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The Evolution and Regulation of Social Commerce in Indonesia: The TikTok Shop Ban

October 5, 2023Feature, OpinionOrderfaz, regulation, Reynaldi Gandawidjaja, Social Commerce, tiktok shopGuest Post

The digital revolution has reshaped the way we shop, with e-commerce and social commerce taking center stage. Indonesia, with its burgeoning online population and rapid digitalization, has emerged as a hotspot for e-commerce growth. In particular, the rise of social commerce, epitomized by platforms like TikTok Shop, has been a game-changer in the Indonesian market.

However, recent regulatory developments have cast a shadow over this thriving sector. In this article, we will delve into the growth of e-commerce and social commerce in Indonesia, the prominence of TikTok Shop, and the implications of the ban regulation on this innovative marketplace.

The explosive growth of e-commerce and social commerce

According to We are Social (January 2023), Indonesia boasts a total population of 276.4 million, with a significant digital presence as 77% of its populace, totaling 212.9 million individuals, are internet users. Among these, a remarkable 60.4% or 167 million people are active on social media platforms. What’s striking is the level of engagement, with the average Indonesian spending an impressive 3 hours and 18 minutes per day on social media through various devices. These statistics underscore the nation’s substantial online presence and its robust social media culture, making it a key player in the digital landscape.

E-commerce in Indonesia

Indonesia’s e-commerce landscape is on a meteoric rise. According to predictions by experts, the Gross Merchandise Value (GMV) of the e-commerce industry in Indonesia is set to soar to $104 billion by 2025. This growth is fueled by a staggering 158.6 million e-commerce users, representing 57.9% of the total population, as per the Social Commerce Report 2022 by DSInnovate.

Social Commerce in Indonesia

With 60.4% of the population being active on social media platforms, this colossal user base has provided fertile ground for the emergence of social commerce, where buyers and sellers can interact freely and transact directly on social media platforms. This novel approach to shopping has attracted a massive following, with social commerce transactions contributing approximately $3 billion to Indonesia’s total of $8 billion GMV in 2020, as stated by Digitalpreneur Diatce G. Harahap , as stated by the Digitalpreneur Diatce G. Harahap on the Spire Insights article by technobusiness.id.

E-commerce vs Social Commerce

In line with a report titled “E-commerce in Southeast Asia 2023” released by Momentum, the cumulative sales value of TikTok Shop in 2022 did not achieve the top spot in Indonesia. According to this data, the GMV in Indonesia, encompassing six e-commerce platforms, reached USD 51.9 billion or IDR 803.7 trillion. The report disclosed that sales on TikTok Shop only contributed to 5 percent, which equates to approximately IDR 40.1 trillion in 2022.

TikTok Shop still trails behind Shopee, which maintains a dominant position in e-commerce revenue within Indonesia. Shopee managed to amass a total revenue of 36 percent or IDR 289.3 trillion from the sale of goods. Following closely are Tokopedia, Lazada, and Bukalapak.

Interestingly, sales on TikTok are on a steady upward trajectory despite not leading the pack. Shoplus, an analytics tool for TikTok, reported an upswing in supply and demand within the TikTok e-commerce sphere during the fourth quarter of 2022. In December 2022, the number of creators on TikTok Shop surged by 92 percent in comparison to October, and during the same timeframe, e-commerce-related videos registered an impressive increase of 127 percent.

It is worth noting that the proliferation of influencer-based e-commerce activities, as per the report, played a pivotal role in broadening TikTok Shop’s content and expanding its reach. Consequently, the proportion of e-commerce influencers in total sales revenue in Indonesia has seen a substantial surge. The count of TikTok Shop influencers reached its zenith in December 2022, which subsequently sparked fierce competition in Indonesia.

In the fourth quarter of 2022, sales generated by TikTok Shop influencers constituted 34 percent of the total sales in TikTok Shop Indonesia, making Indonesia the leader among other countries. Shoplus, in general, indicated that 8.4 percent of TikTok Shop influencers accounted for a significant 86.9 percent of the market share during the same period. In Indonesia, influencers in professional services, finance and investment, fashion, vlogs, and other niches rapidly garnered followers.

To provide context, according to CNBC Indonesia, the Gross Merchandise Value (GMV) on TikTok Shop in Indonesia over the past year tallied at US$ 2.5 billion. This figure formed the majority of the total GMV in Southeast Asia, which amounted to US$ 4.4 billion. This implies that TikTok has set its sights on transactions worth over US$ 5 billion (IDR 75 trillion) in Indonesia for 2023. This information stems from credible sources familiar with the matter. On a broader scale, the GMV of TikTok Shop for all of Southeast Asia is projected to exceed US$ 15 billion, marking a remarkable triple-fold increase from the previous year.

The emphasis on Indonesia is not without reason. Insider Intelligence’s research firm reported that by Q1 2023, active TikTok users in Southeast Asia had reached a staggering 135 million, with Indonesia contributing a significant chunk, boasting 113 million users. The potential of TikTok Shop has not escaped the attention of established e-commerce giants like Shopee, Tokopedia, and Lazada, despite TikTok Shop’s relatively recent introduction to Southeast Asia in 2021.

According to a survey by Cube Asia, users’ spending habits have shifted away from platforms like Shopee and Lazada in favor of TikTok Shop. User spending on Shopee, Lazada, and offline stores in Indonesia, Thailand, and the Philippines witnessed declines of 51 percent, 45 percent, and 38 percent, respectively. Nevertheless, it’s crucial to note that Shopee still maintains a significantly higher GMV than TikTok Shop, with Shopee’s Southeast Asia GMV reaching US$ 73.5 billion in 2022, while Lazada achieved a GMV of US$ 21 billion.

The Rise of TikTok Shop

Among the array of social commerce platforms in Indonesia, TikTok Shop stands out as a frontrunner. Alongside Facebook Shops and Instagram Shopping, TikTok Shop offers a unique blend of social media engagement and direct shopping. A Populix survey conducted in 2022 revealed that TikTok Shop is the preferred platform for the majority of Indonesian respondents who have shopped via social media. This thriving marketplace caters to a diverse range of products, with clothing, beauty products, food and beverages, and cellphones and accessories topping the list of items frequently purchased.

Challenges for TikTok Shop in Indonesia

Despite its rapid growth, TikTok Shop faces formidable challenges in its quest for sustained success. According to experts at Cube Asia, TikTok must operate flawlessly to achieve its GMV target of US$ 15 billion in Southeast Asia. Recent challenges include regulatory scrutiny, such as the Vietnamese government’s investigation into TikTok for disseminating negative content, and the Indonesian Ministry of Communication and Information blocking content related to “online begging.”

Jianggang Li, CEO of Momentum Works research firm, underscores that regulatory challenges aren’t confined to TikTok in the United States and Europe. TikTok must convince governments in Southeast Asia that its service benefits the local population and SMEs.

Additionally, TikTok Shop faces challenges related to product pricing and limited logistics. Products on TikTok tend to be lower-cost, leading to impulsive purchases. For pricier items like electronic devices, TikTok has yet to gain preference. Moreover, TikTok Shop relies on third-party courier services, and Indonesia’s archipelagic nature often poses logistical challenges, particularly for deliveries to remote islands.

Roshan Raj, Head of Research at Redseer, notes that customers outside Java may feel underserved by TikTok Shop, as established e-commerce platforms possess stronger internal logistics capabilities. Consequently, TikTok’s delivery ratings still trail behind those of established players.

Looming Competition

These challenges present opportunities for established players like Shopee, Tokopedia, and Lazada to solidify their positions. The Financial Times reports that Lazada, led by Jiang Fan, has secured additional funds from Alibaba to bolster its competitive strategy. Shopee, on the other hand, is anticipated to intensify competition after two consecutive profitable quarters. The e-commerce landscape in Southeast Asia, particularly in Indonesia, is set to witness intriguing developments in the coming year.

An In-Depth Look at the Ban Regulation

In an unexpected turn of events on September 25, 2023, the Indonesian government unveiled a significant policy shift by implementing a comprehensive ban on e-commerce transactions conducted through social media platforms, as outlined in Regulation of the Minister of Trade (Permendag) No. 31 of 2023. Trade Minister Zulkifli Hasan, in a statement to the press, highlighted that the primary objectives of this regulation are to foster “fair and just” business competition while also safeguarding the data protection rights of users. This multifaceted approach aims to address a variety of pressing issues affecting Indonesia’s business landscape.

