S2 Episode 5: Ming Maa of Grab: How We Grow a Super App in a Highly Diverse and Competitive Region

On this episode, we have Ming Maa, President of Grab, Southeast Asia’s leading super app, providing the everyday services that matter most to consumers. The conversation covered a wide range of topics; how Grab thinks about expansion (markets vs verticals), the tension between product development and scaling, what are the right kinds of high frequency use cases for a Super App, the Uber deal, best piece of advice he’s ever been given and what it is like to work with Masayoshi Son from Softbank. 

This episode also features a bonus interview with GGV Managing Partner, Jixun Foo, who led GGV’s investment into Grab in 2014. Jixun shared how he met Grab’s founder Anthony, the reason behind the different growing paths of Didi and Grab, and what he looks for in mobility startups. 

Grab offers transport, food and package delivery, mobile payments and financial services to over 36 million users across eight countries in the region. Launched in 2011, it is now reportedly valued at $14 billion, making it Singapore’s first “decacorn”, and a GGV portfolio company.

Ming has over 12 years of finance and investment experience across the U.S. and Asia.  He joins Grab from SoftBank, one of Grab’s key strategic investors, where he played a key role in overseeing SoftBank’s investments in SoftBank’s Series D and F investment in Grab. Ming received his Bachelor of Science and Master of Science degrees from the Massachusetts Institute of Technology.


Hans Tung : Today on the show, we have Ming Maa, president of Grab. Grab is Southeast Asia‘s leading super app, providing the everyday services that matter most to mass market consumers.

Grab offers, transport, food, package delivery, mobile payment, and financial services to over 36 million users across eight countries in the region. Launching in 2011, it is now reportedly batting at over $14 billion, making it Singapore’s first Decacorn. And it is also a GGV portfolio company.

Rita Yang : Ming has over 12 years of finance and investment experience across the US and Asia. He joins Grab from the SoftBank Group, one of Grab’s strategic investors, where he was based in Tokyo and played a key role in overseeing SoftBank’s series D and F investments in Grab. Ming received his Bachelor of Science and Master of Science degree from the Massachusetts Institute of Technology. Welcome to the show, Ming.

Ming Maa: Hey, guys, thanks for having me.

Hans Tung : We’re very fortunate to have you on the show. We know you’re super busy, always flying and doing a great job of managing Grab. You joined Grab in 2016 from the buy side with over 12 years of experience on the financial side of the equation. What attracted you about Grab to leave that to work for a startup?

Yeah, I mean, for me it was a no-brainer. I think being on the investment side, you get to see a lot of different companies and different business models and you see a lot of muscle memory about what works and what doesn’t work. But at Softbank, I was really in charge of all of the investments in ridesharing companies, whether it was Kuaidi, which ultimately became Didi, Grab. And then looking at other countries and territories across the world. One of the things that just really struck me was, when you really think about the opportunity in Southeast Asia, there’s just a lot of elbow space. When you’re in China Didi comes up against Meituan, against a number of different companies and payments. There’s a handful of companies. There’s just great competitors, great companies in each and every segment in Internet technology within China, the US, India. And when you look at Southeast Asia, on the other hand, and you look around at what’s available at the time that I joined, what you really notice was there was very little companies at scale operating in the region. And so, I looked at the opportunity. I thought, wow, this creates a whole bunch of white space, which maybe something interesting can come out of it.

Hans Tung : You’re very modest, because back in 2016, it was not an easy year for Grab. There was a huge battle going against Go-Jek. And then Uber struck a deal with Didi in China, thus freeing up a lot of resources, both in terms of people and money to go after Southeast Asia to wipe out the two local competitors. How did you navigate during that year to make both your personal transition as well as operations work to now, you guys are number one in the region.

Ming Maa: Well, I have to tell you, the first six years of the company was really, really hard. And you’re right, I think there was nothing more privileged than having an opportunity to compete with some of the world’s best companies from Silicon Valley. It was always a very daunting task that we had at hand. And when you think about what we had to overcome, it was competing against a company with much better technology experience, working at scale. I think many people would have put the cards against us when you thought about the opportunities in Southeast Asia. But when you step back, the core theme that we always had in Grab was to be hyper-local in every single thing that we do, and I think understanding the customers better than your next competitor is always the key to winning customers’ heart and mindshare. I can think of many different examples that came up over the last six or seven years.

One of the things that struck me the most was, Uber during the hot summer months had a program to deliver ice cream to a lot of the passengers in their cars. We were thinking about that and thinking, well, Singapore is a very hot place, obviously. But the problem is ice cream melts, and so that just creates a big, big headache for everyone. So we thought, well, what can we do that was different? And the thing that we came upon was durian. Durian is the king of fruits in Southeast Asia. It’s that fruit that everybody loves, loves eating. And so we decided rather than doing ice cream, why don’t we deliver durian to our customers, to our passengers across the region? And that mindset, understanding the local flavor, the local preferences, and really understanding at a hyper-local scale, I think ultimately that’s the key to helping us win customer mindshare, customer love, and really out serving our customers compared to international companies.

Rita Yang : So let’s talk about expansion for a little bit. Because as a startup, there’s two ways you can expand. One is to go into other markets, in this case, other countries in Southeast Asia. Another is to provide more services in one market. Can you tell us how Grab thinks about expansion? I know you guys ventured into many different places and services almost at the same time.

