Common Tread

A phone app and humble scooters add up to big business in Indonesia

Mar 06, 2018

In a recent round of fundraising, Indonesian startup GO-JEK raked in $1.5 billion for its motorcycle ride-sharing and delivery service.

The idea of jumping on the back of a small motorcycle or scooter with a total stranger and minimal protective gear and squeezing through incredibly congested traffic may cause some hesitation among Westerners, but that hasn't deterred investment. Google was among the 12 investors that saw promise in GO-JEK’s vision for hired riders. The startup, which is now worth $5 billion, fits in just fine with Indonesia's culture and creates a highly local form of personal mobility, giving it an advantage over outsiders like Uber.

In Indonesia, scooters (called ojeks) are often the fastest way to get from place to place. Cabs are easily caught in traffic, especially in Jakarta, and their fares are much higher. A typical ojek ride is the equivalent of a couple of dollars or less. Before GO-JEK, operators could be found idling on street corners, waiting for customers. Right place, wrong time. GO-JEK saw an opportunity to connect riders and passengers in one of the world’s most congested countries, but they've continued to innovate beyond that start. 

Still want to take a cab? Tutatu Indonesia photo.

The idea began with just 20 bikes and a call center, but now GO-JEK manages a fleet of 200,000 riders. Their app, launched in 2015, was initially limited to Uber-style ride hailing, but the company has since expanded into new services. Users can now hire couriers, order food, dispatch personal shoppers, or even call in a massage. Prices are calculated through the app and payment goes through GO-JEK’s Go-Pay mobile payments service. 

"We look great in these green helmets!" Tutatu Indonesia photo.

GO-JEK's focus on two-wheelers means the rider pool stays large, since the system works with just a scooter and a smartphone. It's a way for scooter owners to make more money and customers to gain convenience, whether ordering take-out or getting home from work. Western tourists who aren't afraid to hop on the back of a stranger’s scooter are assisted by GO-JEK in bridging language barriers. If riding pillion really isn’t your thing, GO-JEK can summon a traditional taxi, too. After a few hours in traffic, however, you might start to envy the little bikes leaving you in the dust.

As cities around the world struggle to keep up with growing populations (the Dutch only intended 800,000 people to live in Jakarta when they laid it out), services like GO-JEK can provide income for riders and convenience for customers, without adding to congestion, all by combining new ideas with tried-and-true tech like the humble scooter.