Ankur Mehrotra, managing director and head of financial services for Grab, still gets emotional when talking about the drivers and their dreams of owning cars. Not exactly in a tearful way, but one can hear something in his voice — some heartfelt tone — that signals how important it is that rideshare drivers have opportunities to own vehicles.
Grab, as most know, is a financial services ecosystem that serves the 630 million citizens in Southeast Asia — and has expanded from ridesharing and food delivery to lending and insurance for these micropreneurs. As one can imagine, those small-scale businessmen and women are ridesharing drivers who often work long hours every day to earn income to support their families and businesses — and save up in hopes of taking total ownership of their operations.
Such dreams — dreams common to all of humanity — can fuel innovation.
In Grab’s case, the company started with the innovation of its digital wallet, now downloaded by 144 million of those 630 million citizens, which makes transacting only a mobile phone app away. Grab has since expanded to include relatively low-cost loans with more reasonable terms than from other lenders, Mehrotra told Webster. The data collected about those drivers during their working hours in their vehicles — Grab knows driver accident rates, for instance — helps the platform operator determine who might make a good credit risk, and how much working capital can be extended to them.
When such drivers came to sign loan papers and take possession of their vehicles, Mehrotra recalled how they were accompanied by “their wives, grandmothers and kids. It was a family affair. Many tears were shed. Drivers came and told me about their dreams of always owning their own cars. That was one of the touching moments for me.”
That story — used by Mehrotra to illustrate Grab’s ambitions to be a firm that is part of people’s lives — stood out not only as a feel-good tale, but as an example of what payments and commerce ecosystems are about. Technology is paramount, of course, but so are the right partnerships (Grab works with big firms such as Toyota, as well as small, hyperlocal merchants and service providers). However, the ongoing success of Grab, according to Mehrotra, revolves around this question: “How can we touch the lives” of the people who rely on the platform, both on the supply side (such as drivers) and the demand side (the consumers)?
“Ecosystem” is among the most popular buzzwords in digital payments and commerce these days, and one is forgiven if its regular use has led to numbness. Yet, as with Grab, it becomes clear that “ecosystem” is more than just the latest business buzzword. Not only that, but lessons about how and why to build one emerge from Grab’s experiences. Such examples include its striving to gain payments and commerce dominance in a part of the world that is home to 10 vastly different countries — a region that, by 2030, will have the world’s fourth-largest economy, but in which 70 percent of consumers remain under- or unbanked, lacking the access to credit that can improve their financial stability and prospects.
For Grab, this meant starting from a defined part of the region’s economy and labor force (drivers), and building from there. Think of the growing Grab ecosystem as a positive feedback loop, perhaps: Drivers attract more consumers to the Grab ecosystem, who can then use Grab services to pay for rides, and other products and services, such as food and grocery deliveries, the latter of which will “bring a lot of synergies to our business,” Mehrotra told Webster. Those drivers also get access to credit via the Grab platform, and Grab is working on more payment options for consumers so that they remain loyal (sticky) to the platform and ecosystem.
Along the way, as those services scale and expand, Grab keeps attracting new partners. Among them are merchants that do business in only one local market, but often have their own dreams of expansion. In those cases, Mehrotra said, Grab acts as the “bridge” that enables those operations to “go from hyperlocal to regional.” That’s not always easy in a region with vast cultural, economic differences — which are seen even in the ridesharing business. For instance, Vietnam is the land of two-wheeled transportation, while alternative modes are more popular in other countries.
A unifying force — well, besides the payments aspects of a digital platform — comes from mobile devices. Mehrotra said one in four smartphones in Southeast Asia have the mobile app, which Grab tends to call, in a utilitarian way, the “Super App” or “Everyday App.” (Webster, for her part, advised that maybe those rather plain terms don’t do justice to the operations and ambitions of Grab, but that’s an issue for another day.)
Grab may operate its own ecosystem, but that ecosystem is part of a larger ecosystem — that’s another lesson from the Grab story. “The only way Grab can grow is if the markets and countries we operate in grow,” he said. That growth, in turn, requires giving more people in the region — tens of millions of them, if not more — access to credit and financial services.
The work involved in doing that gives Grab ownership of massive amounts of financial and other data, from both the supply and demand sides. Webster wondered if that means Grab is, in essence, creating a credit-scoring system that, if licensed and used by others, could further spark growth in the markets served by the platform. Mehrotra didn’t rule that out, but he didn’t offer many specifics, either. However, he acknowledged that all that data gives Grab “an edge,” and could serve as leverage for future deals or business expansions.
He added “that we are looking into financing businesses — [micropreneurs] — [that] may not want to be, or be directly, in our ecosystem.”
Those are the goals — the vision. As Mehrotra explained, the Grab story is just beginning. There is always the chance of a new, fierce competitor taking on Grab, and of new technology providing an edge for another entrant. Yet, as powerful as technology is, and much as it serves to connect the supply and demand sides, it only takes one so far. An ecosystem requires more than just technology to keep growing and become a regular part of people’s lives.