Ming Maa: Yes, and it’s very challenging, particularly in a region as diverse and heterogeneous as Southeast Asia, where everything is different not just from country to country, but even within certain countries. I think in that context, one of the core things that we had when we started was to be a regional company from day one. What I meant was, our first city of operations was in Kuala Lumpur, Malaysia. And typically speaking, the second city that a company would open would be another city within Malaysia. We took a very different tactic. Our second city was in Manila, in the Philippines. And then our third city, fourth city was then back in Malaysia, and then we’ve slowly expanded across the region.

But I think having that mindset of being regional from day one creates a lot of different behaviors and different ways of thinking about how to scale a business, how to have a core common technology platform that can scale while allowing each country to be very differentiated in their products and their services. And I think that mindset, we don’t see quite often in Southeast Asia. What you do see is, you see tons of companies who start in a single country, scale to a certain size, and then start expanding beyond their borders. But I think part of the challenge with Southeast Asia is just given the fragmented nature of each market, every individual market by itself is relatively small. And so to really grow to scale, you really need to have a regional first mindset from day one.

Rita Yang : Hans, I would ask your opinion as well on the same question, because we’re seeing a lot of companies trying to become the super app, particularly in Southeast Asia. What do you have to say about companies who are thinking about scaling?

Hans Tung : I think, as Ming said, it’s super difficult to try to do both at the same time, to go to different markets and expand different businesses. I think that the Grab team has done a remarkable job being able to do both and to fight against competitors. And it’s not easy, obviously not perfect. There’s always room for improvement, but it seems like, based on our experience, in order to win and to do well in a super competitive market, unfortunately, only the stronger survive. And this is all about how fast you learn. Nobody comes into the situation having all the answers. How you can make mistakes quickly and not have any mistakes hurt you fundamentally and grow from that, and be able to learn to fly and execute, it’s not an easy task. That’s why there are not many super apps that are successful and can get to the Decacorn kind of stage. The ones that can do it obviously will benefit a lot from just be able having to the upside potential of the market.

Rita Yang : Ming, you actually joined Grab the same year it launched the mobile payment GrabPay. Is that a coincidence, or actually it had been planned in parallel?

Ming Maa: No, that was a pure coincidence.

Rita Yang : Can you tell us about the role that GrabPay plays in the Grab ecosystem?

Ming Maa: It certainly wasn’t an obvious decision at the time. I think at the time we were so laser-focused around how do we better serve our customers in ridesharing, to divert engineering resources from, let’s say, launching another feature for ridesharing, versus diverting engineering resources for payments or financial services was not, I think, a simple decision that was easy to make. And it’s really quite interesting because I still remember at the time our board director, Jixun, would come to our board meetings every quarter. And every quarter he would remind us that payments creates a real competitive advantage in terms of customer loyalty, in terms of improved customer spend. And so really the right way to think about payments wasn’t as a separate independent business line, but really as something that makes the core business stronger and better.

And so I think after about four or five board meetings where Jixun kept on repeating the same thing, I think we finally figured out he was absolutely dead on, and we launched in 2016.

Hans Tung : GGV has the fortune of going through the Alibaba journey, and seeing Alibaba do financial. So, yes, Jixun was spot-on for recommending that. But again, it’s always easier to have the idea but much harder to have execution. So Jixun would be the first to say that you guys have done an incredible job. Again, not easy to get to where you are right now. Truthfully, in 2016, most people around the world thought, oh, my God. Grab and Go-Jek are in trouble. Uber’s coming in with all the ammunition, and they don’t have chance to win anymore. So I think for you to have to go through that, it’s a huge boost for a lot of local champions in differing emerging markets that if you can localize and learn quickly, stay humble and focus on execution, good things could happen.

Ming Maa: Yes, absolutely. The irony behind this is in some ways, Grab was really founded as partially solving a payment problem for ridesharing. If you remember back five, six years ago, ridesharing companies, the real value proposition was you can get into a car and get out without having to pull out your wallet. The payment process was integrated throughout the entire booking flow. And one of the very interesting things that we saw was when Uber expanded into Southeast Asia, they of course replicated that seamless payment journey within Southeast Asia. Now, the challenge that we saw was, part of the biggest problem in the region is very, very few people have credit cards. Frankly, very few people have bank accounts.

So the approach that Uber took, while it made sense for Uber as a global company, didn’t quite make sense in the context of Southeast Asia because you immediately alienate or take away a very large population set that could not otherwise use your services without credit cards or banking. So when we launched, we actually launched a cash prepaid card system that allowed drivers to purchase prepaid cards that then automatically drew down whenever a ride happened. That was the key innovation that allowed us to solve the working capital issue that was associated with cash payments for ridesharing. So in many ways, the first hook that we had was around, how do we sole cash payments in ridesharing? Then fast forward six years later, once we had built enough scale, built enough customer base, then we realized, well, why don’t we solve the cash and the cashless problem directly by launching payments as an alternative to credit cards? And that’s how we ultimately came up with GrabPay.

Hans Tung : It is not easy to design a super app. When we look at the Grab app now, you have five buttons down below a home activity payment inbox of account. And each one of them is pretty self-explanatory for what it does. Of course, there’s always room for improvement, but when we have friends coming from overseas, they can quickly figure out what they’re supposed to do. And this app is a lot more “complicated” by Western standards compared to Uber app, because at home you can transport the foods, delivery, subscription, e-scooter, trip planner, hotels, and a lot more. Based on the user surveys you get, do consumers in Southeast Asia get it as quickly as the Chinese consumers have, regarding super apps in China? Or is that an education process that you have to really spend time and effort to get the consumers in various Southeast Asian countries of different economic development stages to understand this?

