Category: English

English articles about technology startup, ecosystem, and industry in Indonesia

Lists of Services for SME Empowerment

The SME business has entered a new chapter of competition. Many are using digital services through their business process. A simple one is the use of social media as a promotion channel. Aside from offering a cheaper cost, the campaign is also effective to reach more people in a short period. However, what SME players need to know, there are many other digital services to help them grow business. Here are the list of some products/services to empower the SMEs.

E-Commerce platform

Nowadays, who has never shopped through e-commerce? E-commerce industry and services have quite rapid development for the past 10 years. Many useful features are launched, many beneficial integrations are performed. For business players or SMEs, e-commerce is one option to connect with buyers, wherever they are. In addition, the complaint mechanism has its own marginal advantage, because basically e-commerce puts the safety of sellers and buyers in their ecosystem. Here is the list of some e-commerce platforms:

Transaction system or POS

The POS (Point of Sales) system or service is an important part of a business. It can be very useful for stalls, cafes, restaurants, or in any form related to transaction recording. Today, SMEs or businesses do not need to develop their own software because there are many have provided for them. In the form of SaaS, or simply put, users only have to subscribe to an account. Some providers are even integrated with payment systems and other systems. Users can also manage some lines through one account, monitoring one sale through one dashboard. The following are POS providers that can be used by businesses or SMEs.

Employee Management

One of the challenges of SME business is developing a system to manage employees. There must be a system to record neatly and easy to manage. Since the digital startup industry began to flourish, services offering employee management have risen. Not only the employee profile records, but the offered system can also handle the term of attendance, leave, salary, to managerial forms of other employees. Here are some digital services SME can use to manage their employees.

Logistics

Are you starting an SME business that requires a logistics or warehouse management system? Difficulties in developing a shipping and warehousing system? Having trouble finding the simplest way of shipping goods? All these problems are questions all logistics startups trying to solve. The developed and offered system is the answer, integration and delivery management system are provided to help businesses and SMEs despite the difficulty in the logistics sector. The following is a list of startups that provide digital solutions in logistics.

Financial Management

One of the reasons for businesses or SMEs’ failure is poor financial management. Starting from recording transactions to the whole financing. When paper records are no longer effective and special software is required for an easier and cheaper process, many startups begin to see this opportunity. The following names are found as an integrated financial recording solution, the same goal, helping businesses and SMEs in financial management, therefore, they can focus more on business management and future plans. The following is a list of startups that present financial management solutions for SMEs.

Capital Funding

Capital is an important part of business or SMEs. Not only to start but also to develop. Usually, the bank is one way out for this capital issue. Luckily, there are many options to raise capital with a variety of amounts. Two of them are P2P lending and equity crowdfunding models. One is given a loan, one gets capital by “selling shares” to several investors through a platform. The following is a list to support businesses and SMEs for capital funding.

E-commerce enabler

One of the advantages of digital solutions is integration. When you’ve been given a list of e-commerce platforms that can help SMEs develop their business before, here is a list of services that provide a dashboard or a page to manage sales on various platforms. Complete with data management and features designed to manage massive sales in one place. Often referred to as E-commerce enabler. Here’s the list:

Tax

Everything will eventually go digital. Currently, there is a solution for the tax management process, because there happens to be a startup offering its management services. Once again, this could be one solution for SMEs to pay taxes regularly. Here’s the list:

Chatbot

As an SME business that connects with buyers through online channels, of course, a fast response is mandatory. In addition, informative act and polite language is a must. In the business phase that develops one or two employees will certainly feel difficult, and chatbot turns into a solution. Chatbot is a technology, where there is a system that is able to answer buyers’ chat automatically. Standard questions such as availability, price, and the how-to-purchase issue can be answered in just seconds. This is certainly important for SMEs who need an effective system. Here are some startups that offer easy chatbot development solutions.

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Original article is in Indonesian, translated by Kristin Siagian

Jamiphy Aims to be a “Tiktok for Musician”, Focusing on the Indonesian Market

The high penetration of entertainment platforms, such as Smule and Tiktok, has captured the local creator’s attention creating content and encouraged Jamiphy to focus on the Indonesian market. Officially, Jamiphy has been launched in Indonesia in early March 2020.

The platform from San Fransisco, United States is targeting the Indonesian market because many of its followers on social media come from Indonesia.

Jamiphy is one of the participants of the W20 batch Y Combinator acceleration program with Newman’s and two other Indonesian startups.

Jamiphy’s CEO, Owen Carey told DailySocial, “Jamiphy is made specifically for musicians and music lovers. Everyone knows and many are using TikTok, except for musicians. We have made the platform easier for musicians to make great videos, and for users to find and find the music they like. ”

The way that Jamiphy works not much different from other content creator platforms. For the monetization strategy, Jamiphy applies advertising.

“Although not many machine learning technologies have focused on audio and music yet, with the deep learning structure in general especially and the increasing use of mobile phones, the application of artificial intelligence technology has become very useful. In the future there will be more technology that we will present,” Owen said.

The use of AI technology, Owen said, is also to maximize the video recording process by content creators. Jamiphy is said to have applied deep learning technology for the past 3 years.

Part of the Y Combinator program

A platform for musician and music lovers
A platform for musician and music lovers

Jamiphy is one of the startups who participate in the Y Combinator demo day program in March 2020. After obtaining seed funding, the company is targeting to have 100 thousand active users in Indonesia and then expand to India and the United States.

