Author: Kristin 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.

Some people say entrepreneurship is like investing. It is often said that to be a successful investor, you have to think like a business owner. Technically it makes sense. Achmad Zaky is one of the inspirational stories of entrepreneurs who left his previous growth company to build a new venture in the tech investment landscape.

As a Founder & former CEO of Bukalapak, Zaky becomes one of the pioneers in the local e-commerce industry. Through his hard work, he managed to build an e-commerce site in 2010. After a decade of building and nurturing Bukalapak, he resigned as chief executive officer (CEO) of Bukalapak effective January 6, 2020. However, he is still an active advisor to the Board of Commissioners in the unicorn.

Zaky started Bukalapak with his hometown schoolmate, Nugroho Herucahyono. Before establishing Bukalapak, Zaky and Nugroho already had a company called Suitmedia. Being friends and partners for the past 20 years, they decided to set up another venture in the form of a VC fund, called init 6, currently deploying funds from their personal pockets, to invest in early-stage startups in Indonesia.

This is a profiling session with Achmad Zaky sharing his experience building ventures and insights on the tech startup and investment ecosystem in Indonesia.

After a decade of building and nurturing Bukalapak in the e-commerce vertical, you’ve recently entered the tech investment scene with Init 6. How does the VC life been treating you lately?

It is marvelous. I mean, in Bukalapak, we’re kind of single-minded. It’s all about e-commerce until the very technical aspect. In the VC industry, it is more horizontal, with all the industry potentials. Also, this industry is quite challenging, that is actually part of the reason I shifted from the e-commerce sector, to seek more challenges. It’s also been ten years and Bukalapak has grown this big, mature, and independent. In a parable way, I consider Bukalapak as my big-grown child, and in order to grow the ecosystem, I need to create a new venture. Not easy, but I’m refreshed now.

Back in those days of Bukalapak, how do you feel about leaving your first-big-venture? How is it different from managing a company and VC?

It’s very difficult. I think this is what my parents feel as they sent me to college. However, when I see the Indonesian ecosystem, it’s clear that we need a more mature ecosystem. In order to reach that stage, there may have required more unicorns. With the existing ones, hopefully, the alumni including the founders can make another success story. It is for the sake of the young generation because they also need a role model.

Again, in the e-commerce area, it’s quite single-minded. Every day I go day by day move vertically to learn e-commerce to the technical aspect because I’m the founder. As an investor, it’s different to some degree. I savor the e-commerce sector very well, my ability expert on a specific industry. However, as investors, it’ll definitely not going to be just about one sector. I learned a lot for a while now, regarding the fintech sector, cloud computing, SaaS, as we recently invest in

In this tech investment landscape, I need to gain extensive insight from the industry.  Therefore, in terms of knowledge, it will not be as deep as when I was in e-commerce, but it’s absolutely fine. As an investor, I’m not expected to be Mr. Know-it-all. We have Founders who we believe have expertise in their field and we’ll take a perspective where they may lack, such as experience and network.

When you first started building this new venture, is it the same feeling like your first time in Bukalapak? Please do share a bit about the journey.

It all started with a dream. Nugroho and I have been friends since high school through university, it has been almost 20 years. Along the journey, we realized that we have a shared dream about how Indonesia can have lots of tech companies. As we noticed that the global war is all about technology, and Indonesia should drive the industry. The young generation must be able to compete in the future industry.

The world is now dominated by tech companies, while Indonesia still lacks those ventures. Also, we’re not to be complacent with all the achievements in Bukalapak by challenging ourselves. Can we create more unicorn in the next ten years? Then it becomes our personal challenge. If we can only create one unicorn in the last 10 years, hopefully, we can create more in the next span of ten years.

As good as it impacts the industry, it also affects the country positively. Especially with many young generations are motivated in being a player rather than just the end consumers. It is also our dream to cater to global demands with more Indonesian products. I’m not saying this is an easy task, it will be hard indeed, that is why we’re very thrilled. The biggest challenge is in front of us, to solve as many problems at a time. The way quite varies, it can be through another startup venture, but instead of doing something we’ve done previously, we tried to contribute to the same amount by supporting founders.

init 6 is relatively new in the tech investment landscape. What is actually drives you to invest and what the key qualities you look for in a startup? What kind of VC do you want init-6 to be?

We are industry agnostic. In fact, we’ve been invested in 6 companies, and two of those are edtech. We seek for every industry, particularly in the most problematic area. Edtech is one of them but not the only one. This sector is lucrative and quite sexy for startups to disrupt and solve many problems.

In addition, when we invest in one, we’ll look for a founder with the capability and clean track record. Another extra point when the founder can grow the company with only a small amount of money. That’s the kind of founder we look for as if we’re looking at ourselves in the mirror.

However, as an expert, as I am in e-commerce sector, in my hypotheses, the sector has no longer become a problematic space. There are several unicorns that have done quite a good job of solving the problem. Except, when there is a sub-sector with quite an issue and sexy enough, we’ll consider to tap in.

