Barely a year prior, he had successfully convinced ride-hailing major Uber, which had launched in Vietnam in 2014, to integrate with MoMo. Uber only accepted credit cards back then, just like it did in the United States and other markets. However, very few Vietnamese had credit cards at the time, so Tuong pitched a tie-up with Uber, wherein people could pay for their rides via MoMo. This would give Uber access to more customers, along with an added payment option.
After three years of negotiations, in 2017, Uber finally agreed to make MoMo only its second e-wallet partner in the world. It was “a real game-changer for us”, Tuong told The Ken. However, his happiness didn’t last long. The following year, Uber sold its Southeast Asia business to Grab, whose GrabPay platform is MoMo’s direct competitor. “I was shocked and couldn’t even eat for a couple of days,” said Tuong.
A weakness is that, unlike Zalo or Shopee, we don’t have our own use cases
“At that time, we were raising our Series C funding, and a lot of the pitch was around Uber. We lost it overnight.” While the Uber-Grab deal was an exceptionally big merger, allegiances among tech companies, their backers, and partners are constantly shifting. Especially when some platforms grow bigger and bigger, which encourages further market consolidation.
It’s entirely possible that MoMo loses more of its important revenue partners in the future, or stays locked out of rivals’ ecosystems. The company has shown no intentions of entering the ride-hailing, food delivery, and e-commerce sectors by itself. How long will it be able to continue like this? “Every single investor in the last 10 years comes asking exactly the same question: how on Earth are you going to compete?” said Manisha Shah, MoMo’s CFO.
“I think that’s our platform mindset, which is different from a domination mindset.” Shah added that being an independent player has its strengths and weaknesses. “A weakness is that, unlike Zalo or Shopee, we don’t have our own use cases, but that can make other places lazy. Being on our own is harder, but we can capture the remaining market. So, if you use ShopeePay, you can only use Shopee, but MoMo has partnered with Sendo, Lazada and Tiki.”
Cap table MoMo’s other backers include Warburg Pincus, Ward Ferry Management, Goodwater Capital, and Kora Management. It had raised US$100 million in January 2021 MoMo claims that the loss of Uber benefited the company in the end, since its tech, business and legal teams had learned new skills while working with their more experienced American counterparts.
“We used that to go talk with Facebook, Apple, and Google, and gradually we got them all,” said Tuong. “Now, we are the first e-wallet in Vietnam to have integrated with the Facebook Marketplace, the Apple App Store, and Google Play.”