The top two most innovative companies in the world are from Asia, according to Fast Company, a US business magazine, in the latest sign that the West is waking up to the fact that a lot of innovation today is taking place beyond Silicon Valley.
China’s Meituan Dianping, which offers an app-based service that expedites the booking and delivery of services such as hotel stays, movie tickets and food, has taken Apple’s crown as the world’s most innovative company in Fast Company’s 2019 ranking of the world’s 50 most innovative companies.
Immediately behind Meituan Dianping’s No 1 position is Singapore-based Grab, a ride-hailing company that has expanded to offer its 130 million users not only food delivery and travel booking but also financial and other services.
Dubbed by Fast Company as “transactional super apps”, both Meituan Dianping and Grab are recognised for the changes they have brought to hundreds of millions of Asian consumers. This not only relates to buying food and booking hotels but also the transformation the companies have brought to local businesses in terms of digitising their operations and fuelling their growth and expansion.
“The reason that transactional super apps take root in Asia, China in particular, is because of the well-established mobile internet infrastructure and the popularity of mobile payments in the region,” said Zhang Yi, chief executive of research firm iMedia. “In terms of payments in the US, the credit card still rules.”
The 2019 ranking is the first time a non-US company has been chosen as the world’s most innovative company since Fast Company started compiling the rankings in 2008, reflecting the rise of innovation in regions beyond Silicon Valley, particularly in Asia.
“They may not be well known in the US, but Meituan and Grab are changing the lives of hundreds of millions of consumers and millions of merchants with highly complex operations disguised as simple transactions – elegant tech to enable real-world experiences,” Fast Company wrote in an article published on Wednesday, explaining the rationale behind the ranking.
Having facilitated 27.7 billion transactions worth US$33.8 billion for more than 350 million people in 2,800 cities in the first half of 2018, Meituan Dianping is one of China’s biggest on-demand services providers. The sector has been the cradle for some of the country’s biggest tech companies, including ride-hailing giant Didi Chuxing and bike-rental firms such as Ofo. Beijing regards on-demand services as one of the important sectors to build in its plan for an innovation-driven economy.
“China is a particularly conducive market for the robust development of on-demand services: there are multiple, high-population-density cities that allow for economies of scale in delivery, there is an enormous supply of relatively cheap labor and uptake of mobile payment solutions like WeChat Pay and Alipay has eclipsed that in markets like the US and Europe,” said Mark Natkin, managing director of Marbridge Consulting.
Fast’s widely followed list, compiled by its editors and writers across 35 industries and every region, ranks US company NBA third, recognising its ability to “give every fan a courtside seat”.
US tech giant Apple, which has often topped the rankings including 2018, fell to 17th spot this time as it “did not really break new ground with their devices, and hardware sales were sluggish”, Fast Company senior editor Amy Farley was quoted as saying to CNBC on Wednesday.
Despite the far-reaching impact of Beijing-based Meituan Dianping it has yet to turn a profit although analysts have projected that it will move into the black next year. Singapore-headquartered Grab is currently expanding beyond its core ride-booking business into the newer field of financial services.