Without local team and a clear view of the Indonesian market directly, through interactions on Instagram and Facebook, Owen claims to know more about the tastes and trends of Indonesian musicians.

Next, Jamiphy has plans to recruit local talents to strengthen its platform in Indonesia. To date, Jamiphy is said to have around 3000 active users and is experiencing a 50% growth every week.

“Although we have quite big competitors, with the current technology, they should at least be able to update and change their feature set or create new applications,” Owen said.

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Original article is in Indonesian, translated by Kristin Siagian

Application Information Will Show Up Here

Indogen Capital is an Industry-Agnostic, Bridging Investors to Indonesian Market

The VC industry continues to grow in its significant way, as the Indonesian market still one of the most crowded in the Southeast Asia region. One of the contributors is Indogen Capital, a sector agnostic investor in Southeast Asia with deep operating experience in the Indonesian market.

In terms of resources, Indonesia is very attractive with all the dynamics in lifestyle and businesses. Indogen Capital, as a VC with family-business background experiences and powerful network, aims to be a value-adding partner for overseas VCs looking to grow in expand into the Southeast Asia market, particularly Indonesia. That is supposedly what makes them different from other VCs.

Indogen Capital’s Managing Partner, Chandra Firmanto said, “Indonesia becomes prime for the digital market, and we see that it’s getting aggressive. Most big players are not local, they didn’t have knowledge of our culture and habit. I see an opportunity for venture capital to help overseas VC to expand its portfolio.”

Investment focus and target

As a venture capital, profit becomes the ultimate goal. Although they claimed to be an industry-agnostic, Indogen Capital commits to investing only in hot sectors, such as fintech, lifestyle (including esports), logistics & e-commerce, AI & Blockchain, and Edutech.

“The metric is clear, there must be value in technology. Therefore, the financial institution needs your service

In terms of stage, Firmanto said the VC is specialized in pre-Series and Series A. They only target post-seed, not the seed level due to high-risk. However, he admits that the company has exceptions, particularly on the organizations that involved professionals or serial entrepreneurs.

The target has always been clear, it’s to exit, but the approach can be different. There are three ways of exit, shared by Indogen Capital’s Managing Partner. First, it’s from the IPO. In this case, there will be lockdown period [6 to 1 year] to fully exit. Second, exit through a major acquisition. This one is likely to happen and valuation is quite flexible based on demand. Third, is a secondary exit, where you can trade established shares to other VCs or investors.

“The secondary exit is very attractive, it is the reason why we have to build a good relationship among VCs,” Firmanto added

The portfolio story

Indogen Capital began operation in late 2016, it’s when the Managing Partner, Chandra Firmanto, has graduated from his family business and initiated something new with some friends. They started to invest in organizations since 2017 and managed to invest in 18 portfolios today, including the leading car trading platform in Southeast Asia, Carsome, and the online marketplace of local Islamic fashion designers’ products in Indonesia, Hijup. The latest one is a short-term rental and property management platform, Travelio.

Among the 18 portfolios, three have exited. The first one is Spacemob which acquired by WeWork in 2017. Second, they exited from Clearbridge Health by IPO on the Singapore Stock Exchange. Last but not least, AINO, a payment solution for transportation and government sectors in Indonesia which partially acquired by TIS Corp.

“VC is indeed a competition. However, when we have added value, it may turn into collaboration. In this case, we have powerful networking and willingness to hands-on,” Firmanto said.

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Behind the success stories, there must be lessons learned. In this case, Indogen Capital happened to experience not-so-good investment to one of the on-demand housekeeping and laundry services in Indonesia. It’s a complicated issue concerning future plans. At that time, we simplify our exit scheme and too focused on small matters.

“One thing I learn, the most important is to confirm with the players whether they demand to have certain services in their ecosystem,” Firmanto said.

Fundraising terms

Indogen Capital has closed its first fund at US$10 million with only local LPs involved and already 80% deployed. Currently, they are aiming for US$50 million second fund, soon to close the first US$10 billion from global networks, such as Hongkong, Taiwan, South Korea, and Japan. Regarding the rest billion, Firmanto said the team has reserved space for big corporations from other countries.

Every startup has a different kind of special needs, Indogen Capital tries to accommodate all these through the right investors. That is the reason behind their first fund involved only the local LPs. This is what becomes their strong point. The investors come from not only Java Island but all over Indonesia.

“You cannot be the investment partner for Indonesia if you can only support Java,” Firmanto said.

Regarding ticket size, they set around 200-500 thousand at the first fund. “We’re not even a threat to other VCs. It’s rather an advantage than a disadvantage,” Firmanto continued.

It is said that they have consistently exceeded their annual investment return target of thirty percent year-on-year. The team is very aggressive, they even set a target for 3-5 return in 7 years.

The Hope Remains for Logistics Sector Amidst COVID-19

The corona disease (COVID-19) is entering a new chapter. The World Health Organization (WHO) has announced the global pandemic. Indonesia followed the lead by declaring it a national disaster.

The economy was clearly impacted by this pestilence. The tourism and hospitality business is the most visible example to imagine how devastated after the explosion of the COVID-19 case in the world. This is not much different from the logistics sector which is very close to the impact of the corona virus.

Keep in mind that China is a global production hub in the current economic era. The crippling of most of the Chinese economy has disrupted the supply chain to its trading partners, including Indonesia. The effect spreads regardless of national borders.