Ming Maa: I think that’s a great question. Perhaps the right way to think about it first is, really what is the notion behind a super app, and why are there super apps in places like China and Southeast Asia, but not in mature markets like the US? The way that we thought about the super app is really as a platform that really enables an entire ecosystem or economy of digital services. And why it really works very well in Southeast Asia is because Southeast Asia as a region has always lacked a lot of the digital infrastructure that’s required for great vertical-focus companies to succeed.

So whether it’s payments, whether it’s last mile, whether it’s anti-fraud technologies, many of these basic things that we all take for granted as entrepreneurs in the US are missing in Southeast Asia. And so for companies and startups to scale from 0 to 100, what they end up having to do is either focus on a very narrow set of customers who have access to those services, or they have to recreate all of the services from the ground up. That creates tremendous burden and overhead for a company who’s scaling from zero. So we realized was, well, hey, we’ve actually built all these services for our own business. So why don’t we provide all of these services as EPIs to other startups and other technology companies, and enable them to thrive on top of the infrastructure rails that we’ve built? That was really the genesis for thinking about the super app.

One of the things that we always believe in is, it’s always better to partner with great companies. In fact, we always believe that it’s better to stand on the shoulders of giants than having to create things ourselves. And that has led us down the path of partnering with world-class companies like Bookings with Microsoft, with many others to provide specific services for our super app, whether it’s travel, whether it’s hotel bookings, and many, many more that will come.

But I think to your direct question around, does the consumer get it? Or is education required? I think there’s always an inherent amount of education that is required to drive new services. But one of the great things about Southeast Asia is it is predominantly a very young, affluent/middle-class population. You have a lot of folks in their 20s, in their 30s, who are mobile-first, mobile-native. And once they open an app, they start playing around and then they very quickly learn and get up the learning curve. So it’s a combination of both. But the key is provide the services and then let the market decide what makes sense.

Hans Tung : I’m just casually playing with the app and looking under home and under tripliner. You have buses, you have MRT lines, and which ones in Singapore are being affected by the F1 racing. It’s just very difficult for a foreign company coming into the region to know this much about what’s going on day-to-day and come in with those kinds of adjustments.

Ming Maa: Exactly. It really is all-around being as local as possible, and deeply understanding what really matters in every city, in every neighborhood.

Rita Yang : So Grab launched its food delivery services back in 2016, and also acquired UberEats from the Uber acquisition. Is food delivery the first non-transportation Grab ventured into, and why is food delivery the first one?

Ming Maa: Yeah, I think looking back, food delivery was the first non-transport business that we launched almost immediately after our merger with Uber. If you really think about the dynamics of that marketplace, it’s a natural adjacency to go into. Why? Because we have a massive transportation fleet of, whether it’s four wheels, it’s two wheels, we have three-wheel tuk tuks in certain markets. I always joke if there’s a five-wheel vehicle out there, it’ll be on our platform. What we realized is, the more opportunities that you provide drivers with ways to earn income, the more efficient the overall network becomes, and then the lower the cost of deliveries for our consumers.

So having a driver be able to deliver people during rush hour periods, deliver food during lunch times and meal times, and then delivering e-commerce packages in between, really provides the highest efficiency use of a supply network of transport drivers anywhere in the world. And I do think one of the unique aspects of Southeast Asia is a very open regulatory framework that allows our drivers to do all three services in one, unencumbered by restrictions that you see in China, where motorcycles cannot legally transport people, and other markets like the US, where perhaps motorcycles may be a little bit too short distance to cover suburban areas. So it’s a very good, sweet spot, where you can really take your transportation network, leverage it across a variety of different services, and then increase the efficiency across the entire network.

Hans Tung : Speaking of UberEats, let’s chat about the Uber deal, which happened only two years after the Didi deal between Didi and Uber in China. You guys had a tough 2016, Anthony wrote a letter to everyone and had a town hall meeting to rally the troops to fight back. Walk us through how you get from that point to getting actually the deal done in 2018.

Ming Maa: I think first of all, when I first joined, that was probably one of my first OKRs to finish. If you really thought about the market environment at the time, we had a company that was really firing on all cylinders in Uber. They were aggressively expanding into multiple geographies, multiple cities. They had launched a great product. And so in the face of that, there was a question around how do we sustainably compete and how do we sustainably provide services to our customers? Now, I think fast forward one or two years, I think we shouldn’t overemphasize — or underemphasize, rather — a lot of the events that have happened around Travis. I think Travis leaving the company was really one of the first trigger points that enabled a thoughtful conversation between the two companies around coming together and working together.

I think the second real trigger was having the great support of Chung Wei at Didi. And I think when Chung Wei invested into Grab, that was really the final nail in the coffin in the sense that we now had not only SoftBank, a great partner in its own right from Japan, but also the leading ridesharing company in China supporting us with technology, knowhow, and support. I think at that point, then there was a realization that, let’s find a better way to service our customers rather than beating each other up in the market.

Hans Tung : Ever since 2015, I’ve gotten to know the chairman and the founder of Uber Garrett Camp a bit. I’ve encouraged him on a couple occasions that Didi and Grab are not your enemies. It’s potentially down the road Amazon. So I think expanding into UberEats and taking resources out of Asia. Or does India, China, or Southeast Asia have to focus on UberEats at home and in Europe and other places are a much more productive use of capital [?] But like you said, when Travis was the CEO, that’s not how he rolls. I get that; he got the company to where it was and he’s going to run it his way. Who am I to make a suggestion? But it is in hindsight, a much better use of Uber’s cash on UberEats, and that’s a key driver of why he was able to go public.