Impact on Local Business

One prominent concern that led to this ban was the adverse impact of social media-based e-commerce on the local small and medium-sized enterprises (SMEs). The rapid influx of imported goods, particularly from China, through platforms like TikTok Shop disrupted the equilibrium of the market. Traders in Tanah Abang, Southeast Asia’s largest wholesale center, voiced their grievances, reporting a staggering profit loss of over 50 percent due to their inability to compete with imported products offered at significantly lower prices on TikTok Shop.

In a recent interview with Temmy Satya Permana at tvOneNews, Assistant Deputy of Financing and Investment for Small and Medium Enterprises (SMEs) at the Ministry of Cooperatives and SMEs in Indonesia, it was revealed that Indonesia ranks as the world’s second-largest TikTok user base, with users spending an average of 3.5 hours per day on the platform. TikTok had already become a widespread habit among Indonesians even before it received official permission in May 2023. Surprisingly, he added that within just one year, TikTok’s revenue matched that of Alibaba’s 10-year earnings in China. However, concerns about pricing have emerged, as some items, such as shoes and hijabs, were sold at extremely low prices, with a majority being imports. The World Economic Forum reported that Indonesia is the largest buyer of hijabs globally, with 75% of these products being imported.

Impact on Offline Business

Moreover, the “live” feature on TikTok, enabling individuals to directly sell goods, was deemed detrimental to local MSMEs that predominantly operate offline. Iyal Suryadi, a textile seller, expressed frustration over the situation, highlighting that the prices of items sold on TikTok Shop “do not make sense.” This is because goods are sold directly to consumers at factory prices, bypassing distributors or resellers, disrupting the traditional business model.

Misuse of Personal Data

Another factor that drove the Indonesian government’s decision to prohibit e-commerce transactions via social media channels, including TikTok Shop, was the need to prevent the misuse of personal data. Trade Minister Zulkifli Hasan (often referred to as Zulhas) shed light on the necessity of this move, emphasizing the clear distinction between social media and social commerce. He asserted that social commerce should serve as a platform for promoting and directly selling goods and services, separate from the broader realm of social media.

The amalgamation of social media and social commerce raised concerns about a potential monopoly over algorithms, which could be exploited to misuse consumer personal data for business purposes. Minister Zulhas underlined the importance of segregating these realms to prevent such misuse. By implementing the ban, the Indonesian government sought to maintain a clear boundary between the two and safeguard the integrity of consumer data.

No PMSE Permit

Furthermore, another significant reason for TikTok Shop’s closure was the absence of a necessary Trading Through Electronic Systems (PMSE) license. TikTok, despite being a widely used social media platform in Indonesia, was registered as an Electronic System Provider (PSE) with the Ministry of Communication and Information Technology (Kominfo). However, it lacked the requisite PMSE license, a critical permit for conducting e-commerce transactions through electronic devices or procedures.

The distinction between PSE and PMSE licenses is essential. PSE licenses encompass the use of electronic systems for both public and non-public services by state administrators, individuals, businesses, and the general public. In contrast, PMSE licenses are specifically tailored for online trading activities carried out through electronic means, essentially enabling companies to engage in e-commerce.

Tragically, TikTok Shop’s absence of a PMSE license rendered it incapable of facilitating direct buying and selling transactions on the TikTok platform. In light of these regulatory and compliance issues, the Indonesian government’s decision to ban TikTok Shop aligns with its commitment to upholding legal and data protection standards while fostering a fair and competitive business environment within the country.

Impact on Merchants and Affiliates

Unsurprisingly, this ban has sparked mixed reactions among stakeholders. TikTok Indonesia expressed its commitment to adhering to the new regulations while highlighting concerns for the millions of local sellers and creator affiliates who rely on TikTok Shop for their livelihoods. The platform reportedly said that it has received complaints from local sellers and has sought clarification from authorities regarding the ban’s implementation.

Proponents of the TikTok Shop ban argue that it levels the playing field for traditional merchants and curtails the onslaught of online businesses that undercut prices. Market Promotion Manager Herry Supriatna from Tanah Abang Market welcomed the ban, foreseeing healthier price competition and the potential for increased turnover for traditional traders.

Similarly, textile seller Iyal Suryadi and seller Mr. Raden from Tanah Abang Market have welcomed the move, emphasizing the adverse impact of cheap online prices on their businesses. They propose restrictions on the sale of items through social media rather than an outright ban to accommodate those who have adopted TikTok Shop as a selling channel.

Conversely, some argue that TikTok Shop has been a lifeline for businesses, especially during the challenges posed by the COVID-19 pandemic. Sellers like Fahmi Ridho believe that online platforms offer a way for stores to recover and adapt in a changing landscape.

Andre Oktavianus, a children’s clothing business owner, credits TikTok Shop for a dramatic increase in income and nationwide reach. He highlights how the platform’s social media features enable improved product quality and consumer engagement.

Content creator Wenny Wijaya echoes this sentiment, stating that TikTok Shop has provided her with an opportunity to increase her income, transcending her role as a housewife.

Public Dilemma on the TikTok Shop Ban

During a recent interview with Raymond Chin at tvOneNews, a business consultant, several critical points regarding the state of TikTok Shop and its impact on the Indonesian market were discussed. Chin highlighted the remarkable strength of China’s manufacturing capabilities and supply chains, which have allowed products imported from China to flood the Indonesian market at exceptionally low prices. This phenomenon has raised concerns of predatory pricing, as local businesses in Indonesia struggle to compete with the cost-effective manufacturing power of China.

Despite TikTok Shop achieving a Gross Merchandise Value (GMV) of 2.5 billion dollars last year, it still lags far behind other e-commerce giants with GMVs of around 50 billion dollars. However, Chin predicts a significant upswing in TikTok Shop’s performance, potentially growing four to five times its current value in the coming year.

The dilemma lies in balancing the desire for consumers to access affordable and high-quality products with the need to create a fair competitive landscape for local Small and Medium-sized Enterprises (SMEs). Chin emphasized the pivotal role that SMEs play as the backbone of the Indonesian economy and suggested that policies and regulations should be put in place to support their growth and competitiveness.

On a more positive note, Chin acknowledged the positive impacts of TikTok Shop, which has emerged as a new marketing platform. This development has led to the rise of content creators and local sellers, with some indigenous brands achieving remarkable success, with up to 80-90% of their sales coming from TikTok.

In conclusion, Chin believes that social commerce, exemplified by TikTok Shop, represents an innovative frontier in the market. Rather than advocating for its closure, he suggests that the platform should be subject to proper regulation to ensure fair competition and equal opportunities for all players in the market.

In conclusion

The ban on e-commerce transactions through social media platforms, particularly affecting TikTok Shop, represents a significant regulatory shift in Indonesia. As the first Southeast Asian country to implement such a ban, Indonesia’s decision has sparked debates and discussions among stakeholders. While the ban aims to protect traditional businesses and curb predatory pricing, it also disrupts the livelihoods of millions of sellers and creator affiliates who rely on TikTok Shop.

The long-term impact of this ban remains uncertain. Some argue that it will drive businesses back to established e-commerce platforms like Shopee, Lazada, and Tokopedia, which offer more trusted options for online purchases. Meanwhile, others contend that the ban may stifle innovation and economic growth by limiting opportunities for small entrepreneurs and content creators.

In this ever-evolving landscape, Indonesia’s approach to regulating social commerce will continue to shape the future of e-commerce in the country and serve as a case study for other nations grappling with similar challenges.

How Orderfaz can help enable Social Commerce on TikTok

As TikTok continues to evolve as a platform for social commerce, with features like FYP, Live Stream, and TikTok Ads, Orderfaz emerges as a compelling solution for Tiktok Shop Merchants. Our platform offers a range of features designed to empower users and enhance their success in the realm of social commerce:

Checkout Link; Every product listed by our users is equipped with a unique checkout link. This checkout link can be seamlessly integrated into livestreams or advertisements, enabling customers to complete their purchases with a single click. This technology streamlines the shopping experience, as buyers only need to fill out their information the first time they use an Orderfaz link.
WhatsApp Keyboard; For sellers who prefer to finalize transactions through WhatsApp, our platform provides a smart keyboard compatible with both Android and iOS devices. This keyboard simplifies the customer service process, offering features such as AutoText, Send Checkout Link, Send Invoice, Send Shipping Rates, and Order List.
Landing Page Builder; To captivate potential buyers and provide them with comprehensive information about products, Orderfaz offers a versatile landing page builder. Sellers can create customized landing pages to showcase their products, explain their unique features, usage instructions, and the positive impact their products can have on customers.
Storefront; Our Storefront feature empowers users to establish their own online shops effortlessly, without the need for coding skills. Sellers can share their storefront links on their social media profiles, allowing potential customers to explore their offerings. Additionally, these links can be conveniently shared via messaging apps like WhatsApp, serving as a convenient “Catalog” for potential buyers.