Chinese Significance

The Chinese country is an important trading partner for Indonesia. It is visible from the value of trade transactions between the two countries which has reached US$ 72.66 billion in 2018. This figure takes a portion of 20 percent of the total trade that occurs with all partners.

Seen from the nominal it is also known that import transactions from China touched US$ 45.54 billion. Many imported raw materials needed by the domestic industry are imported there.

Chairman of the Indonesian Logistics Association (ALI) Zaidy Ilham Masita said the import tap from China had dropped 30 percent due to the corona pandemic. Shipping goods via sea is very limited, while shipping via air has been banned since last January. Exports have the same fate. Shipments to China are becoming sluggish at this time.

“Our exports to China also experienced a decline, especially perishable exports or fresh goods because China closed imports of fresh food. So for exports and imports the impact was quite severe,” Zaidy told Dailysocial.

The story of logistics players

Crewdible is one of the startups affected by this disaster. Being in the field of warehousing, they admit that their business has stalled. The CEO, Dhana Galindra said the productivity of all of their sellers dropped dramatically since the outbreak.

Logisly suffered a similar fate. The logistics business that bridges the needs of all types of freight trucks is directly affected. The CEO, Roolin Njotosetiadi stressed the sluggish export-import activities caused demand to fall on their platforms. “The container business is the most declined,” he added.

Zaidy Masita, who is also the Paxel‘s COO, said that the situation in the logistics landscape has worsened after several countries adopted a lockdown policy. China, New Zealand, Poland, Denmark, and Italy are examples of countries that have locked themselves in their struggle against the corona virus.

The situation in China is the main focus because they are like the epicenter of the global supply chain. Quoted from the New York Times, the problem in China is not in the inventory. Ports and customs have been called almost normal. The problem lies in the lack of trucks that come to deliver and pick up goods to the port. The government’s decision to impose a quarantine to lock up an area to reduce the spread of the corona virus had to be taken even though this meant to tear down their economy.

Looking for hope

In an uncertain situation for this economy, logistical startups must rack their brains to find solutions to survive. As a relatively new player, Logisly strives to continually add new shippers and transporters. It is required to patch up the quiet demand for trucks that they offer on the platform.

A similar method is taken by Crewdible. The difference is, this online warehouse platform focuses more on certain types of products. “We are more focused on local goods and fresh products now because imported goods are gone on the market,” said Dhana.

Fresh products seems to be excellent in times of crisis like this. Anticipation is higher for activities outside the home causing increased demand for fresh products. Besides Crewdible, this was also experienced by Paxel.

Zaldy said that since the corona virus became a serious threat to the community, shopping centers and food shops that were operating were increasingly limited. Therefore he was not surprised that the demand for food ingredients had risen sharply.

“In terms of Paxel, because we focus on the same day [delivery] between cities in Indonesia, even since the corona virus broke out, our volume has risen to 40%. Food and perishable shipments have risen sharply.”

In addition, Zaldy is quite confident that Paxel’s business model that relies on smart lockers can be a solution for delivering goods in situations like this. “Indeed, there are many disasters in Q1 2020 that we experience and logistics companies must be able to survive and change their business processes by using more technology,” concluded Zaldy.

Possible stagnate

The logistics industry in the country did experience many disasters during the first quarter of this year. After many times their operations were disrupted by flooding during January and February, now the corona virus is their newest block.

ALI, which previously targeted industrial growth at 12-14% with a contribution to gross domestic product (GDP) of Rp993.9 trillion, is predicted to be canceled. According to Zaldy, logistical growth for this year will be stagnant compared to last year’s achievement which was only 7-9%.

To date, no one knows how long the corona outbreak will continue to spread. While researchers are still struggling to find the right formula to fight the virus, the governments of each country are struggling to reduce its spread. As of this writing, Covid-19 has caused 117 cases with 8 patients recovering, and 5 patients dying in Indonesia. Meanwhile, the central government and a number of regions have encouraged residents to limit their activities at home to reduce the transmission of the virus.

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Original article is in Indonesian, translated by Kristin Siagian

7 Highlights for the “Work From Home” Strategy by Gojek

The COVID-19 pandemic in Indonesia encouraged a number of companies in Jakarta to begin the “Work From Home” or WFH policy from Monday, 15 March 2020. This policy was no exception for unicorn startups, including Gojek.

This decision was inevitably taken by company officials to reduce the spread of the COVID-19 virus which was increasingly unstoppable, especially in the Jakarta area as the economic center in Indonesia.

Meanwhile, Gojek is one that captures the attention regarding WFH’s policies. It is not stated whether this policy applies to all employees or not. The management of Gojek said the work-from-home trial will last for a short period.

“Compared to a combination of employees working from the office and home, or from home for 1-2 days, it feels like working full time from home has its own unique challenges. Having a team that is spread out in various locations means it requires a number of different ways to communicate with each other, make decisions and connect with each other, “Gojek management stated.

For this reason, DailySocial summarizes a number of important notes from Gojek for managers and staff. This note can be guidance for new startups.

Set limits when working at home

Prepare your own workspace in one of your home spots. This is important to create a comfortable, focused work atmosphere and avoid distractions. Don’t forget, for those who are married and have children, you need to give a “signal” that this is your time to start working.

However, don’t hesitate or worry, if your child makes a sound or suddenly appears on the screen while you are having a conference call with the team. They certainly understand.