Ming Maa: Yeah, I think it certainly extends beyond just the financial considerations as well. I think whenever a company expands to a new geography, by definition, their product development will slow down. And I think you saw that in companies like Uber. This isn’t just restricted to Uber, but you see this in many different companies in technology where I think the eye candy at the end of the day of being a global company tempts many founders to expand very rapidly.

But what you find very quickly is the incremental tax on product development, on engineering, on really understanding your customers at a very deep local level, becomes very high very, very quick. And so we look at great companies like Amazon, who operates only in a handful of companies, as an example of what to follow. Rather than going into every single country at once, focus on countries where you have a core competitive advantage, and then just stay very laser-focused on that.

Hans Tung : I think in the older days, companies from Silicon Valley try to do one thing really well and be very focused on a single purpose, and try to expand to as many countries possible. Those days, in my opinion, are probably over. You have local champions now growing up in different key emerging markets. Each one of them is becoming more of a super app and do a number of things well in order to retain customer loyalty. So companies in America also need to be more thoughtful about where to expand to, and what kind of totality of offering they want to provide to the consumers in the markets. I think that makes the world better for everyone involved.

Rita Yang : So one of the questions I raised from my mind during your conversation is, when a super app emerges, there are multiple ways. There is Meituan, who went from food delivery and then expanded into ridesharing and other services. And there’s also Grab, who started from ridesharing and ventured into other on-demand services. So those two paths, can you guys help us compare and contrast?

Ming Maa: Yeah, I think there’s no one-size-fits-all formula for what is the right way to start along the super app journey. I think for us the key observation was simply, when you look at the basic necessities and the basic problems that are addressing the vast majority of people in Southeast Asia, the first thing that comes to mind is transportation. Southeast Asia is a region where there is just terrible crippling traffic in many of the top cities that we live in. It’s a region where urbanization is much, much more quickly occurring than the ability for governments to keep up with infrastructure investments to support this growing population. And it’s a region where you have massive cities, massive infrastructure, opportunities to solve transportation.

So when you think about deep problems to solve, I think transportation was first and foremost what we identified as a problem that affects really literally everybody in Southeast Asia. And when you think about then, what does it take to become a super app? One of the key things is really frequency of usage and frequency of adoption. It’s about how engaged are your customers on your platform? Did they use you once a month? Twice a month, a la e-commerce? Or do they use you multiple times every single day? And what we noticed was in Southeast Asia, our customers, particularly our top cohorts, were using us multiple times a day. And I think that frequency of usage creates habituation. It drives behavior and creates the foundation for them providing other services on top, which then leads to the opportunity for a super app.

Hans Tung : Yeah, a lot of companies tend to focus either on gross GMV growth or unit economics, which is already improvement, but not as many are focusing on becoming more frequently used by consumers. It’s a very under-discussed point. So take us through when you guys were designing the super app — how do you increase the frequency of users, and what tradeoff decisions do you have to make? You want to sacrifice something else to make sure that the users transact through your platform, your app more frequently in order to create a stickiness for later users.

Ming Maa: Yeah, that’s a great question. At Grab, we have a saying that high frequency will always kill low frequency, and being very deliberate about the types of high frequency services that you provide is very core to how we think about designing the super app, and then the specific portfolio of services in each and every country. I think when you go through the list of potential services that you can offer, the expected frequency rates for each one, I think anyone in any venture firm can come up with a scatter plot of frequency versus transaction, and then you very quickly can identify the few transactions that really make sense.

But I think for us, it goes beyond just looking at scatter plots. You have to really think about the contribution of that service or that high-frequency usage to the overall platform. Now, what do I mean? A lot of payment companies will take a very quick shortcut to get to high frequency. The way that they’ll do that is by enabling P2P payments, where you send payments to your friends very quick. It creates a lot of behavior. It creates a lot of frequency. But fundamentally, it doesn’t create a customer base that is ultimately monetizable over time. And so you have to be very thoughtful about developing high frequency use cases that A) creates the right behavior on the platform; B) creates a value, so that we can then charge for the service, and then ultimately leverage is the overall platform, whether it’s our transportation network, whether it’s our payment rails. But thinking about the whole is always top of mind rather than thinking about very specific services by themselves.

Hans Tung : So when you look at your user behavior, what are the top or most popular usage cases that also has high frequency of usage?

Yeah. It’s really across the entire set of services that we offer. What you see — and it certainly depends by country — in Singapore, we see very high frequency usage behavior on ridesharing, on food delivery. In some more developing markets, we see very high usage behavior on SIM top-ups, on utility payments, because the availability of alternatives is much poorer than what’s available. So the key is, we give each of our country heads the ability to mix and match and to optimize the portfolio to make sense for their customer. And it’s only by experimenting country by country, and in some cases city by city, that you get the right portfolio of services for our customer set.

Hans Tung : Very curious to see how your CTO, how do they think about all of these trade-off decisions? Because they will roll out services or technology and realize that it doesn’t get the same scale that they hope for, and each country is all different.

Ming Maa: I agree. I think that the key to managing that is, as you mentioned earlier, just rapid experimentation and testing. I think we’re very clear on what we do and where we will partner with others. I think for hotel bookings, where there’s a massive offline presence required, boots on the street, where there are clear leaders in this space, then obviously it makes much more sense to partner with companies like Bookings. When it comes to very specialized products like micro-insurance, then it obviously makes sense to partner with companies like ZhongAn to create products for our marketplace. But what’s key is providing and creating that infrastructure layer in the APIs so that you allow third parties to rapidly experiment on the Grab platform and scale in a way that is sustainable, rather than having to do every single vertical by ourselves.

