- In Vietnam, where businesses—including competitors Grab and Gojek—struggle to retain drivers due to COVID issues and growing gasoline prices, clients are reportedly practically fighting for rides. Deutsche Bank has given ride-hailing company Be Group $60 million.
- Additionally, Be Group competes with Gojek in the food delivery market and has a digital bank.
Ho Chi Minh City, Vietnam, where businesses, including competitors, Grab and Gojek, find it difficult to recruit drivers due to COVID issues and rising gasoline prices, ride-hailing service Be Group has received a $60 million loan from Deutsche Bank. Customers there are reportedly practically fighting for trips.
Be Group announced on Monday, 5th September 2022, that it would use the money to grow three services — pick-up and delivery, online banking, and motorbike- and car-hailing — and has the option to loan an additional $40 million. While startups generally have not yet demonstrated viable business strategies in the ride-hailing sector, the app creator stated that it aims to generate a profit this quarter.
Moreover, businesses have not yet demonstrated that super apps are in demand outside of China, a market that Be Group seeks as it expands its offerings to include insurance and telecoms.
Since the COVID pandemic has shutdowns drove drivers out of the taxi and ride-hailing industry during the past year, the uphill struggle for transportation has been even more difficult. When it became difficult to pay back their debts due to a lack of clients, they either gave up their automobiles or fled to remote areas once Vietnam ended the lockdowns, or they did both. The gas price, which drivers generally paid out of pocket, increased when Russia invaded Ukraine.
Unlike the Indonesian and Malaysian startups Grab and Gojek, both publicly traded, Be Group is still a private firm. The Vietnamese technology platform was previously financed primarily by its creators, and it has stated that it will not waste funds to acquire customers "similar to certain competitors."
"Despite the challenging competition landscape, I believe that Be Group is well inspired and supported to attain our medium and long-term ambition as a leading local tech company," said Be CEO Vu Hoang Yen.
"As Vietnam's economy continues to thrive, we see many opportunities to partner with our clients to support their growth," said Sreenivasan Iyer, Deutsche Bank Southeast Asia head of investment banking coverage.