With these powerful features, Orderfaz is poised to transform the social commerce landscape on TikTok, enabling sellers to provide a seamless shopping experience, streamline customer interactions, and effectively showcase their products to a wider audience. Embrace Orderfaz to thrive in the dynamic world of social commerce on TikTok.

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Disclosure: This writing was entirely composed by Reynaldi Gandawidjaja with minor formatting edits. The content does not necessarily reflect the views of the DailySocial.id editorial team.

Siapa Mau Masuk Cleantech?

October 1, 2023Opinioncleantech, opiniWiku

Berbicara tentang ekosistem startup cleantech, bisa dibilang ini bukan ekosistem yang baru. Jika merujuk beberapa artikel yang menjelaskan pertama kali istilah ini dimunculkan, setidaknya sudah 2002 tahun (Neal Dikeman). Tetapi, dengam waktu yang selama ini, apakah ekosistemnya se-vibrant segmen startup lain?

Istilah cleantech dan climate tech atau secara sederhana bisa dibedakan dalam cakupan startup yang membuat produk atau menyediakan solusi hijau dan bersih (green and clean) termasuk di dalamnya meningkatkan performa, produktivitas dan atau efisiensi dari produksi sambil mengurangi implikasi negatif atas lingkungan. Sedangkan climate tech adalah solusi berbasis teknologi yang tujuan utamanya adalah perubahan iklim yang adalah mengurangi dampak dan pendorong gas rumah kaca secara global.

Kondisi ekosistem cleantech Indonesia

Data yang diungkapkan oleh New Energy Nexus Indonesia dari laporannya, seperti yang dituliskan oleh DailySocial. Menyebutkan beberapa kondisi di ekosistem cleantech.

Saat dirilis, laporan tersebut menyebutkan hanya ada 300 startup cleantech. Hanya 50 yang disurvei dan 2 diantaranya tutup. Yang menarik. dalam laporan tersebut, 90% lebih memiliki runway (dana) yang tidak ideal untuk startup, yaitu sebagian besar di bawah 1 tahun. Temuan menarik lainnya adalah sebagian besar masih dalam tahap ideation/prototyping atau testing ke pengguna.

Dari laporan tersebut juga bisa dilihat, dari para VC yang sangat aktif memberikan pendaan untuk startup (misalnya adalah EV), hanya berinvestasi pada 1 startup saja saat laporan tesebut diliris.

Salah dua kendala yang diungkapkan pada laporan tersebut menyebutkan bahwa kendala pendanaan jadi faktor utama. Ada pula kendala jumlah yang kurang banyak dari founder yang cakap dalam segmen ini, serta kerangka regulasi jadi faktor juga di ekosistem cleantech.

Tren sustainability

Di sisi lain, saya juga ingin menyoroti tentang tren yang ada akhir-akhir ini terutama di Indonesia. Jargon sustainability makin santer terdengar dalam beberapa tahun ke belakang di ekosistem startup. Salah dua faktornya bisa jadi karena beberapa startup yanng mulai merilis sustainability report, serta VC yang aktif di Indonesia juga merilis topik report yang sama yaitu sustainability report. Atau ada juga yang merilis ‘saudaranya’ yaitu impact report.

Tentang topik sustainability dan topik hijau juga makin santer jadi bahan topik beberapa media di Indonesia – termasuk media nasional – yang mulai punya kanal atau vertikal khusus sendiri. Tidak terkecuali juga DailySocial yang kini punya Solum.id.

Semakin munculnya topik ini juga bisa karena target yang dipasang oleh pemerintah Indonesia: Net Zero Emission pada 2060 sedangkan transisi EBT atau energi terbarukan seacra nasional 23% di 2025 baru tercapai 12.3%.

Tidak hanya itu, perusahaan-perusahaan multinasional juga sudah mulai cukup ketat untuk menerapkan beragam persyaratan ‘hijau” pada para mitra. Ada pula yang sudah tidak malu-malu lagi mengungkapkan target hijau mereka. Sebut saja Apple, perusahaan paling bernilaui di dunia (Juli 2023 data dari Katadata), yang memberikan porsi cukup besar untuk program hijau mereka.

Mengapa startup cleantech tidak menjamur?

Meski segmen yang berhubungan dengan iklim lebih erat dengan climate tech, tetapi secara garis besar tren penggunaan teknologi untuk solusi ramah lingkungan semakin dibutuhkan, karena bukan hanya tren ekosistem pendanan startup saja, bumi kita memang sedang membutuhkan solusi-solusi berbasis teknologi untuk menjaga agak tetap layak huni.

Lagi pula, ada irisan tipe startup dari cleantech dan climate tech. Masih berdasarkan ulasan Clean Energy Ventures, setidaknya ada Clean Energy, Suuply Chain. Built Environment dan Trasportasion, yang bisa berupa solusi hijau dan bersih tetapi di sisi lain juga bisa berdampak pada iklim atau pengurangan emisi GRK.

Jadi, seharusnya cleantech juga bisa berperan, dus, jumlahnya bisa semakin bertunbuh dan berkembang karena ada permasalahan yang butuh solusi, dan minat VC di sini pun (seharusnya) meningkat.

Apakah minat VC belum bisa beralih dari fintech, SAAS, F&B , transportsasi, agriteh atau bahkan entertainment menuju ke startup di segmen cleantech karena memang tidak ada startup-nya atau adakah alasan lain?

Apakah karena berinvestasi di startup cleantech itu ‘terlalu berat’ dan butuh waktu dan daya tahan (baca: modal) yang tidak sedikit, sehingga ketertarikan VC yang masih malu-malu kucing.

Atau pengaruh lain, seperti misalnya bayang-bayang resesi ekonomi dan behaviour consumer era post covid yang masih membingungkan, yang memberikan pengaruh atas masih rendahnya minat investasi masuk ke startup cleantech?

Atau dibutuhkan perubahan paradigma (tesis) dari para VC agar ekosistem dari iklim pendanaan yang memungkinkan tumbuh suburnya startup cleantech. Karena tesis ‘masuk di round awal keluar di round berikutny’a, menurut saya bukanlah tesis investasi yang cocok di segmen atau ekosistem cleantech. Karena sebagian besar butuh dana tidak sedikit untuk tumbuh atau untuk pengembangan R&D.

Di sisi lain, solusi low tech di bidang hijau – dibeberapa kondisi – malah jadi lebih menarik dan mudah mendapatkan dana, misal program dari NGO atau dana CSR. Atau bahkan dana berupa program dari perusahaan yang membutuhkan target untuk dimasukkan di laporan sustainability mereka.

Saya jadi ingat tulisan saya yang sedikit banyak bisa jadi penutup tulisan ini. Sekaligus jadi saran sederhana untuk membuka diskusi tentang perkembangan ekosistem cleantech ke depannya.

Saran yang bisa saya utarakan adalah serupa dengan saran saya ke ekosistem startup tahun 2011, yang entah kenapa, meski sudah lebih dari 10 tahun, bagi saya masih selalu dan terus relevan: investor (perorangan, VC atau CVC) – akselerator – inkubator – dan juga pemerintah, termasuk juga bank lewat Taksnonomi hijau, harus bantu inovasi yang dikembangkan oleh para startup cleantech agar ekosistemnya bisa tumbuh dan berkembang.

Shinta Nurfauzia on Her Entrepreneurial Journey: Strong Work Ethic Take People Places

May 9, 2023English, Interviewentrepreneurship, healthy consumer space, Lemonilo, mastermind-en, Shinta Nurfauzia, woman entrepreneurKristin Siagian

This article is a part of DailySocial’s Mastermind Series, featuring innovators and leaders in Indonesia’s tech industry sharing their stories and point of view.

Healthy consumer space is getting more crowded. According to Deloitte Consumer Insights, people have demonstrated an overall shift towards greater health consciousness. In the food category, healthiness and nutritional value come in as the biggest three considerations after price and taste. Lemonilo is one of the pioneers in this area.