Hans Tung : Right. For a lot of American companies, there’s a lot of talk about having process and careful planning before doing something. And once the agreement is reached, people can focus on execution and get to drive for excellence.

But it seems like in emerging markets, with one example being Southeast Asia, the region is such a diverse place with different users in different geographies, different cities, different countries all have different needs. It seems like being fast and speedy is valued, even if they don’t only answers, wrote something out first. I mean, a user will tell you what works and what doesn’t work, is maybe potentially a better approach. How do you guys balance planning and fast iteration in order to achieve your optimal results?

Ming Maa: Well, I think the first thing to admit is, we are not the best at balancing that today. And I think the reality is, we are a company that evolves just like every other company. And during certain times, it makes sense to be very process-driven. In other times, it makes sense to be very focused on agility and speed to market, and the ability to change direction on a dime. I think part of this depends around the market nature in place during wartime versus during peace time. I think there are very different weightings around what’s the best effective way to drive decision-making. But I think at the core of it, we do have a set of processes around product development, around understanding the ROI for every product, every feature, understanding the tradeoffs between feature X versus product Y. Then it’s really a matter of degree of how deeply do we follow the process versus really understanding the advantages of agility in certain situations. So I think it’s always constantly evolving, we don’t get it right. And I would be very skeptical if anybody says they do get it right.

Rita Yang : So you just mentioned Grab has set its mind on becoming super-local since day one. Can you share with us, how is that philosophy reflected in your day-to-day job managing such a super app with so many different markets to overlook?

Ming Maa: I always remind folks that I joined the company. Southeast Asia is really one of the most diverse regions in the world. You have crazy rich Asians on one end of the spectrum, and you have Slumdog Millionaire, as you know, on the other, and everything in between. Now, I think what we try and do is, we really want to make sure that we have our ears and our eyes on the ground as closely as possible. What does that mean? It means that every year, all of our senior managers sit with drivers for half a day or a full day. It means that every year, all of our senior leaders sit in our call center and take customer complaints from either passengers or drivers.

And I have to tell you, there is nothing, nothing more humbling than getting a call from a customer in Singapore who perhaps was overcharged for a toll fee of 50 cents. That 50 cents may seem very small to you, but to that customer, it’s critically, critically important. On the other extreme, I’ve had investors who have just literally bought a brand new iPhone. They left it in the car and they subsequently lost their phone, and you spend days and days really trying to solve the problem. It really demonstrates how non-black and white running a company in a hyper-local scene can be.

But I think the key to remaining humble, remaining hyper-local and close your customers, is spending as much time as possible with our drivers, with our passengers, with our merchants, with our restaurants, and just understanding exactly what their problems are. And not dismissing the problems, but then really understanding what’s behind that and then finding a way to solve it.

Hans Tung : Right. We look at markets around the world and companies engaging in ridesharing and/or food delivery. Most of them are in the red because everybody’s rapidly expanding and also fighting off competitors with subsidies and so forth. Yet, Meituan-Dianping came out with a second quarter result that shows a positive net income partially driven by advertising revenue. It does send a positive message or signal that in a hyper-competitive market like China against the Ele.Me, Meituan-Dianping could still be a profitable quarter. What is your takeaway from that and what does that mean for Grab, if anything?

Ming Maa: I always say I think the public markets are a great forcing function for profitability. One of the best things to happen to the O2O industry is having great companies like Meituan, Lyft, Uber go public, because I think that sets the tone for many of the companies that remain private in understanding what is that path to profitability. What do investors expect over time, and how do you sustainably grow companies so that we can continue serving our customers for many, many decades to come?

I think for us, it is not about chasing after GMV. I think a lot of companies get trapped in this cycle of constant fundraising where they have to show persistent growth better than their peers. And what you end up with are companies that chase after any GMV, regardless of the quality, regardless of ultimately whether that GMV will become profitable. And one of the disciplines that we have really put into the entire company is really focusing on the GMV that matters. The GMV where we know we are serving our customers properly, we’re serving our customers, and therefore in return, these customers will become loyal and ultimately become profitable customers for us. And it’s by just constantly going after it and creating a larger and larger network each and every day that allows us to reduce incentives, provide better service to our customers, and create greater loyalty. And I think if there is one theme that we’ve seen in 2019, it’s just the volatility of public markets, the volatility of the investor markets. And that focus on being sustainable in the way that you grow business is a good thing for everyone in the industry.

Hans Tung : One of the key factors for growth would be recruitment and retainment and training of talent. Take engineering as an example. China has over 4 million STEM graduates a year. India has over 2 million, but everywhere else is somewhere between 100,000 to 600,000, the US included. As you build and scale in the region, you have built up R&D centers in Seattle, in Beijing, and also in Bangalore. How do you think about recruiting and retaining and training talent, and how do you leverage the competitive advantage of different places in order for you to keep up your requirements for scaling, and at the same time developing homegrown talent as well?

Ming Maa: I think there is certainly a need to expand globally from an engineering talent perspective, just given the lack of locally-grown talent over the last 5, 10 years. That situation will change over time as local graduates really see the opportunity in the Internet economy, and then increasingly are more open to taking risks and joining startups when they graduate from college. But at least in the last 5, 10 years, what I would say is the lack of talent has really forced us to go offshore in many different countries to identify the best and brightest in each niche geo. In Beijing, for example, we have wonderful, just fantastic geomapping talent in China that we can bring to bear in Southeast Asia to create the best mapping technologies in the region. And this is critically important, as you can imagine, because many of the roads in Southeast Asia are really not roads, but they are little alleys. The ability to map those alleys has been something that many of the international companies have been unable to do for quite the longest time.