Prepare a channel for communication

Communication is the most important element in work. And now Slack is the “virtual workspace” most used by professionals. Now, make sure your status remains “online” so the manager knows that you are always active to be contacted.

It should also be understood that the response in the office will certainly be different from at home. To manage your expectations in communication, make sure the entire team and manager prepare an alternative communication channel if the internet connection is unstable. Email and WhatsApp for example.

Over-communicating doesn’t matter

Because it is not under one office roof, of course, there will be adjustments when communicating between teams. For example, coordinating work problems. In some cases, don’t assume that your team knows everything.

So, there’s nothing wrong to say it back – if necessary over and over – about what you are doing. This is to reduce the potential for ambiguity/miscommunication/misinformation from your team.

Managing daily productivity

As a manager, one of the other challenges of WFH is managing and measuring the productivity of each person on your team. To make it easier for you to get started, you can set a work schedule, if necessary, set time on Google Calendar to your team.

Then, manage your expectations of team productivity. First, set and share everything to your team. For example, telling what will be done today or how to deal with a crisis in a situation. The more clear and concise the daily process and plan on your team, the less likely your team will be confused and ask questions.

Next, ensure to your team that time is worth the effort. One of the advantages of working in the same room is a fast response from your team. Since working from a different location, encourage your team to work on an easy task intelligently, not linger.

Manage your focus on work

When you work from home, one day will just run out just to check Slack and email. As the head of the team, you need to arrange a time with your team about when you will receive a report. If you need to make provisions, such as reports in the morning and evening.

On the other hand, you also have a load of work that needs to be completed. Decide on a priority job and temporarily turn off Slack or e-mail so that you are more focused. This can be done while waiting for your team to finish their work and report back to you.

Break the ice with emojis

In situations like this, we will be more sensitive. Thus, this becomes a reminder for the head level and staff to always be careful in speaking and gesturing, both oral and written. To reduce tension, you can use softer tones by saying “Help” and “Thank you”. If you need to include emojis like this 🙏.

Don’t forget to take a break

Working from home is indeed very challenging considering the house is a place to rest, not work. Now, in this case, there are times when you will be very focused on doing something. Do not forget to take about 1-2 hours to rest from the computer.

Occasionally you can do small exercises by stretching your body. Or you can do other relaxing things, like cooking or watering plants, before returning to your computer.

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Original article is in Indonesian, translated by Kristin Siagian

Analyzing Traveloka’s Potential as a Fintech Company

As a well-known unicorn in OTA vertical, Traveloka has now available in seven countries. The service is not only focus in accommodation and transportation. The company business has reached lifestyle and financial segment.

The last-mentioned sector is said to be the main umbrella on all transactions in Traveloka. Traveloka now provides more than 40 payment options, online or offline, including paylater service and insurance products.

The urge to travel, according to some research, has become part of the so-called millennials lifestyle. There are many supporting factors, including the improvement of road infrastructure and internet network, regional and central government’s encouragement to increase economic potential from the tourism sector, also transportation vehicles and various accommodations.

In other words, combining tourism with a big ticket size and financial needs become the key to provide the “buy now, pay later” service.

Since the establishment in June 2018 to date, Traveloka never reveals the PayLater service achievement, in terms of numbers of distribution, customers, and the bad credit.

traveloka fintech

However, we can get the picture from PT Pasar Dana Pinjaman (Danamas) as the first partner. Danamas, under the Sinar Mas Group becomes one of the first p2p lending to obtain license from OJK since 2017.

In an earlier interview with DailySocial, Danamas President Director Dani Lihardja revealed in the first year, the total distribution of Danamas through the cumulative figure of Rp1.4 trillion. The biggest contribution came from Traveloka in the amount of Rp1 trillion and the rest was commercial distribution to credit traders.

However, PayLater’s contribution has increasingly decreased by Danamas. In fact, he said it was minimal, although the exact numbers were not mentioned. This condition occurs due to many factors. First, Traveloka PayLater’s target users are mostly non-formal workers, not in line with the vision and mission of the company that targeting the informal and productive segments. As a result, Danamas cannot expand customers for more productive loan needs.

“Traveloka PayLater users are educated customers and the informal sector is not working here because most of them are white-collar. Therefore, this is quite different from our vision and mission to raise the unserved so that they are served, “he said.

Second, the funding source partners for Traveloka PayLater continue to grow. Besides Danamas, there are now Caturnusa, BRI and BNI. Nevertheless, Dani will not stop the cooperation agreement with Traveloka. “From the beginning we were not exclusive, we were willing because the ecosystem is the same as us. Borrowers don’t accept money, if the ecosystem is different, then we don’t want to.”

A good proposition

As a brand, Traveloka PayLater has a strong presence. Also, product diversification and broad function of funds attract lots of parties for cooperation.

In terms of function, Traveloka PayLater loan limits can now be used to pay for all transactions in the application, also in offline outlets thanks to the realization of cooperation with BRI in the physical form. All transactions through the card will be recorded in the application, there’s even a feature for paying bills.

Traveloka PayLater co-branding with BRI / Dailysocial
Traveloka PayLater co-branding with BRI / Dailysocial

Previously, in October 2019, BRI reportedly explore the potential to invest in Traveloka. Until the news was revealed, no decision had been announced to the public.