Shinta Nurfauzia is one of Lemonilo’s co-founders. She believes that Indonesia has the opportunity and quality to become a better country. She completed her formal education in business law from the University of Indonesia and Harvard Law School. After quite some time working in the legal field, she ended up more excited with her side job as an entrepreneur.

During her education years as well as her working days, Shinta is a very passionate person. She started her first business early at 14 with The Pancake Co. and comeBAGtome. Her last job before Lemonilo was consulting for the Indonesian government while being a founder of the fashion brand Hood. When she was a lawyer, she was named the most promising Indonesian female lawyer back in 2012.

All of these achievements are not just come knocking at her door. She worked very hard for that. She sets a high standard, a strong work ethic, and a full dedication to everything that she worked for. She’s an inspiration to her surroundings, especially for women who still think that they are not good enough.

DailySocial had an opportunity to dig deeper into her journey as an entrepreneur and a woman in tech. Here’s the excerpt of our conversation.

Who is Shinta Nurfauzia before Lemonilo?

When Lemonilo was founded in 2016, I was a student, a lawyer, and a consultant. However, I’ve always had this entrepreneurship mindset. Philosophically speaking, I have a dream for Indonesia to become a better country. At that time, I was thinking that health is one way to achieve that goal. Why? Because in order to become a productive country, one should have a healthy population.

Therefore, I want to create something with this angle. Before Lemonilo, there was Konsula, a healthtech startup with a mission to improve health access for the Indonesian people. I learned a lot from co-founding Konsula before finally deciding to take another approach to contribute to the development of healthy consumer space in this country with Lemonilo.

What really inspires you to create Lemonilo?

Lemonilo started out as an e-commerce platform. We look for healthy food products, set the health standard, and market the product. At that time, healthy food products are not as mainstream as today. In the process, we found out that Indonesian people are very addicted to instant noodles yet also complain about the unhealthy side of it.

Based on this problem statement, we’d come to a solution that Indonesian people need healthy instant noodles intake. Despite all of the things that we are scared of a pack of instant noodles, we still need it. There is a giant need gap there. That is when we started to produce our own healthy instant noodles. Furthermore, we expand to several products, such as snacks and spices.

In terms of creating a product, there are a few steps. First, the ideation. As we are a data-driven company, all of our ideas come from data first as we’ve seen what the market needs. Then, we conduct some research to hear what people really say about the problem in order to create a solution. We have our internal product innovation team, involving seasoned technologists and scientists to do the whole production cycle. To date, we have around 300 employees.

You have an academic background in legal yet you manage to build a startup for healthy products, how do you see these two things related?

The basic output of being a student is having a work ethic and dedication. As a lawyer, these two things are non-negotiable. Aside from that, there is legal thinking. During my days working in the legal field, legal people have the capacity and comprehensive understanding of risk management. And it is essential for business.

Basically, they are very related in several layers. In terms of stress level, as a person working in the legal field or being an entrepreneur, I have my share of sleepless nights. We cannot escape our responsibility and it is overwhelming sometimes. Also, when it comes to legal, everything is a red alert. However, I encourage myself to put the maximum effort into both roles.

During your journey with Lemonilo, what was the biggest lesson learned from running a business in the tech industry?

For me, the biggest challenge as a founder is finding the right product market fit. You need to know your consumer better and do it right in order to pass this stage. Many startups are giving away free stuff and offering big sales just to attract consumers. However, when the price back to normal, not everyone would stay.

Also, many people saw these startups with revenues and a series of funding thinking that they are already found the product market fit. The fact is nothing can guarantee product market fit, it is a continuous journey. One of the elements of product market fit is the product is well-accepted and paid accordingly to the effort and original price. This is one of the biggest lessons I’ve learned from Konsula.

Lemonilo caters to quite a niche market. What makes you believe Lemonilo can be a sustainable business?

When you say ‘niche’, what kind of standard that you use? Is it niche to create a product that is also sold by a number of giant players? In 2016 when there are not many healthy products discovered, Lemonilo offers a niche product. Today, the fact that there are at least 4 big companies producing healthy instant noodles and claiming a similar concept with Lemonilo proves that we are doing something right.

In terms of growth, we are right on track. As the number one healthy player in Indonesia, according to Nielsen, Lemonilo has two responsibilities. First, to strengthen its position amongst massive competitors entering the healthy consumer space. Second, expanding the healthy consumer space itself.

I personally love competition. In fact, the more player the bigger the scene. Lemonilo also invites other brands to involve in this initiative. Because this is a group effort to create a healthier FMCG space, Lemonilo cannot do this alone.

How do you manage to keep the company stay in line with the mission?

In Lemonilo we have a culture called SBD. As a company, we have to serve others. Aside from generating income, we are here to create a better life for many people. In order to do what we aim to do, there is no blueprint. Therefore, we need to understand the FMCG market thoroughly.

We need to learn but at the same time, we need to unlearn to find the Lemonilo way. Therefore, we need to be free in Lemonilo way. Finally, we need to do what is right. Despite all the competition and the uncertainty, we need to keep our integrity tight to do what is right.

You are one of only a few well-known women leaders in this country. How do you see the tech industry treating women as a worker or women as a leader?

For the tech industry and any industry in general, WE CAN DO BETTER. For example, how many women founders have received funding from VC? It’s still a very small number. Lots of people still think that women are not as capable as men and that it is hard to trust women with money, while research found that women are likely better with responsibility. So, why are we scared to give women the chance?

A global research also showed that gender equality can boost economic growth and stability. I hereby speaking not only in the context of women in tech, but also in a general way. A small thing mentioned by Sheryl Sandberg in her book Lean In about why is it necessary for pregnant women to have special parking spots. Biologically, women and men are different, it will be unfair to justify only one standard.

In fact, lifting women does not necessarily mean stepping on men. I think women’s position in the tech industry is still not equal. Companies still have to look for a way to balance this. As we see it based on the economic value, there are monetary and opportunity losses in the imbalance.

As a woman entrepreneur, what would you say to the other woman out there trying to make it into the entrepreneur world?

First, you are not alone. Believe in yourself that as a woman–despite your environment–you can achieve great things. Second, in order to achieve your dream, make sure to find your tribe. In fact, who can understand women’s problems better than fellow women?

I’d like to share Najwa Shihab’s example of having a tribe. It is simply by creating a small support group of women where the only purpose is to flatter each other. It’s not at all fake, but in a world where things are difficult, it’s nice to have your support group.

George Hendrata Turns Tiket.com Business Around with Strong Company Culture

February 13, 2023English, Interviewdjarum group, George Hendrata, mastermind-en, tiket.com, travelKristin Siagian

This article is a part of DailySocial’s Mastermind Series, featuring innovators and leaders in Indonesia’s tech industry sharing their stories and point of view.

The tourism sector is one of the worst affected by the impacts of COVID-19, blocking the economies, livelihoods, public services, and opportunities on all continents. As Indonesia’s President Joko Widodo announced an end to the public activity restrictions, this will significantly affect the travel industry, including OTAs regaining their dominant position within travel distribution.

George Hendrata has an educational background in tech from Columbia University and MBA from Harvard Business School. He has working experience in several multinational companies, including Motorola & Boston Consulting Group, and became the Director of Djarum’s Business Diversification before taking the opportunity with tiket.com. With his persistent character and creative mind, George turns tiket.com around and makes it blossom.

Nobody expects that the travel sector would be a bridge to disseminate something horrible such as coronavirus disease. As much as we cannot believe it, Covid-19 has been staying in this country for over three years now. However, due to hard work across sectors, we can at least say that the pandemic has been handled. It is now the time for the travel industry to rise again.

During six years with George, the t-fam (tiket.com employees) has grown significantly and managed to survive this pandemic without doing any layoffs to the core team. At the end of last year, tiket.com along with Blibli and Ranch Market announced a unified omnichannel ecosystem called blibli-tiket. The initial public offering (IPO) is said to be the 5th largest listing ever on the IDX, and the 2nd largest last year.

Alongside his current position as the CEO of tiket.com, George also likes to mentor and invest in companies. He said it gives him an opportunity to share ideas, learn new things, help entrepreneurs, and contribute to the economy.

DailySocial had the opportunity to have an exclusive interview with George Hendrata and discuss his career journey and leadership. Below is the complete version of his story.

I’m not sure to say that we are past the pandemic. However, the pandemic has transformed many lives and significantly affect some industries, including the OTA business. I want to know how are things going on in the OTA sector nowadays, especially tiket.com?