In Seattle, we have some of the best user trust or anti-fraud teams in the world. Fraud is one of those items that very few people talk about, but it is one of the biggest issues facing developing markets where again, the quickest shortcut to taking growing a business is to go after a fraudulent business or business that ultimately is not a real customer. And I think within Grab, we have a firm belief that we go after real customers. We provide the best services, and we eliminate fraud as much as possible off of our platform. And Seattle is a place where we have most of our anti-fraud features or team developing the services. It’s gotten to a point now where we believe we have the industry’s best anti-fraud platforms in Southeast Asia, and we’re making it completely open to any other third party company, including our competitors who want to use our anti-fraud because we think it’s right for the industry. It grows you over on the street and we do it in a better way.

One of the benefits I think to being at Grab is, inherently, engineers are attracted to tough problems. And I think some of the problems that we’re tackling are some of the toughest in the world. I think when we look at the caliber of individuals that we’ve been able to attract from, whether it’s China, whether it’s the US, really speaks to the opportunity and the problems that we’re solving in the region.

Rita Yang : So looking back at your personal journey since joining Grab as its president, what are the most surprising learnings you have gotten or what are the most unexpected changes on your side?

Ming Maa: Yeah, I can speak hours and hours on this, because everything that I thought I knew we could throw away out the door and change. I think one of the biggest things I’ve learned is, it’s always better to make a decision even if it’s wrong, rather than wait for perfect data and not make a decision. And that’s very counterintuitive for most investors who want a lot of high fidelity data in order to support decision-making, whether it’s product, whether it’s market, whether it’s really everything under the sun. But one of the things that we’ve learned and I personally have learned is, keeping or having a company at standstill waiting for a decision can be one of the worst things to do for an organization. It’s always better to move and act and then pivot a little bit later if we decide the direction is wrong, rather than keeping the organization at a standstill.

Hans Tung : I think from my own experience as a failed founder, it seems like anyone needs to make a number of mistakes. You look at the right answers, you don’t try to experiment. You can’t just think there in a vacuum and come up with a perfect solution. So the faster you can make those mistakes without hurting yourself, the sooner you get to know what to do. Most investors like the demand precision. But it doesn’t exist on the front line, on the bottom line.

Ming Maa: Yeah, absolutely.

Hans Tung : What advice would you give to other young founders to thrive and be able to do well in Southeast Asia? If you have to tell them, here are the three or four things you absolutely have to watch out for and use them to guide your actions. What would those three or four principles or lessons be?

Ming Maa: Gosh, I think we would be the last people to ask for advice on this within Southeast Asia. But I think the first and foremost is, just really understanding the customer in a very deep, deep way. I think Jeff Bezos is famous for talking about customer centricity and avoiding a focus around competition. And one of the things that we’ve learned is, it is extremely easy to say. It’s extremely easy to put that on the poster, but it is really, really hard to ignore the noise and focus on really what matters. We’re all bombarded with just tremendous media in today’s age. And I think tuning out what really matters from, or rather tuning out what doesn’t matter from what does matter, is one of the most important things to lasting.

Rita Yang : Let’s wrap up this episode with a round of quickfire questions. Whatever answer comes to your mind, you can just say it. What’s the best piece of advice you have ever been given?

Ming Maa: The single best advice I’ve gotten is, always have a mentor, regardless of where you are, what your position is in a company. Always have that sounding board because we always get a little bit myopic at times, and having somebody out there to keep us grounded is so important to us.

Rita Yang : Last question. What is the best non-financial investment you have made in the past year?

Ming Maa: Non-financial investment? Gosh, I gotta say it’s probably my ping-pong table. I’m not particularly good at ping-pong, but what I would say is it’s a great way to spend time with my kids. I have three kids now. My oldest is getting into his teenage years when they stop talking to you. But when you’re playing ping pong, that’s when they really open up.

Hans Tung : That’s very, very good advice. I’m going to cheat a little and add one last question that I think a lot of people will want us to ask, but I’m saving it for last, which is, what’s it like working for Masa?

Ming Maa: Masa is one of the most amazing people I’ve had an opportunity to work with. And there’s no one way to describe it except two words that I would use. One is he is extremely non-linear in his thinking. Many people are quite smart. They have very fast CPU cycles in their head, but Masa understands the non-linearity in this world. The second is, he really understands the effect of compounding over time.

Hans Tung : Alibaba is a very good example. Yes.

Ming Maa: Exactly. If you take just the compounded growth rate of Internet data, stretch that out for 15, 20 years, you lead to some pretty non-obvious answers and results.

Hans Tung : Well said. Thank you so much, Ming. This has been a very fascinating podcast.

Ming Maa: Thanks for having me. Thank you.

Rita Yang : Thank you. For this episode on Grab, we also talked with our own Jixun Foo, a managing partner at GGV Capital. Jixun led GGV’s investment in Grab’s series B funding early on in 2014, and has served as a board member since then. Welcome to the show, Jixun.

Jixun Foo: Thank you.

Rita Yang : First of all, tell us how you met Anthony, the founder of Grab.

