Grab, Southeast Asia’s leading ride-hailing app, has committed to invest US$100 million over the next three years in Myanmar, where Uber also debuted earlier this year.
The company will use the money to extend its services to more cities in the country, which has seen exploding mobile phone adoption. It will also roll out other products such as its digital payment feature GrabPay, and increase its local headcount to 200, it said in a statement. The company is exploring offering its corporate ‘Grab for Work’ solution after seeing healthy demand.
“Grab in Yangon has taken off at an incredible pace,” said co-founder and CEO Anthony Tan. “This is already one of our fastest-growing markets.”
Grab launched in Yangon, Myanmar’s largest city, with its GrabTaxi component in March. Since then, Grab has grown to reach 25,000 unique bookings per day, with more than 6,000 screened and licensed drivers.
Myanmar’s economy opened up only a few years ago after one of the most brutal dictatorships in Asia. The country’s abundant natural resources, strategic location between Asian powers India and China, and its largely untapped market of 60 million people have caught the interest of both investors and entrepreneurs. Myanmar’s potential is boosted by a surge in mobile phone adoption to 80 percent in the past two years after foreign telcos like Qatar’s Ooredoo and Norway’s Telenor kickstarted competition and brought down prices.
Grab arch-rival Uber also entered Myanmar in May, launching a feature to book accredited taxis instead of private cars to get in regulators’ good graces. It’s a different approach for the US giant, which has traditionally clashed with authorities.
But the move makes sense in once-isolated Myanmar, where the landscape is a lot different than the rest of the region. Private car ownership is still in its infancy, with most people choosing second-hand cars for their personal needs, while taxis didn’t even have meters until recently.
Myanmar is the newest battlefield for heavily-funded Grab and Uber, which will also be competing with local taxi-hailing services such as Hello Cabs and Oway Ride.
Grab is available across seven countries in Southeast Asia, with more than 55 million app downloads and 1.2 million drivers.