A Kaleidoscope of Strategic Corporate Acts in 2019

The disruptive era has been driven not only by the startup industry. In recent years, a number of large-scale corporations have taken part in developing the digital ecosystem in Indonesia.

Moreover, innovation development within the scope of the corporation or corporate innovation will come back to its main goal, a sustainable business.

The year 2019 highlighted some strategic steps with various instruments, from internal innovation incubation, collaboration with startups, and the rise of venture capitals.

DailySocial summarizes the most engaging corporate actions of some sectors within the year of 2019 as follows:

A synergy of state-owned e-money products

Last year begins with Telkomsel’s e-money service transformation, Tcash, to LinkAja. This is said to be the former SOE Minister Rini Soemarno’s initiative who wants to put state-owned e-money companies altogether into one platform.

Tcash is considered to have the most ready ecosystem at that time than any other SOE e-money, therefore, It was designated as an “embryo” for the LinkAja platform. This is quite a surprising decision since Tcash plans to become an agnostic e-money service and spin off from Telkomsel in the mid-2018.

Meanwhile, LinkAja has been announced and started rolling in February. In fact, it was officially launched in the middle of the year due to the long-await for the integration of all SOE e-money to be completed.

It is to be highlighted that LinkAja is the result of a joint venture of state-owned companies in which 25% of the shares owned by Telkomsel, 20% each for Mandiri, BRI and BNI, BTN, Pertamina with 7%, and Jiwasraya Insurance also involved with 1%.

Prior to this, LinkAja positioned itself as e-money for daily basis. Therefore, this joint venture – to be followed by other shareholders – is considered to fasten the acceleration for the company’s use case, such as transportation and gasoline purchases.

Collaboration and Innovation

Innovation and collaboration between corporations and startups have made the news in 2019. It indicates a number of business sectors have realized the power of inclusiveness towards Indonesia’s digital business development.

As an example, Gojek officially partners with Indonesian Railways (KAI) to support the integration of digital ecosystems and railroad services through orders and payments in one transaction. In this case, Gojek is the first and last-mile provider, while KAI acts as the middle mile provider.

Next, BRI kicked off the market through its collaboration with Traveloka through the “PayLater Card” launching. This co-branding partnership allows users to transact at offline and online merchants in 53 million locations worldwide and receive payments by VISA.

In late 2019, BRI is to increase its digital service portfolio by launching a BRI Ceria virtual credit card that provides loans starting from Rp500 thousand to Rp1 million. The app-based service aims for BRI customers in the underbanked segment.

In terms of telco, Telkomsel initiated another breakthrough by launching the first digital app-based cellular service product by.U. It’s called digital-based for all activities of purchase, registration, and use are fully carried out in the application.

It was internally incubated and developed through MVP, the by.U service has become Telkomsel’s strategic “weapon” to win the market in the digital era. In fact, by.U is targeting gen Z for their digital literacy and unwillingness to be “regulated” for data packages.

The rise of Corporate Venture Capitals

2019 highlights the aggressive penetration of Corporate Venture Capital (CVC). In our observation, there are four new CVCs established to capture great opportunities in the Indonesian digital industry. They include Amatil X (Coca Cola Amatil), Telkomsel Mitra Inovasi / TMI (Telkomsel), BRI Ventures (BRI), and Sarana Papua Ventura (BTN).

Furthermore, DailySocial also highlighted Nicko Widjaja‘s transfer from MDI Ventures to be the head of BRI Ventures. Nicko’s appointment as CEO is expected to bring a new success story in the coming year.

Broadly speaking, each CVC targets a different business vertical, depending on the demand and values of the company’s business development. Likewise, the funding stage. For example, TMI is currently aiming for early-stage and BRI Ventures will focus on growth and late-stage startups.

In addition to the CVC, Telkom Group has recently added more to its managed funds by launching the Centauri Fund. The new strategy is a joint venture between the telco giant with KB Financial Group, which is one of the largest banks in South Korea.

Expecting the next strategic step in 2020

Through the summarize of various corporate actions above, we can draw a common thread that inclusiveness will be the main key for players – whoever are both corporations and startups – in driving the development of the digital ecosystem in the future.

Collaboration will be more aggressive and there are more innovations to arrive. A number of Indonesian corporates have realized the power of innovation and digital transformation. Some of those, such as BRI and Telkomsel, have prepared themselves to start a new chapter in 2020.

Moreover, in line with the more mature startup ecosystem, the VC industry will be more selective for its investment. The investment climate is predicted to increase. However, we are likely to see a decrease in the initial funding.