After BRI, other state-owned banks have followed to have cooperation with Traveloka, targeting Traveloka PayLater specifically. BNI, as a new source of funds and Bank Mandiri for credit card co-brands without any attachment of the PayLater brand.

The offered facilities are the opportunity to collect more loyalty points from transactions at Traveloka, daily discounts, and other offers from Bank Mandiri merchants. This is Traveloka’s first co-brand with banks to release credit cards.

Traveloka PayLater as a potential unicorn

Traveloka Group President Henry Hendrawan, in an interview with Reuters at the end of 2019, stated, “Financial services as a whole started from almost zero in early last year and we hope that it will easily become a $1 billion business next year.”

DailySocial tried to elaborate further on Hendrawan’s statement, but Traveloka’s representatives refused to answer it.

Hendrawan’s statement indicated high optimism in his fintech business, there was even news that the company was raising special funding for this product line. It is not impossible, with a unique proposition that can make Traveloka’s fintech business (read: Caturnusa) bears the status of a unicorn, following its parent entity.

Traveloka's Co-Founder and CEO, Ferry Unardi / Traveloka
Traveloka’s Co-Founder and CEO, Ferry Unardi / Traveloka

See on how Ovo has become the 5th unicorn, it doesn’t mean Traveloka couldn’t catch up.

Quoting from the 2019 Fintech Report, Traveloka occupies the fourth position as the most widely used paylater. The top positions in order occupied by Ovo, Gojek, Shopee. Looking at the awareness, Traveloka occupies the third position, the top position is occupied by Ovo and Gojek.

According to DailySocial observation, on the terms and conditions page, it is explained that the borrowers from Traveloka PayLater are PT Caturnusa Sejahtera Finance and Danamas.

Caturnusa is a rebrand of a finance company that was previously named PT Malacca Trust Finance. They are owned by PT Batavia Prosperindo Finance Tbk before being sold to PT Hermes Global Ventures PTE, LTD in September 2018.

Batavia sold 25 thousand shares to Hermes Global at a nominal value of Rp1 million per share. The transaction value reached IDR27.75 billion. The Indonesian Financial Services Association (APPI) Suwandi Wiratno confirmed that Hermes Global is a sister company of Traveloka.

“Traveloka has opened a multi-finance company, its name is Caturnusa. He bought it from Malacca Trust. In writing, PT Hermes Global Ventures, PTE LTD., Sister company of Traveloka,” he said as quoted by Bisnis.com, (1/28/2019).

With the new name, Caturnusa operates in the same area as the Traveloka headquarters.

Becoming financial company

Caturnusa, with its core business as a finance company, facilitates Traveloka’s movement to find sources of funds as it should’ve come from institutions. When using license as a lending company, there are limitations in finding sources of loans, which come from individual borrowers.

We can’t obtain any information of all the sources collected by Caturnusa. It does not violate the rules because there is no obligation to publish it unless it is a public company.

The Caturnusa business domain as a lender for Traveloka products also does not violate the rules. In POJK 35 of 2018, OJK explained that finance companies are given the freedom to add variations in financing products, namely multifinance.

traveloka fintech company

Multifinance is the type of financing of goods and/or services required by the debtor for consumption and not for the purposes of business or productive activities within the agreed period.

In this financing, the FSA requires that it must be done by way of finance leases, purchases with installment payments, fund facilities, and/or other financing agreed by the FSA.

In addition to multifinance, in general, finance companies also have other product domains, namely working capital, investment, and other financing activities based on OJK approval.

Finance companies can have many sources of funds besides banks. There are other options, such as channeling, joint financing, issuing debt from MTN (medium-term notes), bonds, syndication on / offshore, to IPO.

Because Traveloka PayLater already has a business model, Caturnusa doesn’t have to bother looking for business models that conventional financing companies do. All business processes are done online. Another story, if there is a change in business strategy for product diversification.

Playing in the online business should not be a new field for finance companies. Akulaku can be the closest example in illustrating the potential of a finance company that brings a digital approach to its business processes.

The company has three licenses, the p2p lending (Asetku), e-commerce (Akulaku Silvrr and Akugrosir), and financing (Akulaku Finance). In fact, Akulaku has also become one of the shareholders in Bank Yudha Bhakti.

As we can see, Akulaku diversified access for its funding to be channeled back through a series of loan products. Not only consumer-based loans, Akulaku said that they currently receive loans for cars and working capital that are more productive.

In terms of industry, OJK sees the incumbent players have begun to implement. Head of OJK 2B IKNB Supervision Department Bambang W. Budiawan sees that from 57 listed companies, it started to show positive progress that leads to digital. Also, given the digital transformation requires a minimum cost and standard.

“Gradually [its development]. It doesn’t matter, if there is a large amount of capital, but when it’s on-budget, it will be gradual because this will need costs and has [to meet] minimum standards,” Bambang explained to DailySocial.

According to him, fintech lending and financing have different consumer segments, although there are several products that overlap. Having a finance company is not easy because there are many requirements that must be obeyed, including having to be able to maintain the gearing ratio, which is the ratio between the number of loans compared to own capital. The company must also have large capital with a minimum equity of Rp100 billion.

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Original article is in Indonesian, translated by Kristin Siagian

Application Information Will Show Up Here

Behind Cashlez Optimism to IPO Soon

Cashlez, a fintech startup for payment gateway and mPOS, has performed corporate action to be listed in the stock exchange. According to the plan, the company aims for Rp90 billion to Rp100 billion by releasing 300 million shares or 20.29% from modal to be placed and fully channeled after IPO. The price ranging for Rp298-Rp358 per share.