Jixun Foo: Well, I met Anthony back in, I recall, through an introduction of the earlier investor Vertex. I first met Anthony in a Starbucks in Singapore, in a place called Plaza Singapura, which is a shopping mall. I still remember I had Jenny and Hans with me at that time, and so we had a coffee with him. That was really my first meeting with him. Obviously he came and talked a little bit about his background and returning from Harvard, working for his family. And he had won this competition with his business plan for what at that time was called Grab Taxi. That was really the first contact point. And then soon after, obviously the team, Jenny, Hans, and I had a good impression. Then we had a follow-up session with him I subsequently had in Kuala Lumpur, because Grab literally started out in Kuala Lumpur in Malaysia in the early part of 2013. And so the next visit I had was in KL. Anthony came to the airport to receive me. It was a day trip for me. I went to his office, spent time with his team. Relatively small place, small team. I had met his mother as well at that time. So that was really my second touchpoint before we went in to do due diligence, and then later did the round of financing.

Rita Yang : You once said that what intrigued you about Anthony is actually his motivation in starting Grab versus inheriting his own family business. Can you tell us more about that?

Jixun Foo: Anthony is the youngest among the three sons in the family. And so he has a lot to show. He has a lot to prove, and you can sense his inner ambition when he talks. And the story I really remember is he talks about his grandfather, and the name goes by Tan Chong, and the grandfather started off as a cab driver. And how things evolve and change. He comes back to the point where he wants to make life better for a lot of the drivers, the people that, the community that makes the experience more convenient for passengers and makes life better for the drivers. So it goes back to when he talks about his grandfather, it’s really the underlying roots of why he wants to do it and making things better. And very importantly, there’s that underlying sense of drive and trying to prove beyond that he’s not just because of his inheritance, but his own capability that he can make a difference.

Rita Yang : Now, take us back to 2014, the year you decided to be the lead investor in Grab’s series B. What were some of the noises from the right-hailing markets you needed to ignore, as well as some signals that you think have helped inform that decision?

Jixun Foo: There’s a lot more noise in China, in the US. In the US you have Uber and Lyft, and in China you have Didi and Kuaidi. And you’ve seen how fast they grow and you’ve seen how much capital they have raised and how much burden they are sustaining. And it’s kind of scary, the amount of capital you need to build those businesses. The fact remains that Southeast Asia is still a smaller economy compared to — a much smaller economy compared to the US or to China. You have 10 countries, but you have fragmented city-states and countries by culture, by religion, by language, etc. It’s a very complex market, a smaller market, a complex market. So why bother, right?

So I think that what I really look beyond, number one, I think because of the complexity, therein lies the opportunity. And I think in many ways, Anthony is different because he’s got his family relationships and connections that give him an edge and leverage, number one. Number two, I think his training in the US gives him a network of friends that could join him and work with him with different — he has classmates from Harvard from the Philippines, from Vietnam, from Indonesia, etc. And so he can connect through this network and assemble the talent necessary to address that fragmentation in the market.

So I think it’s very important where we look at the noises, it poses certain challenges. But at the same time, the question is, would the entrepreneur have what it takes to address those noises? And if they do, then it’s an opportunity.

Rita Yang : And in the same year of 2014, you actually also led GGV’s investment into Didi, series D. What can these two deals tell us about your investment thesis for that year, or even until now?

Jixun Foo: We have always liked Didi and I’ve always liked Chung Wei, and then we got to know Wang Gang really well. Over the years, we became really good friends. Fundamentally I think for GGV, we are very thesis-driven investors, meaning while we identify with the thesis, we understand the fundamentals of the thesis, and we will pull capital, invest in the capital. And the fact is that we are multi-stage, we are stage-agnostic. We could be only series A, we can be series B, series C, series D, and we have the capital base, because our fund is $1.9 billion, $1.88 billion to be exact.

We have the capital base to go multi-stage. So that makes us unique and our thesis approach makes us unique. So on that same note, we can invest. I think the underlying thesis is, as long as we identify with the right entrepreneur, we’ll go all in. So where does Didi, Grab follow by? They fall into that same line of thesis. If you look at Qunar, Airbnb, and Tujia, they fall into the same line of thesis, meaning they are all belonging to that one area where we say ok, shared economy, how is that going to work? How does that unique economy work? If it does work, how big can it go? So if we get conviction around it and get conviction on our entrepreneur, we can invest across stages, and we think we can make money across stages.

Rita Yang : Did you have any role in getting Didi to invest in Grab? Is that something you intentionally pushed for?

Jixun Foo: Not exactly. To be fair, I think that a lot of the integration credit goes to Masayoshi Son, the Vision Fund. They had invested in their big investor after ours and after GGV and Tiger, Vision Fund’s Masayoshi has become a big investor in Grab. They’ve also been a big investor in Didi, and instrumental in the so-called Didi-Kuaidi merger, and subsequently instrumental in Didi’s investment in Grab, and also Grab’s merger with Uber Southeast Asia respectively. So I think I would give more credit to Masa for consolidating the market and giving them the ammunition to consolidate the market. And we’ve been playing a supportive role in that sense, supporting that integration.

Rita Yang : Ming actually mentioned in the episode you were quite persistent in the board meetings to push Grab into going into payment. Can you tell us what was your thinking behind that, and what were some of the concerns about going into payment from Grab’s perspective back then?

Jixun Foo: What’s interesting is, if you look at Grab’s business — Grab, among all the various so-called unicorns in Southeast Asia, is probably the only one that has the most diverse touchpoint. They were able to address and scale across 240 cities in Southeast Asia, across multiple countries, multiple markets, and that’s really impressive. The reason why I want to paint that as a backdrop is because it is that reason that gives Grab a very unique touchpoint with consumers across the region. And the fact that the ridesharing business, in my view, would have a ceiling at some point, even though they continue to grow. After seeing the movie I’ve seen in China, when you see Ali going into Ant Financial and WeChat going to WePay, you start to say, hey, who is going to be the so-called Alipay or WePay in the region? And what are the prerequisites for that?