For some reason, both CVC and VC will be more focused on growth and late-stage funding. Aside from minimizing risk — learn from the previous years — startups must have clear traction, scale-up, and monetizing plans.

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Original article is in Indonesian, translated by Kristin Siagian

Vanessa Hendriadi of GoWork is chasing her passion for connecting people: Women in Tech

Vanessa Hendriadi wanted to do more than work in her family’s real estate business, so she started one of Indonesia’s major co-working spaces, GoWork.

Indonesia is home to more than 88 million millennials. The country is predicted to be the eighth largest economy in the world in 2020, according to consultancy firm Deloitte. Its major cities are ideal markets for co-working platforms.

After graduating from the University of Southern California in 2002, Hendriadi started to work in 2004 as a marketing director at PT Atlantic Biruaya, a mineral water company that is a subsidiary of her family’s Mikatasa Group, which does business in trading, beverages, chemicals, and more. She was eventually promoted to director of operations at the holding group in 2009. and implemented changes to streamline the business.

In June 2013, she ventured out on her own and built a software system for property management called Gaea. Hendriadi, however, was not satisfied with her professional career, as she always wanted to build a business that related to her hobbies and passions. “I love food and yoga exercises, and I realized that all those industries have one purpose—building a community. So, I finally chose to build a co-working space, which combines my professional experience in property management and my passion for connecting people,” she told KrASIA in a recent interview.

In 2016, with capital from her family, friends, and the Ismaya group, a popular F&B and hospitality chain in Indonesia, Hendriadi established her first co-working space company, Rework, integrating co-working spaces with coffee stores run by Ismaya group in strategic locations in Jakarta.

As a solo founder, she was building Rework from scratch, and the workload was heavy. On top of that, her second son was only nine months old at the time, so she had duties as a mother too. “It felt like burning out, because no matter how much I would do, there would be more things left undone. It was pretty crazy. I felt like I didn’t want to worry too much, but I did. I wondered whether I was supposed to run the startup, but like a woman and a mother, I had to build strong family roots. Luckily, my spouse and family were really supportive and never judged me,” Hendriadi said.

In 2017, she attended the grand opening of co-working startup GoWork, where she met the company’s co-founders, Richard Lim and Donny Tandianus. Hendriadi reconnected with Lim, who was an old friend. The three of them quickly realized that they shared the same goals: to build Indonesia’s largest co-working space. It wasn’t long before the two were exploring opportunities for a partnership.

”When I started Rework, I did not see how big it could become until I dove into the business. I finally decided that I had to find a partner, because I couldn’t do it all by myself. After we shared some discussions and our visions to empower a lot of companies and to become a dominant player, we joined forces in early 2018,” Hendriadi said.

Hendriadi’s Rework along with Lim and Tandianus’ GoWork merged into a new company called Go-Rework, which initially had five locations with a total footprint of 3,500 square meters in Jakarta. The company was later rebranded as GoWork in mid-2018 for marketing reasons.

In October 2018, Go-Rework closed its Series A round and raised USD 9.9 million from Gobi Partners and The Paradise Group, with participation from Mahanusa Capital and 500 Startups’ second Durians fund. GoWork trippled its footprint by 2019, according to CFO Richard Lim.

Today, GoWork operates 18 branches covering over 35,000 square meters, with most of them in the capital and one branch in Bali. The company also announced plans to launch new locations in Surabaya and several cities in Indonesia by mid-2020, expanding its footprint to 65,000 square meters. GoWork only operates in Indonesia and has no plans for international expansion.

According to Hendriadi, GoWork’s locations maintain a high occupancy rate, typically in the range of 90–100%.

To become a dominant player in Indonesia, Hendriadi, Lim, and Tandianus set out a strategy focusing on premium customers who are willing to pay GoWork’s higher subscription rates. Hence, they operate GoWork in places like shopping malls or office buildings, which are easily reachable using public transportation. “Almost 70% of members use more than one location” Hendriadi said. She also claims that customers “can gain more credibility by working in the premium co-working spaces of GoWork.”

“There are a lot of co-working spaces in Indonesia, such as CoHive or Outpost, but there are few players targeting the premium class, which we think is a potentially huge market. By targeting this segment, we are able to get more clients, not only from startup companies, but also from traditional and multinational companies,” Hendriadi said.

Competition mounted quickly. In 2017, WeWork acquired Spacemob, a Singapore-based co-working space, and entered Indonesia by setting up a branch in Jakarta in the third quarter of 2018. Soon after, WeWork opened six locations in the Indonesian capital.

