Tokopedia Announces Investment from Google and Temasek

Through his social media account, Tokopedia Co-Founder & CEO William Tanuwijaya announced that Temasek and Google had now entered the company's shareholder ranks. The news has actually been circulating since last month, but at that time the company was still reluctant to comment.

Source Bloomberg said, this new investment is in the range $350 million or equivalent to 5 trillion Rupiah. This funding brings company valuation to $7,5 billion. The funds will be focused on launching the post-Covid-19 business expansion agenda. As stated by William, the company's mission is to accelerate digital transformation and promote economic equality through technology in Indonesia.

Previous Nikkei Asia Review said Tokopedia had submitted documents to the Ministry of Law and Human Rights, with Google holding 1,6% ownership, while Temasek through its affiliated company, Anderson Investments, holding 3,3% stake in the company. This figure is subject to change because it does not reflect the total investment in this funding round.

Before this round, Tokopedia lastly announced the acquisition of $1,1 billion funding in late 2018, led by SoftBank Vision Fund and Alibaba Group. Softbank through some of its funding is estimated, before the last funding round, owned 38,3% of the company's shares, while Alibaba about 25,19%.

Collaboration with Google

Information from trusted sources, to DailySocial said that after this funding, Tokopedia and Google agreed to establish a strategic partnership to strengthen the adoption of cloud computing services. Our sources say, they compiled a j to offer Google cloud computing products to merchant Tokopedia who wants to increase its business scale.

It has not been disclosed in detail what service it is, but if you look at the product lines that Google markets in Indonesia, these services could be Google Cloud for hosting solutions and data analysis, Google Workplace (formerly G Suites) for productivity, and Google Ads digital marketing or advertising technology. (formerly AdWords).

E-commerce landscape is getting more and more interesting

According to the latest e-Conomy SEA 2020 report, e-commerce business in Indonesia is predicted to reach GMV $32 billion this year. The compound annual growth rate (CAGR) reached 54% from 2019. This figure is predicted to reach $83 billion by 2025 as internet and infrastructure penetration increases.

Until Q3 2020, ranking top three Indonesian e-commerce services, based on the number of visits, are still occupied by Shopee, Tokopedia, and Bukalapak.

Previously Microsoft has announce investment in Bukalapak. Although no details were given regarding the amount and funding agreement, it is estimated that the value will reach $100 million or around 1,4 trillion Rupiah. In addition to applying Microsoft Azure cloud computing services internally to Bukalapak, the other agenda of the two companies will be to jointly improve the digital competence of SME partners who sell in Indonesia online marketplace The.

In the cloud computing product line, Google and Microsoft (and AWS) are indeed competing fiercely as global providers. The entry of US investors with large funding values ​​indicates that Indonesia's digital economy is increasingly attractive to work on through a "local approach", including collaborating with local startups.