Cashlez’s President Director, Tee Teddy Setiawan said, the fund raised will be channeled to acquire similar organizations engaged in payment gateway named Softorb Technology Indonesia. The rest will be for operational matters.

“Around 48.57% will be used to acquire 51% STI shares. The 51.43% will be used for company operational,” he said.

Teddy said, the company attracted to STI because of its focus on front-end. While Cashlez is focus on back-end. “We need the front-end to feed transactions, that is what STI do with their providing front-end.”

“Therefore, the business is quite sustainable. Also, we need to be major with 51%, for more synergy in terms of finance can be consolidated in order to be more healthy,” Teddy continued as quoted from Kontan.

The company appointed Sinarmas Sekuritas as the guarantor of the issuance of securities. Cashlez is targeted to pocket an effective statement from OJK on April 7, 2020 and the public offering period will take place the day after. The listing of shares on the IDX is planned for April 20, 2020.

Sumitomo Corporation as shareholders said, it believes that payment systems are increasingly needed in the coming new era such as MaaS (Mobility-as-a-Service). In this case, the Mobile Payment of Sale (mPOS) system from Cashlez will provide benefits for consumers and service providers.

In terms of performance, in the period of October 2019, Cashlez posted a net income of Rp11.73 billion, up 96.07% yoy. This increase was supported by an increase in the volume of transactions processed. Until February 2020, the transaction volume in Cashlez reached Rp1.3 trillion.

Teddy is targeting revenue growth of 120%. STI will also support its contribution as a subsidiary.

Cashlez position in the industry

One of Cashlez's automotive merchant / Cashlez
One of Cashlez’s automotive merchant / Cashlez

As an mPOS player, Cashlez expands its services by accepting payment by card, either an application-based credit card or debit card on a smartphone that can be connected to a card reader via Bluetooth.

In addition, merchants can also accept digital payment methods with QR codes (LinkAja, Ovo, GoPay, ShopeePay, and Kredivo), Cashlez-Link for payments on e-commerce sites, and virtual account payments.

The number of Cashlez merchants is claimed to have doubled from its position per August 2019 of 6 thousand merchants across first-tier cities. Most merchants come from the fashion & accessories, retail, electronics, professional services, automotive and watches & jewelry business segments.

There are many and diverse types of Cashlez players offering each of its advantages. Among them are Qasir, Pawoon, Nuta, Youtao, and the closest one is Moka. From the Moka product range, it is not only a matter of innovation in MPOS, but has touched on other verticals related to the merchant business.

In an earlier interview, Moka Co-Founder and CEO Haryanto Tanjo explained his ambition to become a “super app merchant.” The company targets 100 thousand merchants to join Moka this year, while currently there are more than 30 thousands. Two-thirds who join are culinary businesses, and the rest are retail and services.

Whether you want an IPO or not,  the online cash register adopted SaaS business model with b2b as target customers. Naturally, businesses have clearer economic units, like the roadmap to lead to profitability and a certain monetization scheme by subscribing.

Online cashier application business is actually still in the early stages, aka immature. It’s due to many merchants, especially micro, which have not been well educated about the benefits of digital applications for business development. The percentage of business people who have been reached by the digital world are still far behind those who are offline.

Quoting from the Ministry of Cooperatives and Small and Medium Enterprises (Kemenkop UKM), in 2017 as many as 3.79 million micro, small and medium enterprises (MSMEs) have utilized the online platform in marketing their products. This number is around 8 percent of the total SMEs in Indonesia, which is 59.2 million.

Worry not with the current market condition

Amidst the global economic slowdown due to the Covid-19 virus pandemic, Teddy said he was optimistic that Cashlez shares could be well absorbed by the public. According to him, the IPO is a long-term plan that has been prepared long before the outbreak of the virus.

“The impact is only from retail investors. However, from institutional investors, it continues to run,” Teddy said as quoted by Investor.id.

The company has also gathered three large investors to absorb shares. These investors were met when Cashlez held a roadshow, they were individual investors with wide networks and institutions who shared the same vision with the company.

It is well known that the stock exchange regulator together with the FSA have prepared all the steps to suppress the sluggish capital markets. One of them is encouraging institutional investors with large-amount funds to invest, namely BPJS Employment (now BPJAMSOSTEK), the Indonesian Pension Fund Association (ADPI), and the Financial Institution Pension Fund Association (ADPLK).

This momentum was used by the three institutions to buy shares of companies with good fundamentals at a discounted price. BPJAMSOSTEK has prepared an allocation of IDR 8 trillion to buy shares this year. The fund allocation is assuming that they only buy, not sell.

The majority of shares purchased are in the blue chip category which is included in the LQ45 Index and BUMN shares. As of December 2019, BPJAMSOSTEK managed funds of Rp.431.6 trillion. This money was allocated to a fixed income instrument of 71.4%, 19.09% of shares, mutual funds of 9.34%, and the remainder of direct investment (property and investments).

This type of investor has the characteristics of buying shares for long-term needs in order to get optimal profit, so that they are not sold at any time in a short period of time.

