Google‘s push into eCommerce is taking it to Indonesia, where online shopping is growing at explosive rates in the wake of the coronavirus pandemic.
The Alphabet unit and Singapore’s state investment firm, Temasek Holdings Pte, have agreed to pump $350 million into PT Tokopedia, a giant Indonesian eCommerce hub, according to Bloomberg, which cited sources familiar with the deal.
The aim of the investment is to help fuel a burst of expansion for the Indonesian online shopping hub, which, like many of its counterparts across the world, has seen a surge in activity in the wake of the coronavirus crisis.
The deal builds on previous backing of the top Indonesian startup – second only to Gojek – by two investment tycoons: Masayoshi Son, founder of SoftBank, and Jack Ma, co-founder of Alibaba, the news service reports.
Google’s decision to throw its backing to Tokopedia comes as U.S.-based tech giants look increasingly to Asia for new growth as they tap out American and European markets.
Indonesia is undergoing a major eCommerce boom. The amount of money spent online is expected to nearly quadruple by 2025, when it is projected to hit $82 billion, according to the news service, citing a study from Bain & Co., Temasek and Google. That’s up from $21 billion in 2019.
The final deal documents have yet to be signed, though the closing of the agreement is expected to come soon, Bloomberg reported.
However, Tokopedia may be in the market for additional investors: Back in July, the startup was reportedly on the hunt for $500 million to $1 billion.
SoftBank’s Vision Fund and Alibaba Group Holding teamed up in 2018 to pump $1.1 billion into Tokopedia.
“We see our mission, to make it easy to do business anywhere, reflected in Tokopedia’s journey,” said Finance Manager Kenny Ho at Alibaba at the time.