Also, we’re kind of a typical executor investor. In other words, investors with more execution capability. It’s not the same as a venture builder, but we’re more than willing to help founders scale-up through collaboration and technical assistance. Indeed, exit becomes one of the goals, as it would also grow the ecosystem. That is also our goal for this venture. I think those are the key qualities we look for since we always want to keep things simple.

This is not an ideal situation for everyone. How Covid-19 affect your company and its portfolio? Given the situation that the venture debuts at the beginning of a crisis.

In fact, we saw this as an opportunity, when we first started at the time of the pandemic. The crisis becomes a natural screening, of what kind of startups worth invested and whatnot. Honestly, one of the reasons we launched this fund is due to pandemic Covid-19. We invest in early-stage startups to build a new way of life after Covid-19. We invest in great founders. We love technical founders with the passion to solve big problems. We understand their challenges and we are not afraid of getting our hands dirty in helping them.

The pandemic accelerates the digital era. People can’t go anywhere, even school must be held online, and digital becomes one and the most reliable tool. In terms of the founder, it is expected that founder quality will be improved, as the pandemic becomes a test. I called this venture a Covid University. Later, the Covid graduates will be very good in quality and mental. This is what we also encourage our portfolios. They are beyond ready to face this crisis with a number of anticipations. We believe this mental quality remains even after Covid-19, therefore, the company can achieve growth at all times.

I noticed a few startup founders who eventually becoming an investor or create a VC fund. Do you consider this as some kind of level-up or do you have other insight?

The thing is, it is very important for ex-founder or those contributed to the development of the Indonesian tech startup landscape to stay active in the ecosystem.  We should perceive to grow our tech industry. There are many ways, which I personally decided in the form of a fund to back founders. Others might have their own channels, as long as they didn’t leave the ecosystem.

Some people can be very disappointed that they want to just stop and look for another industry, it is unfortunate for the ecosystem as if losing a small part of the brain. This is also what we’re trying to plant in the Indonesian culture. In Silicon Valley where the ecosystem has been mature, failure is common. In fact, people/founders who fail will have a better accumulation of knowledge. It is because they did what they’ve done and gained a lesson for the next venture.

In Indonesia, it is only natural to blame the founders. I think that’s the mindset/scene that our country needs to develop. There have to be more success stories from people who experience failure. That failure is not always a bad thing. Also, we, as founders also aware of the fact.

When the news spread of you leaving Bukalapak, there’s this plan about a foundation. What encourages you to do so? And how is it the foundation nowadays?

I mentioned supporting the young generation and create a foundation. In terms of supporting the young generation, it is through init 6. Moreover, Achmad Zaky Foundation is also quite active in supporting the education sector, such as building a school, providing scholarships. Honestly, this is partly because both my parents are teachers. They grant me a mandate to support Indonesia’s education sector, not limited to basic education, but also entrepreneurship skills and so on.

As an entrepreneur and investor, what can you say about the tech startup and investment landscape in Indonesia? In terms of founders, challenges, and projection.

There are two key factors, it is the seed and the environment. These are cross each other’s path, not in a black and white form. When we want to grow the seed, the land must be fertile, if we are to nurture, it’s the environment. There are people who are born with the gift of entrepreneurship, but I believe the success comes from above.

We, through our fund, will try to nurture as many startups with a little we have.  I’ve done my research, there are some countries with fertile land to grow startups. Indonesia indeed a leading environment in Southeast Asia, but not in the global competition. The indicator varies, from the high rate of a startup per capita, high exit rate compares to the less fertile land, also the numbers of startup employees. In the investment scene, when the exit rate is high, investors will be attracted, it will create more founders. This is quite a chicken and egg situation. Indonesia still a long way to go, and it starts with the investor and founders.

The cycle usually takes a decade, soon there will probably more exit news. I’ve been observing that Indonesia has quite a low exit rate with other countries in the same league, such as Israel and Berlin. In terms of the ecosystem, we have loads of homework. However, if we can be a leading market in Southeast Asia, why not upgrading the standard into a more global market. If we are to achieve big, we must dare to dream big.

It’s been over a decade you’ve been actively contributed to the ecosystem. During your journey, what is the most important lesson learned in the Indonesian tech industry?

To be honest, there are a lot of lessons learned. I’m here to speak as a startup founder because it’s still too early as an investor. As a founder, perseverance and experiment may be the most important practice I’ve learned in the startup industry. As a founder, we should never easily satisfied and always create innovations. Improve your standard growth by growth, and do not ever give up experimenting. I think that is also what has brought Bukalapak this far, innovation first.

The startup ecosystem is dynamic, it can be attached to a big space hypothetically, but uncertain. It’s not as simple as corporate launching a product. The market might not be ready, it requires an experiment and strong will. The startup is to bridge dreams with reality.