot, especially when you're up against the resources of a massive bank. And second of all, the arbitrators, from what she discovered, are generally pretty favorable towards the companies. So in two- thirds of the cases that she looked at, the suits were settled in favor of the bank. Unfortunately, that's all the time we have this week on Broad Stokes. Come back next Friday for another episode on Fortune. com. [ MUSIC ] [ BLANK_AUDIO ]

We dive into the latest news from Gretchen Carlson and take a look at the boycott of Ivanka Trump's brand. Tune in!

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