The Indonesian Central Securities Depository (KSEI) noted that Indonesia had 2.47 million capital market investors last year, up from the previous year’s 1.61 million investors. Local investors have a composition of 98.97% and the rest are foreign investors. Not much different, retail investors reached 98.89% of the total, while institutional investors amounted to 1.2%.

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Original article is in Indonesian, translated by Kristin Siagian

Application Information Will Show Up Here

Gojek Secures New Funding Worth of 18 Trillion Rupiah

Gojek is reportedly secure new funding in the Series F round, it is said to reach US$1.2 billion or 18 trillion Rupiah. According to a source by Bloomberg, based on the memo from Gojek’s C0-CEO, Andre Soelistyo and Kevin Aluwi, this round was closed per last week. There’s no further details on the participant investors. The latest news said the giant retail Amazon to join by initiating a strategic partnership.

This round targets funds of up to US$ 3 billion or equivalent to 42.2 trillion Rupiah. It has been ongoing since October 2018, with a closing target in early 2020. Therefore, the latest fund is likely to be the closing at this stage.

Unfortunately, the amount of every fundraising announcement weren’t always off to the public as the one from AIA Indonesia in last September. However, a reliable source says the total amount obtained is currently below the target of US$ 3 billion.

Consistent with the same mission, the series F fund will be focused on expansion while tightening competition with the main rival in Southeast Asia, Grab Holdings. Visa, Mitsubishi, Astra, Google, JD.com, Tencent Holdings are the ranks of investors who were previously involved in this round.

This has become the biggest fund of a tech player in the first quarter of 2020. Amidst the pessimistic for the digital business ecosystem due to some cases, including the Covid-19 pandemic that captures global attention, including Indonesia.

In addition, analyzes have predicted a slowdown in investment flows in the technology business the previous year. It includes the SoftBank portfolio issues, WeWork and Oyo; it makes investors turn vigilant in conducting business technology assessments.

Rumors about the Gojek and Grab mergers also arise, after the meeting between Grab’s President Ming Maa and Gojek’s Co-CEO Andre Soelistyo. A merger can be happened partially, involving only business in certain countries. In fact, reportedly there has been no silver lining of the two companies valuations and who will be the dominant one.

Also, there is a signal of rejection, particularly from regulators in Indonesia and Singapore, which are important market places for both companies. Moreover, if there is a market monopoly, consumers will be theones who lose the most due to their dependence on services from both companies.

Get team, Gojek's expansion business in Thailand
Get team, Gojek’s expansion business in Thailand

Aside from transportation, competition between Gojek and Grab has covered a variety of other on-demand aspects. The most obvious is currently the food delivery service and digital payments. Both continue to “burn money” in order to achieve the most optimized growth, therefore the investment cycle continues to climb.

Grab alone has begun to open the series I round. The latest is Mitsubishi UFJ Financial Group, the investor involved in Gojek funding, also involved in the US$ 856 million funding.

Gojek has performed market penetration in several countries in Southeast Asia, including Thailand, Vietnam and Singapore; in Malaysia and the Philippines are in the maturity stage. Meanwhile, besides Indonesia, Grab has already been established in Singapore, Cambodia, Malaysia, Myanmar, the Philippines, Thailand, Vietnam, and Japan.

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Original article is in Indonesian, translated by Kristin Siagian

Application Information Will Show Up Here

 

 

Understanding Strategy and Function of Community-Based Marketing

The tribal marketing approach is likely to be art than a science. Tribal is from the word tribe that means community. The community-based marketing strategy is getting popular for companies due to its focus on maintaining existing customers.

In fact, the company with a good retention rate is more profitable than the ones that only focused on acquisition. Therefore, what a startup should do to implement this marketing strategy?

In order to get further, #SelasaStartup has invited Tribelio’s Founder and CEO Denny Santoso. Tribelio is a startup that provides a one-stop management platform to help people who want to build a community and earn income from the community’s presence in their business.

This community marketing is increasingly popular in Indonesia because it is currently entering the product era. Selling is easier on any platform, but it leaves a new issue of price wars as more and more people sell the same product. The impact is consumers are no longer loyal because they choose the profit-press strategy.

What is a community based marketing?

Danny said before explaining the community marketing, that this one is part of digital marketing. Many people are usually mistaken the digital marketing as online advertising. Advertise for the sake of getting financial coffers.

In fact, it’s really not at all. First, you must understand the management of the consumer cycle, from not knowing a brand, to use the brand, until finally becoming a loyal consumer.

In attracting consumers, utilizing social media platforms from Facebook and Google is the biggest source of traffic. But if you only get the traffic, how do you want to make a sale. The thing is to obtain data from these visitors.

The strategy is usually to offer discounts for first purchases, at the registration step. Next, consumers will be given a loyalty program in the form of discounts, the latest product information, up-sell or cross-sell.

“To have loyal consumers, up-sell cannot be the only way. The key is to build a relationship. From the time they were not aware, then they bought it, and finally all of the consumers were gathered into a community. This, what business players can use,” Danny said.

However, the database remains passive, it means no sale if you do not know how to use it. As a result, the company will not be profitable by relying only on advertising. This is where community presence is needed.

This community, according to Danny, has a clear definition, that he is a group of people in a group who have one big idea and a clear line of communication.

“For example, a company has one million customer databases, members will not aware if not from the information by the leader. Because only leaders know this information. This community will not work if the communication between members and leaders does not work vice versa. The community must also be able to invite people.”