At that time (the first case in China), we still think that we were immune to this. When it finally happened, we were expecting the revenue would get to zero. Many customers asked for a refund and reschedule. Obviously, we have to focus on our people, that is our consumers, our partners, and our t-fam. We reinforced our Customer Service team, seconded by other teams in order to take care of all the issues. Because of this focus on people, we gained market share even during the pandemic.

Our travel partners, such as airlines, tour operators, and accommodations are deeply affected. Their businesses went down significantly. Not long after, they had to lay off. Even though business was slow, we kept trying to promote our partners. Since our customers were not able to explore international destinations, they started to explore their own backyards. Many visited Labuan Bajo or Raja Ampat for the first time. Fortunately, during the pandemic, hotel room occupancy was higher than expected, due to people doing staycation and staying during quarantine.

During the crisis, we have to creatively look for opportunities. Due to covid, our customers prefer to travel with their families, stay outdoors, and avoid common areas. Hence, we launched alternative accommodation (villas) category called tiketHomes.

Currently, tiket.com has 3.6 million accommodation listings in total, including 2.2 million tiketHomes listings. The pandemic also hits hard on the economy. People may have reduced buying power when it comes to travel. Hence we try to solve this issue by offering Tiket Paylater. Now, our customers can enjoy purchasing travel products and installments.

PPKM restrictions have shut down offline attractions. We experimented with offering online attractions. To our surprise, it turned out that people not only like to scream when they go to theme parks but also in their own homes while watching online horror live shows; and customers are willing to pay for this. 2022 is getting off to a great start with all the offline concerts, events & attractions coming back. To date, the offline and online combination has created almost 8 times the volume compared to before the pandemic.

To date, the travel & lifestyle sector recovery has been amazing. There is no longer PPKM in the 2nd quarter of 2022. By September 2022, based on national data, the flight industry has recovered around 65% by seats; domestic recovery is about 70% and international recovery is about 55%In accommodations, the occupancy rate has reached the pre-pandemic level. Travel in the 4th quarter of 2022 has gone very strong. This makes 2022 the best year ever at tiket.com, in terms of bookings.

Originally, Tiket.com was founded in 2011. An interesting fact, you joined the OTA later in 2017. Who are you before the CEO of tiket.com?

I graduated from Columbia University and majored in electrical engineering in VLSI (Very Large Scale Integrated circuit). I used to work for a mobile phone company, Motorola, before I finished my MBA from Harvard Business School and joined Boston Consulting Group. Djarum Group wanted to diversify the business, and that attracted me to join the business development/diversification team as Business Development Director.

We have been blessed to run successful businesses in FMCG, consumer electronics, financial services, telecom infrastructure, natural resources, and tech. By being exposed to these businesses, I realized that my strength is in either starting up or turning around. With tiket.com, we saw an opportunity to turn around the business, and I took it.

I led the due diligence for tiket.com and fell in love with the founders. As we interviewed our travel partners, it was clear that there is a space to compete with the current market leaders. They would like to have a better relationship with online travel agents. On the other side, customers also need options. Hence I believe that we should go ahead.

How was your early days with tiket.com? How did you take the succession?

One of the issues with companies that have been stagnating is that typically the positive energy & spirit is no longer there. Typically the star employees have left as well. The first thing I did was to speak to the employees. We were around 250 people with about 60 people in the tech team.

I interviewed them one by one, asking simple fundamental questions. After the assessment, I asked, “Do you believe that we can be number one?”. The ones who said yes, became part of tiket 2.0 The ones who said no left, as they didn’t find the place right for them. We grew our tech from about 60 people to about 500 people in 5 years. tiket.com currently has around 1200 employees.

Today’s tech companies are fraught with layoff news. However, (so far) tiket.com has managed to survive the pandemic without any. What kind of insights can you share about this current issue?

We call our employees the t-fam. Yes, we did not do any layoffs. We focus on strengthening our core team and downsizing only the outsourced workers.

However, it all comes down to the hiring process. We are being prudent in our hiring, by being careful and selective. We are doing selective hiring to complete our manpower planning, instead of massive hiring. Therefore, in the downturn, we did not have to downsize as much. To build an effective team, company values & culture is very important. This depends on what the company is all about.

Also, it depends on what the leaders and management are like. Company culture can’t differ much from the leaders’ culture. If the leaders do not embody the intended company culture, the culture won’t stick. tiket.com is a startup that disrupts the travel space. It needs people who are “hungry” to meet the unmet needs. To find areas where you can disrupt, and where you can provide value for customers.

Also, we need to be “agile” as customers’ demands will be changing over time like in factories, where arguably the most important asset is the machine, and the most important asset for start-ups is its people. Therefore, we need to be “people-oriented” Also, a dream is only a dream if doesn’t get implemented. In order to implement well, we need to have a “performance orientation” to monitor whether products are being launched well and timely.

Lastly, we need people to join us not only with their arms and legs but also with their hearts and minds. For that, you have to be a unique “you”, so you can be creative in your approach we put the initials together, and it will form the word “HAPPY”, that is the culture of tiket.com. This is what glues us together. When people are engaged, they are more passionate in delivering apps that people love. That is our vision.

In October 2022, Blibli, tiket.com, and Ranch Market announced a merger into BlibliTiket. What is the story behind this merger, and what changes after?

The beauty of a merger with Blibli and Ranch Market is that we don’t need to overextend ourselves to reach a bigger market. We have seen some companies trying to increase the total addressable market by going into areas that are not natural extensions. We are not going that way.

People typically travel between 3-4X per year, maybe buy through e-commerce every couple of weeks, and buy groceries every couple of days. This merger offers a very unique combination of travel, e-commerce, and grocery, naturally allowing more frequent, and deeper engagement with our combined customers.

The three platforms have proven profitable business models worldwide. As we offer each other services and provide single sign-on, it will naturally extend the overlap between three different businesses and increase the synergy of the whole ecosystem. With the synergy, you’ll be able to acquire more customers into each other’s platform and create a bigger, better ecosystem.

Based on the study by Frost & Sullivan and Euromonitor, eCommerce in Indonesia is projected to reach US$150 billion by 2025. The travel & lifestyle market is projected to be US$ 41 billion. Most OTAs are also profitable and publicly listed. International Air Transport Association (IATA) said Indonesia will be the 4th largest travel market in the world by 2030.

Grocery, which is served by Ranch Market is projected to be USD 245 billion by 2025. The combined total addressable market is USD 436 billion by 2025. This is about one-third of Indonesia’s current GDP. It is HUGE. We want to create an ecosystem of choice through omnichannel. Indonesia will still have a huge offline market, even though the online market grows rapidly. Hence omnichannel is the right strategy for Indonesia.

Integrating two companies is hard enough, let alone three. How would you overcome the challenges?

Any merger is never easy. The important thing is that the people involved understand that unity brings bigger synergy. Each of the businesses has a different natural frequency, and the current customer overlap is small. By bringing each platform’s customers into a single ecosystem, we have a better picture of the consumer journey. Our recommendation will become sharper, and consumers will become more sticky and loyal.

Corporate action allows us to improve our corporate structure to grow better. Being a public company also means better corporate governance. We can attract more talents as we can provide ESOP During this volatile equity market condition, we have successfully executed the 2nd largest tech IPO in Asia Pacific in 2022, and the 5th largest of all time in IDX. It gives us a lot of confidence to move forward.

Our focus is on the fundamentals of the business. The support from investors during the IPO provides the confidence that this is a good company to back and that the company is going to be there for the long run. We believe this successful IPO also shores up confidence in Indonesia’s tech startups.

During your 6-year journey with Tiket.com, have you ever thought of starting something new or shifting industry

I personally love people, I love to connect. I like to share ideas and learn new things. Also, I’m obsessed with building GREAT products to meet unmet needs. When I was developing mobile phones, I used to bring 4 mobiles to take the same pictures and compare the quality of the mobile cameras. I love the challenge to start a greenfield operation or turn a company around. With deep curiosity, there are lots of things that interest me.

Personally, I like mentoring and investing in companies. It gives me an opportunity to share ideas, learn new things, support entrepreneurs and contribute to the economy. In terms of investment, in my opinion, if you have experience operating a company, your investment acumen sharpens.

What is your projection for the OTA business in 2023 and forward?

First, the OTA sector is consumer tech, meaning that the size of the business is driven by the number of consumers. With a large population in Indonesia (about 270 million), and South East Asia (about 600 million), this will continue to grow. Second, the travel sector usually grows at 2-3 times the GDP growth. Since online travel penetration in Indonesia is still increasing, online travel usually grows at about 2X the total travel growth. The year 2022 growth is much faster than the typical year, due to revenge travel post covid.