You have to have flow in your transaction. You have to have transactional flow in your services, Grab has that. They have transactional connection among their consumers. And very importantly, how do we make the service and experience better for the consumers in Southeast Asia? Because if you have to call a cab through an app and you have to pay in cash, there’s still friction. There’s still friction to your experience, meaning you still have to dig out your wallet and pay the driver. So the point I’m really trying to push for is multifold. One is you have the touchpoint, two is you deliver a better experience by doing GrabPay, because that will literally help to smooth out the experience for your consumers. And three is, you raise the ceiling of your potential by moving into a new service, which is payment.

So Ali is powerful. Alibaba is powerful, not just by way of Taobao, but it has a seamless experience with Ant Financial and Alipay. And I think that analogy is very similar for Grab, if you want to deliver a seamless experience and you also can grow bigger with your payment services. And I’ve been pounding that for years, like at the board meetings and saying we should do this, we should do this. Now, having said that, it’s not easy because you need talent. You need people. You need understanding. And so given the talent that we have in Grab, you need to also find relevant talent. So to find those relevant talent in Southeast Asia is not that easy. So we’ve been on the talent hunt for a while before we identify Jason Thompson to help come lead the effort at Grab.

Rita Yang : You just mentioned the variety of services Grab has. If we look at Grab and Didi, they started with similar models and went through a very distinct growth path. Didi focuses more on different modes of transportation, while Grab gradually evolves into a super app model. Can you help us understand the reason behind that?

Jixun Foo: Well, I think it’s again, it’s really because of the state of the market. Didi emerged with Alibaba, Tencent, Baidu, JD, and Meituan, and it’s a multifaceted market with lots of competition. You have to look at — they emerged and they are playing in the land where there are already giants, tech giants. So you have to therefore find space and gaps and see where can you compete better and where can you excel better. So naturally, I think Didi is more focused on transportation going on multiple transportation products, services, and they tried many things up and down their value chain. That’s number one.

Number two, the China market is big. Even as a transportation fabric or transportation network, it’s big enough to sustain a fairly big unicorn in China. Southeast Asia is a bit different. Like I said, some of their issues are fragmentation, the scale and size of the market is different. Their GDP per capita is lower, the population size smaller. So you are playing a different field, and you’re also playing in a different landscape. You have less giants, so to speak. I mean, Grab is the giant, so to speak, and so therefore it’s natural for Grab to go horizontal and into more services because you want to have more consumers on your platform. You want to become the local services platform beyond ridesharing into food takeout, delivery services, etc., and eventually into payment and financial services. So that’s the environment, the market, the landscape allows you to do that. The scale and the size of the market requires you to do that.

Rita Yang : Jixun, you have always had a thing for mobility as an investor. Your portfolios include Didi Chuxing, Xpeng, Hellobike, and Grab. A bit curious, where does your fascination for transportation come from?

Jixun Foo: Well, I don’t know. Maybe sometimes when your foot is in one, you start to step foot in another and just keep moving along. And I think that’s part of how we approach the market as partners of GGV, not just for myself, but Jenny and Hans and Eric. Jenny is very focused on education and she’s invested in Liulishuo, she’s invested in Zuoyebang, she has invested in Huohua Siwei, and many more. So the whole idea is, as you step foot, you understand the landscape. You continue to stay on top. If you can continue to stay ahead of the curve and the innovation curve, you can stay ahead of the game. That’s what made GGV unique. And maybe because I like cars, I like travel, too. So it’s part of my passion.

Rita Yang : Last question. When looking at mobility companies, what do you actually look for, or say if there are companies who are thinking about doing a startup or want to pitch their business idea to you, what should they be telling you?

Jixun Foo: Yeah, I’ve seen a lot of mobility businesses. Mobility in China, mobility in Southeast Asia. Recently we spent quite a bit of time in India. We met quite a few of the mobility companies, the Bounce, the Yulu. I might not be able to remember one or two names, but the point here is that the underlying business is actually quite straightforward because it’s about an asset. You want to share the asset. The economics of that sharing has to make sense, meaning having that assets and drive, having a shared economy concept on top of that, is that you drive utilization of the asset up. But having said that, your cost of maintenance, cost of operation, cost of usage, etc., and effective utilization at the end of the day has to also make sense.

So this unit economics equation, if you will. If it makes sense, if you can work out the economics on — and bear in mind that a lot of times when you look at these numbers, you have to look at a mature state or a steady state, maybe that’s a better word. At a steady state, where you have enough cars or you have enough bikes on the street. You cannot look at it with a small number because the saturation curve will drive utilization down. And at the steady state, you have to make the economics work. That is the underlying thing for me.

So when we chose to invest in Hello, when we chose to invest in Grab and these auto companies, it all comes down to these very basic equations. It’s quite easy to understand but it’s very hard to do and to do it right. Some people ask me, hey, is Hellobike really a technology company? I say, yeah, absolutely. There’s so much technology embedded into locating the bike, geofencing, into creating a system to have a very high operating efficiency. So a lot of technology is being applied. Let’s just say, from a consumer perspective, you don’t see it, you don’t see it.

Rita Yang : This is great. Thank you so much, Jixun.

Jixun Foo: Thank you. Thank you, Rita.