Determining a clear goal and consumer target

After the database, it must be sharply defined who is the target consumer, who is willing to buy the product. Danny pointed out that many people were still ambiguous or could not specify who the target users. If only to categorize the target consumers based on gender, age group, and location, surely no one will want to buy.

“If you set your target customers that way, you can immediately test and see that no one will buy it. Finding that ideal customer needs a process called mindset shift.”

In general, a mindset shift is a process of changing the mindset that occurs in the consumer’s brain because it is exposed by various content, whatever its form, which eventually becomes an acceptable knowledge. This process does not happen instantly.

The knowledge process is delivered in stages. The earliest is content through social media platforms to be accessed for free. Once the content has been received, consumers will extent to the next product, from books, 30 days challenges, workshops, to mastermind.

Community is not a space for sales

Another misconception is to make the community as a gathering place and the next alternative for selling. It’s not like that. People will instead turn to the marketplace platform to shop.

Danny said you have to determine what dreams each community member will definitely get if you join? Is it knowledge, network, or status? This determination is like religion, there is a faith that is attached so that members can taste the benefits when joining.

In setting this dream, one must know what the person’s dream is, then the challenges such as what prevents people from chasing the dream. This is what will make an active community, therefore, its role is crucial.

“Most people start a community with a business mindset. That must be changed by using a market mindset. A good community is one that offers future hope. The member’s dream must be resolved through the community, that’s the content, not necessarily discussing the product.”

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Original article is in Indonesian, translated by Kristin Siagian

[Weekly Updates] Facebook to Build Fiber Optic Network in Indonesia; AI Startup Datasaur Receives New Funding; and More

Facebook collaborates with Alita Praya Mitra, its local partner, to build 20,000 km of fiber optic infrastructure in Indonesia. In the mean time, we dig deeper about equity crowdfunding landscape in Indonesia, how Bubays use technology to deliver baby food product, AI startup Datasaur announces new funding round, and how Bobobox tries to revolutionise customer experience in staying.

Facebook collaborates with local partner to build fiber optic network in Indonesia

Facebook extends the Facebook Connectivity program to Indonesia by collaborating with Alita Praya Mitra, a company that provides local infrastructure networks. Facebook wants to build a fiber-optic infrastructure network for 20,000 km long to improve connectivity for more than 10 million Indonesian people.

Facebook Connectivity is an internal program from the company to overcome the problem of connectivity. In its journey, before entering Indonesia, Facebook has invested in various countries, such as Mexico, Colombia, Congo, Peru, and Brazil; it majorly penetrates African or other countries with low economic rates.

Alita and Facebook will invest in the availability and efficiency of better backhaul fiber distribution. Alita will fully own, build, maintain and operate the green field fiber network and provide large capacity for cellular network operators and internet service providers. Facebook will provide support for the fiber network planning process.

Introducing equity crowdfunding platform in Indonesia

The concept of offering stock through crowdfunding or known as equity crowdfunding (ECF) began to emerge in Indonesia. Some new platforms are adopting the concept. There are three startups officially acquired license form OJK per December 2019, namely Santara, Bizhare, and CrowdDana.

The FSA has already issued regulations regarding the ECF as stated in POJK Number 37 of 2018 concerning Crowdfunding Services through Information Technology-Based Stock Offering. It regulates platforms, investors, and the amount of money raised from crowdfunding.

Currently, the challenge has been on public education and business owners. In terms of the public, there is an urgency to socialize there are other investment options besides gold, mutual funds, or shares on the stock exchange called equity crowdfunding. Including understanding the existing regulations and risks.

Bubays baby food producers optimizing technology for delivery service

Bubays is an online channel that sells complementary foods for babies (MPASI). The idea appears when the founder participated in Antler‘s startup generator program in Singapore.

Bubays is currently focused on food types and quality, because there are many kinds of baby food in the market contain a preservative, high added sugar, even the worse is baby food on the shelves has been existing longer than the baby.

One of the Bubays products is baby porridge with various basic ingredients, made with texture variants according to the age of the child. They also assured each production process is closely monitored by nutritionists. The procedure is also ensured to be safe and hygienic.

Datasaur receives more funding, to optimize data labeling platform

The data labeling platform developer startup, Datasaur, has announced new funding worth $1 million or equivalent to 14.2 billion Rupiah. This is a same round with the last one with GDP Venture. There are some angel investors involved, one is Calvin French-Owen as Segment’s Co-Founder & CTO.

The fresh money will be used for platform capability, including minimizing bias on text labeling. As we all know, data labeling become one of the most crucial processes in the development of artificial intelligence (AI) based services, particularly in the natural language process (NLP).

Currently, the Datasaur team is participating in the Y Combinator acceleration program for the Winter 2020 batch in San Francisco. The company’s based in California and Indonesia.

Bobobox mission to revolutionize user experience in staying

Bobobox is a graduate from India’s Sequoia accelerator program, Surge, that facilitates users with pods and has its own app. The app can help consumers for door access, adjusting brightness, security feature, Bluetooth speaker, and air conditioner.

In order to enjoy all services, users are required to use applications available on Google Play and the App Store. In addition to providing a seamless user experience, Bobobox also wants to change the habits of users enjoying their stay.

Bobobox is currently available in 8 locations across Bandung, Jakarta, and Semarang. This year, they are targeting to add 8 other locations in Indonesia and to serve around 100,000 users. The company also intends to add an internal team to accelerate growth.