Indonesia’s internet economy will likely reach $330 billion in value by 2030, almost double the current Southeast Asia’s digital economy value of $170 billion, according to a recent report by Google, Temasek, and Bain released in 2021.

Third, Indonesia’s GDP per capita is currently at USD 4000 per capita. Travel inflection point typically happens at USD 7000 per capita level, as we have seen in other markets. As Indonesia crosses this GDP per capita level, travel growth (and OTA growth) is expected to accelerate even more.

I am optimistic that 2023 will be a better year than 2022 in terms of travel. However, we also need to be prepared should things don’t turn out as rosy, by controlling our expenses well. Personally, I think when we finally overcome the pandemic, we’ve grown even stronger. It’s just like the saying “What doesn’t kill you makes you stronger”.

KLAR Is Reportedly Securing Over 91 Billion Rupiah Pre Series A Funding

August 23, 2022EnglishAC Ventures, east ventures, Ellen Pranata, funding, GK Plug and Play, HEALTHTECH, Kenangan Fund, KLAR, Venturra DIscoveryRandi Eka

Dental care startup KLAR is reported to have raised pre-series A funding. Previous investors, including AC Ventures and Kenangan Fund are participated in this round. There are also new investors such as East Ventures, Venturra Discovery, and GK-Plug and Play.

One of the representatives involved in this round has confirmed the funding to DailySocial. Meanwhile, according to data submitted to the regulator, KLAR has received up to $6.12 million or equivalent to Rp91 billion Rupiah.

Previously, KLAR had secured seed funding from AC Ventures and Kenangan Fund in June 2021. The fresh fund was used for several spots, from market research, team strengthening, increasing brand awareness, and adding new product lines.

Product and services

KLAR was founded in September 2020 by Ellen Pranata, Adelia Susanto, and David Sugiharta. All three have mutually sustainable backgrounds in this business.

Ellen was previously the director of a dental equipment importing company. Meanwhile, Adelia is an orthodontist with loads of experience in treating clear aligners. David himself is a dentist who specializes in prosthetics, aesthetics, and full mouth rehabilitations.

KLAR currently offers several products and services. The company offers two main products, Aligner and Retainer for dental care – produced independently. While the complementary services include an online consultation feature.

With the B2B2C business model, the company aims to empower doctors and clinic partners to become part of their business ecosystem. Based on its official website, there are currently almost 300 partner dental clinics spread across various cities in Indonesia.

Through the “KLAR Smile” application, dentists and patients can interact and monitor treatment status remotely. This innovation is considered to be a value proposition that distinguishes KLAR from other similar players.

According to data, the market potential for aligners in Indonesia is estimated to reach $3 billion (Rp43 trillion). With per capita GDP growth and increasing interest in personal care and aesthetics, KLAR believes the demand for aligners in Indonesia will continue to increase.

In Indonesia, apart from KLAR, there is RATA which also targeting the same segment. RATA alone has been supported by a number of investors, one of which is Alpha JWC Ventures.

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Original article is in Indonesian, translated by Kristin Siagian

From MCI to BNI Ventures, Eddi Danusaputro’s Continuous Journey to Support the State-Owned’s CVC Scheme

August 4, 2022English, InterviewAmvesindo, BNI Ventures, CVC, eddi danusaputro, Mandiri Capital, mastermind-en, mci, venture capitalKristin Siagian

This article is a part of DailySocial’s Mastermind Series, featuring innovators and leaders in Indonesia’s tech industry sharing their stories and point of view.

Indonesia’s investment ecosystem is said to have a tough time, as affected by the “winter season” in the US, where some sources flow the investment money in this country. However, despite the unfortunate facts, we can learn many things from this situation. Eddi Danusaputro agreed on this as a necessary evil, a maturing process for Indonesian startups, which for a long time has had its seasons in the sun.

Recently departed from MCI (Mandiri Capital Indonesia), Eddi Danusaputro has put all in his power to build and nurture the State-Owned Enterprise’s CVC from day one. With limited resources and a small room for experiments, Eddi has led this company to generate 20 investment portfolios. The most recent investment was on Jul 11, 2022, when AgriAku raised $35M. Aside from that, the CVC has had three exits, including the most notable ones, Moka and Jurnal.id.

After dedicating almost 6,5 years of his life to MCI, Eddi is ready to embrace a new journey with another state-owned VC, Bank Negara Indonesia (BNI). Although he is not yet available to discuss much of the new entity’s further plan, he assured to make a good deal of all his previous experiences in the new venture. In addition, he will be fully in charge of the Merah Putih Fund, a fund initiated by the SOE ministry and co-managed by 5 CVCs.

Not long ago, he was appointed as the Chairman of Amvesindo, a venture capital association for Indonesian startups. Aside from the VC life, Eddi is highly passionate about basketball. To date, he’s been involved as the Chairman of Indonesia’s local basketball club, Amartha Hangtuah.

Above are some facts about Eddi Danusaputro. DailySocial has had a chance to hear more about his journey to becoming one of the most successful venture capitalists in the country. Let’s listen to it through the excerpt below.

Let’s start with the early days of your career. How was the journey of becoming a venture capitalist with your economic background?

We usually think we choose our journey, but sometimes it’s the journey that finds us. I graduated in the mid-’90s, and the digital industry was not developed back then. Some options include a state-owned enterprise (SOE), government-related, or Multinational. I chose the last one.

I began in the sales department for FMCG products, P&G. I admit that this experience has sharpened my marketing skills. Whatever you do, whether in sales, marketing, or engineering, at the end of the day, you have to be able to sell. People sell every part of themselves, their ideas, their skills, and their products. Communication sets of skills are essential.

Furthermore, I got a scholarship to Duke University in the US, catching my enthusiasm for the finance industry. I started in New York City with Morgan Stanley, then relocated to Singapore. I lived there for 12 years and finally returned to my home country to help build MCI.

You have experienced different cultures by studying and working in the US, then transferred to Singapore and living there for 12 years. Is there any significant impact on your journey?

Studying abroad has broadened my insight. With students and lecturers from different countries also brought different perspectives. Several trends are set outside the home country. For example, the “dot com” trend started in the US, and I am fortunate to experience it live. It goes along with investment terms, private funds, and so on that rise from the west. People with the privilege to study or work abroad can experience the trend and move back to leverage the movement in their home country.

In Singapore, people tend to be disciplined and punctual. Also, they are usually more individualist in terms of working culture. Colleagues do not necessarily become friends. They’re just in it for the job. Meanwhile, aside from the traffic that challenges time management in Indonesia, we are most likely to be social. Friends are pretty close and easily share contact. In other countries, privacy is precious.

During the journey, you’ve been occupying several positions. Which one do you cherish most?

I have been working in the capital market, where we need to keep an eye 24/7 to monitor the selling and buyout in the exchange. This situation has affected my working hours and communication in general, not mentioning about the time differences and the high volatility. It is pretty different from the dynamics of the startup industry. However, whichever, I should be able to enjoy the process.

How about the challenge after you’ve entered the VC industry?

In the startup industry, we’re investing in people, the founders. We need to build a relationship to know the person, which requires some time. That is one thing. Then, the pandemic came rattling, and some did not make it.

Recently, the startup industry is said to have a winter season. Some of these startups are yet to experience a correction, either topline or valuation. This condition is something they should learn from. Is it going to affect the runway? Should they be worried? What will the investors do? This way, we can finally see the founder’s character and which one will be resilient and survive during the hard times.

You’ve recently departed from Mandiri Capital Indonesia after 6,5 years of building and nurturing the CVC. What can you share about the experience, and where do you plan the next journey?

I was there from day one of MCI. I helped build the system, workflow, and SOP and shaped the company culture. We are not a giant company with massive resources. Therefore, we need to work efficiently. I need most of the team to be generalists and intrigued to know the work of the other groups. Work rotation is necessary. Everyone should learn everything before becoming a specialist.

As a CVC, we also need to take a risk, not to be reckless but calculated risks. It is fair to make mistakes as long as the process has been proper. However, not all decisions turn out to be what we planned. The culture is to know how to make a decision and be responsible.

It has been two terms, and I have officially departed from MCI. However, I’m still being an advisor during the transition to my new position. MCI is a long trip. My next journey is to build a new CVC for Bank Negara Indonesia (BNI). It may look similar to the last journey, but I’ve had my experiences and learned my lessons.

