Google and Temasek are Reportedly Investing in Tokopedia
The e-commerce unicorn, Tokopedia, is reportedly getting fresh funds from United States-based internet giant Google and Singapore-based investment company Temasek Holdings. The total value is US$ 800 million or around IDR 11.7 trillion.
The news about Temasek and Google investing in Tokopedia has been going on since last June. At that time, VP of Corporate Communications Tokopedia Nuraini Razak was reluctant to respond to these rumors. Last July, a Bloomberg source with knowledge of the funding plan said that the SoftBank Vision Fund had discussions with Tokopedia regarding investment.
The national unicorn was also said to be holding talks with Facebook, Microsoft and Amazon. He also said that Google and Temasek were the investors most actively negotiating with Tokopedia.
Meanwhile, in February, Nuraini said that Tokopedia was targeting investors who could provide added value, such as Alibaba, SoftBank, and Sequoia Capital. “It is not only a matter of money but also the best practices. How is the application of technology or business from Alibaba elsewhere, for example,” he said, at the beginning of the year (19/2).
Therefore, when the company finds suitable investors who can provide added value, it will conduct funding. “It is the right time for us to add partners (investors),” said Nuraini.
Want to Attract New Investors before IPO
Previously, Tokopedia CEO William Tanuwijaya also hoped to attract new investors before offering an initial public offering (IPO) on two exchanges, namely Indonesia and other countries. Although it did not reveal the exact time, Tokopedia is said to be going IPO in 2023.
Tokopedia, opens plans to list its shares on the Indonesian stock exchange. However, it’s not yet certain which country the corporate will target on the stock market.
It will certainly be able to raise the stock market capitalization on the Indonesia Stock Exchange (IDX) significantly, if this company decides to be listed on the domestic stock exchange. Please note, at least currently Tokopedia has a valuation of US $ 7.5 billion (IDR 111 trillion, assuming an exchange rate of IDR 14,800 / US $).
Tokopedia CEO William Tanuwijaya said the valuation value was achieved thanks to the public’s trust in the company which has succeeded in bringing many investors to invest in the company.
“Even if IPO, the valuation represents public trust, like that,” William said at the Capital Market Summit & Expo 2020 which was held virtually, Wednesday (21/10/2020).
The Company is Preparing for IPO
Based on data presented by the BEI Commissioner Pandu Patria Sjahrir, Tokopedia’s valuation is that the second largest among the highest four Indonesian unicorns. The first position is filled by Gojek, which is estimated at US$ 10 billion, then there is Traveloka for US$ 2.7 billion and last by Bukalapak for US$ 2.5 billion.
Pandu revealed that if these technology companies can list their shares in the country, they will be able to increase the market capitalization (market cap) on the IDX and the transaction value on the stock market.
“When you enter, if you check out the composition of MSCI outway to technology and lots of public investors see the technology sector, the upside potential of this company is sort of large, so the market’s cap can increase,” said Pandu at the same opportunity.
He said that the potential for this large transaction value is reflected in the value of transactions in the private market associated with these types of companies whose value could reach US$ 2 billion-US$ 3 billion per year.
The present attractiveness of investors, especially foreigners, is that they like stocks within the technology sector. This will be seen from the ranks of the ten best stocks on Wall Street which are widely controlled by this sector.