You were recently appointed as the Chairman of Amvesindo, a venture capital association for Indonesian startups. Do you think the industry has already in its ideal situation?

On a general note, the association covers not only the VCs but also startups (which are yet to have an independent association). It also becomes a discussion companion for regulators, bridging the concern of the two parties. It is the core and primary function in this industry.

It is yet to be ideal. However, this is a long journey. The important thing is that communication is way better than before. Startups, VCs, and the government have built an excellent start to walk through this journey.

Aside from the current job, do you have other interests to pursue?

I’m also an angel investor for some companies starting from scratch. Also, I’m currently a Chairman of the Amartha Hangtuah basketball club.
I have a mission for Indonesian basketball clubs can be profitable like the global ones, not just rely on the owner’s pockets. I’ve dreamed of them surviving with sponsorships, ticket merchandise, etc. The club should be self-sustainable.

Furthermore, I intend to improve athletes’ welfare in Indonesia. There are numerous stories about former athletes who live below the poverty line. It might be due to a lack of skills outside of sports or the unawareness of saving and investing. Every payday at the club, I help oversee and encourage them always to plan their expenses and set a pie for investment and savings. It’s solely for their future.

Eventually, I want to boost these clubs’ exposure, hoping they can plot for IPO one day. I wish to take my club to the next level and reach these milestones. Thus, I can wed my two passions, startups and basketball.

As a seasoned entrepreneur, is there anything you want to say to the younger generation who just started their journey?

This thing is essential. Whatever age you are, you must be eager to learn something new. Surround yourself with people who are more intelligent than you. If you walk into a meeting and are the smartest person in the room, you’re in the wrong room. Then, you cannot learn anything new. It includes when we’re in the organization, we must dare to hire people with expertise different from you. At a Director’s level, one must know to recruit people who are a thinker, not only executors.

I experienced several career pivots and must be ready to learn something new. Life is a series of continuous learning. Besides my current career path and basketball venture, I’m also a lecturer at Bina Nusantara University (Binus). Once I had a class of corporate students, and I had fun teaching and learning from them. The key is not to easily satisfied and feels like an expert.

Currently, I’m treasuring new technologies. I called it ABCD (Artificial Intelligence, Blockchain, Cloud Computing, and Database). I took a course in data science and machine learning. It’s my thirst to learn something I am yet to master. Lately, I’ve been interested in crypto meanwhile still focusing on sports management.

What’s your projection on the startup investment industry? Which sectors are resilient enough to get through this storm?

This winter season is a necessary evil. It’s a maturing process for Indonesian startups, which has had its seasons in the sun for a long time. Even though they can pass through the pandemic, now, with the downturn, it is a good thing, something to clear our sight.

All kinds of assets, stocks, commodities, everything has a cycle. Correction is inevitable. Then, the spring will come again. There are several schemes with B2B, B2C, B2B2C, and D2C. The one with the “burn money” strategy mainly lies on B2C. However, this is all going to change. Businesses should be able to outsmart this strategy.

My prediction goes with consolidation. There are so many e-commerce players. Are they all going to survive? I don’t think so. The market will eventually narrow, some will die or fall, and there will be few options. I root for consolidation and M&A in this ecosystem. Startups also need to plan for exits, which could be IPO or other mechanisms.

KitaBeli Secures 299 Billion Rupiah Funding, Expanding into New Business and Categories

July 18, 2022EnglishAC Ventures, e-commerce, funding, Glade Brook Capital Partners, goventures, Group Buying, InnoVen Capital, kitabeli, prateek Chaturvedi, Social CommerceMarsya Nabila

An FMCG-specific social commerce startup, KitaBeli, announced a $20 million (worth 299.5 billion Rupiah) funding round led by Glade Brook Capital Partners, an American equity investment firm. KitaBeli’s previous investors, AC Ventures, and Go-Ventures also participated, along with a new investor, Innoven Capital.

KitaBeli is to use the fresh money to continue expanding into second and third-tier cities across the country, while launching new product categories such as beauty, personal care, mother & baby products, and frozen foods.

KitaBeli is a social commerce platform that offers FMCG products and allows users and partners to get discounts and earn money by leveraging their social network. This app allows consumers to enjoy discounted prices through a social and gamified shopping experience.

Unlike most e-commerce applications, KitaBeli runs a direct-to-consumer business model that offers buyers the basic necessities of daily life. KitaBeli combines PinDuoDuo’s ‘group buying’ approach and combines it with a local community approach.

“By being extremely consumer-focused, we have been able to achieve product-market fit and scale very fast in a historically untapped market,” explained Prateek Chaturvedi, co-founder and CEO of KitaBeli, Monday (18/7).

He continued, by leveraging the offline social networks of our Local Community Leaders (Mitras), we have been able to reach thousands of new users who are buying online for the first time in their lives. This has helped us build massive loyalty with our customers and enabled us to deliver better long-term margins than other players.”

“Glade Brook is one of the most experienced growth stage investors we’ve met, and their experience in e-commerce and social commerce across emerging markets globally is unmatched. The experience and insight that Linda Guo, Paul Hudson and their entire team have brought to this space convinced us that they are the right partners on our journey.” he said.

Glade Brook Capital Partners’ Partner, Linda Guo said, “We are excited to partner with KitaBeli to bring better, more affordable ecommerce access to second-tier communities in Indonesia. We believe the next wave of ecommerce growth in Indonesia will be driven by consumer demand outside major cities like Jakarta.”

AC Ventures Founder & Managing Partner Adrian Li added, the company’s commitment to KitaBeli further substantiates our thesis that Indonesia’s next frontier of ecommerce users will come from second- and third-tier cities in Indonesia. KitaBeli has focused on creating a solution that is well-suited for rural consumers. It utilizes social hooks and gamification to push engagement and employs a hyper-local community delivery model.

“KitaBeli’s product-led approach and operational excellence has demonstrated powerful customer engagement, strong top-line growth, and promising take rate expansion. We are enthusiastic about KitaBeli’s future and excited to have been a part of the journey from the very beginning,” Adrian said.

Opportunities in the second and third tier cities

Chaturvedi said that historically, expansion into rural areas has not been widely implemented by other players. Whereas second and third-tier cities in Indonesia currently represent a market of more than $100 billion, with over 200 million consumers and contributions exceeding 50% of the country’s GDP. However, this opportunity is not immune to the following issues.

For example, consumers often experience longer delivery times for online shopping orders. KitaBeli provides solutions by building warehouses in its operational areas, enabling it to make same-day and next-day deliveries straight to the customer.

Furthermore, consumers are often hitched with higher prices due to broken supply chains. This often results in 10%-50% cost higher than consumers living in Jakarta. By sourcing products directly from brands and principals, KitaBeli provides huge savings to consumers.

“Also, consumers in second-and third-tier cities often have trust issues with e-commerce as they don’t familiar with the person they doing business with. In order to solve the trust issues, KitaBeli employs a different strategy from its competitors, focusing on consumers’ offline networks and encouraging them to invite friends and family to use the platform.”

Over the past few months, KitaBeli claims to have grown more than 10 times and this achievement makes the company a leading player in this vertical in Indonesia.

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Download the recent Social Commerce report published by DailySocial.id here. Discussing the trend and business model of Indonesian Social Commerce.

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The Manufacture Hub Startup Imajin Receives Pre Series A Funding from Init-6

July 12, 2022EnglishChendy Jaya, funding, Imajin, Init-6, Manufactur hub, manufacturerCorry Anestia

The manufacturing hub startup Imajin received pre-seed funding from Init-6 with an undisclosed amount. This funding will be used to accelerate digitization in the manufacturing industry through market expansion and new product development.

In a short discussion with DailySocial.id, Imajin‘s Co-founder & CEO, Chendy Jaya said that Init-6 is currently the sole investor for this round. However, the Global Fund is said to participate in this funding.

In Indonesia, Imajin plans to expand to several cities in Java and Batam. In addition, the company is strongly considering an expansion to Japan. After his recent visit to Japan, he implied to gain a positive response from the local companies.

“I think we’ll need representatives in the country, in order [prospective customers] to be onboard at Imajin,” he added.

Imajin is a platform that bridges demand and supply in the manufacturing industry. By positioning itself as a manufacturing hub, Imajin offers three business models, (1) a platform to gather business players in the manufacturing industry, (2) project financing, and (3) a marketplace to supply raw materials.

Throughout the first semester of 2022, he continued, Imajin has recorder an Annual Recurring Revenue (ARR) contract of almost ten times growth compared to two years ago. The company has just started its expansion in East Java, and released an AI-based Quick Note feature to detect 3D files and instantly determine the price range of the goods.

On his LinkedIn page, Init-6’s Venture Partner, Rexi Christopher believes that Imajin will have a significant role to play in revolutionizing the manufacturing industry in Indonesia. Moreover, 20% of Indonesia’s total GDP is projected to come from manufacturing. Its growth is also predicted to be faster due to the adoption of new technologies.

In addition, he believes that Imajin is backed by know-how founders in this sector. “We believe that Imajin can accelerate digitization in manufacturing so as to make its industry in Indonesia more competitive in the global market,” he said.

In fact, Init-6 was founded by Bukalapak’s Co-founders, Achmad Zaky and Nugroho Herucahyono with a focus on investing in early-stage startups. Recently, Init-6 has channeled funding to the “Dibimbing” edtech platform.

Manufacturing digitization

On a separate occasion, Imajin works closely with the Sole Agents of Brand Holders (ATPM) in the automotive and other sectors and cooperates with the Ministry of Industry to accelerate the digitization of manufacturing in the country.

In its efforts to enter the Japanese market, Chendy said that the automotive industry in Indonesia has great potential. Moreover, some high technology for automotive products, such as servo-brakes, gear boxes, and drive-axles, are still imported from Japan. According to a report by the Indonesian Embassy in Tokyo with Mizuho Bank, the import value reached $1 billion.

Meanwhile, the Indonesian government is aggressively encouraging domestic digitalization in order to meet the regulation of the Domestic Content Level (TKDN) of at least 35% and increase to 80% in 2026, especially in electric vehicles.

“We found a classic problem that often occurs in the manufacturing sector, which is finding trusted vendors. We want to digitize the procurement process to production, therefore, the Indonesian market can compete with other countries,” he said.

Currently, Imagin has more than 400 local manufacturing partners and 80 customers including Japanese companies in Indonesia. Imajin strives to provide dozens of customers from leading companies, such as Tom’s Racing, Toyota Motor Corporation, Mitsubishi Motor Corporation, so that they comply with product standards owned in Japan.

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Original article is in Indonesian, translated by Kristin Siagian

Agriaku Secures Series A Funding Worth of 520 Billion Rupiah

July 11, 2022EnglishAgriaku, agritech, Alpha JWC Ventures, BRI Ventures, funding, GO Ventures, Irvan Kolonas, Mandiri Capital Indonesia, mdi growth, Series AMarsya Nabila

The agritech startup, Agriaku, announced a Series A funding round of $35 million (approximately 520 billion Rupiah) led by Alpha JWC Ventures. Previous investors, including MDI Growth (ARISE, Centauri, and MDI) and Go-Ventures participated in this round, along with new investors, BRI Ventures, and Mandiri Capital Indonesia.

In addition, Agriaku added the list of strategic investors, such as Gentree Fund, K3 Ventures, and public company Thai Wah, which will help the company’s international expansion in the future. Alto Partners, InnoVen Capital, and Mercy Corps Social Ventures Fund also participated in the latest round.

On the same occasion, Agriaku also welcomed two new figures in its leadership ranks, Abraham Seodjito (CSO) and Valmik Mirani (CCO). Abraham previously worked at Traveloka Thailand as Chief Product Officer of Financial Services. Meanwhile, Mirani is Assistant Vice President at Paytm and Vice President for Marketplace Strategy Office at Tokopedia. These two leaders will strengthen technology-based solutions and operational performance at Agriaku.

In an official statement, some Agriaku investors also have a statement. Alpha JWC Ventures’ partner, Eko Kurniadi said that agriculture is one of the biggest contributors to the Indonesian economy, but this sector still faces many inefficiencies, including in the supply chain.

Agriaku is best positioned to empower Toko Tani by securing a consistent supply of agricultural tools at transparent prices, expanding its supplier network, and providing the necessary financing to grow its business. “We are happy to collaborate and be a part of Agriaku’s journey,” he said, Monday (11/7).

ARISE’s Partner, Aldi Adrian Hartanto added, “It was an honor to witness the extraordinary execution by the Agriaku team from day one. We are proud to continue to support the team for the third time and beyond to empower more Toko Tani and other agricultural stakeholders across the archipelago.”

Agriaku product

Agriaku was founded by Irvan Kolonas and Danny Handoko in May 2021. This startup aims to increase farmers’ productivity and income backed by technology. This is because the agricultural sector in this country contributes 13.7% of GDP 2020. However, the upstream agricultural market is highly fragmented with an unorganized value chain.

“The fragmented upstream agriculture industry makes it difficult for farmers, suppliers, and retailers to get what they need on time, resulting in frequent supply and price volatility. In addition, they also have problems with low manual work efficiency, inadequate logistics services, and limited access to financing,” Agriaku’s Co-founder and President, Irvan Kolonas said.

In overcoming these problems, Agriaku provides a B2B marketplace platform, connecting producers and suppliers so that they can provide farming tools directly to retailers (Toko Tani) at competitive prices. Furthermore, Toko Tani will distribute the products directly to farmers. Agriaku has two applications, Agria Aku Mitra App (to serve Farmers’ Shops) and Agriaku Seller Web (for suppliers).

It is said that Agriaku is now available in more than 500 cities in Java, Sumatra, and Sulawesi. The company is to expand services, establishing its position as a provider of comprehensive agribusiness solutions. The fresh funds will be used to expand Toko Tani’s network and its distributors, also the product and technology team, therefore, they can continue to innovate.

Irvan said AgriAku will focus on optimizing the economic unit and expanding revenue with innovation through value-added services, including logistics and financing to distributors and manufacturers to help them grow operationally with the AgriAKU platform. “We will strengthen market penetration by expanding toko tani and distributor networks, as well as business expansion to provide agricultural products.”

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Original article is in Indonesian, translated by Kristin Siagian

Application Information Will Show Up Here

Crypto Asset Platform Blocknom Temporarily Terminate its Services due to License Issue

July 10, 2022Englishblockchain, Blocknom, Crypto Earn, cryptocurrency, DeFi, Y CombinatorCorry Anestia

Crypto-asset earning platform Blocknom announced to temporarily halt its services from July 1, 2022. Blocknom did not specify the reason, however, it is said to consider the market situation and government regulations. On the other hand, the company is yet to have an operational permit or authority license, in this case from CoFTRA.

In its blog post, Blocknom’s management said to discontinue support for Decentralized Finance (DeFi), for which daily interest on USDT, USDC, and XIDR will also stop accruing.

“At this time, we advise you to withdraw your assets from the platform as soon as possible. You need not worry because your assets are safe. Please withdraw all your assets before July 31, 2022,” stated on the post.

According to management, the platform has stopped accepting new users and deposits since June 20, 2022. In order to simplify the asset withdrawal process, it appeals to users to immediately withdraw assets before July 31, 2022. After that, it is most likely that withdrawals will only be made via offline CS.

“We will come back stronger with more services as soon as we get our license. Please wish us luck.” Blocknom team stated.

Recently, crypto asset management services have risen in Indonesia. This is in line with the increasing number of people diversifying into this virtual currency. According to CoFTRA, as of February 2022, there are an estimated 12.4 crypto investors.

Aside from Blocknom, with a unique mechanism, several startups also offer crypto-earn services, including NOBI and Finblox. Both have received equity funding support from venture capitalists.

Recently secured funding

For a general note, Blocknom was initiated in January 2022 by former Gojek & Shopee employee Fransiskus Raymond and former engineer Ritasi Ghuniyu Fattah Rozaq. Blocknom is known to be one of the incubation startups in the Y Combinator batch Winter 2022.

Blocknom has recently secured seed funding of $500,000 or over IDR 7 billion from three investors, including Y Combinator, Number Capital, and Magic Fund last March.

In increasing the added value to its platform, Blocknom offers deposit yields on stablecoin-based crypto assets, namely USDT (Tether), USDC (Circle), and XIDR (StraitsX).

In addition, Blocknom applies transparency to the fund management process and has proof of a community system in the DeFi selection process for managing investor funds, and unlimited incentive programs for its community.

Since the last few months, Indonesia’s digital ecosystem has been hit by a bubble burst phenomenon due to global situations and conflicts. Crypto asset prices are also reported to continue to fall, including Bitcoin and Ethereum.

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Original article is in Indonesian, translated by Kristin Siagian