A lesson learned from WeWork: Monetization is key to long-term success
Although GoWork and WeWork have both positioned themselves as premium co-working spaces, Hendriadi claims that GoWork has become profitable in mid-2019. However, she declined to disclose more details. It has 5,000 customers, including employees from companies and freelancers. Monthly fees run at USD 150–200, depending on the services required.

All of GoWork’s co-founders have strong and close relationships with property developers, Hendriadi said. This helps the company seek out spaces that serve their purposes.

“We discuss how GoWork can increase visitor traffic to shopping malls or other properties run by these developers. When developers see our concept and the traffic that comes with each of our locations, they mostly want to secure a partnership and sometimes even invest in GoWork,” she said. So far, the firm counts among its investors the likes of Sinar Mas Land, Indonesia Paradise Property, Agung Podomoro Land, Lippo Group, and MNC Land.

Currently, GoWork has three main focuses: providing flexible co-working spaces with attractive interiors to engage clients; organizing events or workshops, where members can engage with each other; and building user engagement through mobile apps.

GoWork’s clients include big companies and mature startups, such as state-owned pawnbroker PT Pegadaian, Gojek, and Oyo.

“We are making ‘sustainability’ our priority. If we look at the startup landscape, most companies focus a lot on growth and sometimes they burn money. We don’t believe that it’s necessary,” Hendriadi said.

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This article first appeared on KrASIA. It’s republished here as part of our partnership.

Running Startups Without External Funding

Funding is an essential and integral part of startup operations. Without funding, it is very likely for a startup to lose before competing.

If it says so, then is it possible for a startup to operate without funding? The answer is probably. Fresh funds are obviously substantial for just daily operations or “burn-money” for promotion.

The truth is, startups can do without funding. This is so far the most relevant option for revenue-based rather than growth-based startups. The following are a few steps for those consider running a startup without funding.

Fixed financial planning from an early stage

With this option, financial planning should be fixed from the very beginning. Without funding, startups must have a detailed calculation of whether the revenue earned from consumers will be greater than the cost spent to acquire consumers.

It’s not only for the early startups but also for mature businesses. Moreover, it is important to be aware of the remaining cash. Drastic steps must be taken when there is only enough cash available for operations in the next six months.

Achieve Product-Market Fit

Startups need parameters to find out whether consumers really want to spend on their products or services. It is important for us to know the product can be the best solution for its users.

The problem is that there are no truly scientific parameters for finding product-market fit. But there are three things that can at least be used as indicators, namely product use, customer retention, and sales activities.

There is no such thing as another metric, it’s only profit

Having a product that is widely discussed by the public is certainly good news. But high traffic, positive engagement, can’t possibly become the right substitute for mature sales and marketing strategies.

Such metrics are often become the early startups killer. They are fixated on pursuing something that doesn’t really impact sales or user acquisitions. Another thing to avoid is investing their money and time and resulting in sales and marketing strategy that won’t last long.

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Original article is in Indonesian, translated by Kristin Siagian

Andi Taufan Believes Perseverance Will Eventually Pay Off

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.

As the sole founder of Amartha, Andi Taufan Garuda Putra has poured blood, sweat, and tears in building the company. With the story of being left by co-founders, the dilemma of choosing study over its own company. It’s all lead to the current situation where the peer-to-peer lending platform has delivered Rp1.25 trillion successful loans to over 200 thousand micro-entrepreneurs in the rural area.

He began the journey with a dream to enable financial inclusion throughout Indonesia. It’s a challenging one, considering the loan business is full of loophole and fraud potential. However, with perseverance as the foundation, he works his way up to the point where micro-businesses can contribute more to Indonesia’s economy.

In fact, he was recently appointed as one of the presidential expert staff by Jokowi. It’s definitely creating more pile of work on his desk. However, he’s eager to accept the challenge, it’s because he believes this country is moving towards a better economy and it’ll be incredibly great to be part of the change.

Let’s hear more of Andi Taufan Garuda Putra’s story through the excerpt from his interview with DailySocial’s team.

To begin with, you are one with an academic background in business. What’s your first thought on starting Amartha? What encouraged you to create such a thing with social impact?

I was getting my business degree without any aspirations to become an entrepreneur. My parents are struggling with their professional career, so I was just planning to follow their path. I was also planning to get my master’s degree and build a professional career worth living. Once I become successful, I would spare some for those less fortunate people. I used to have a simple definition of success, it’s when I turn 50 and have nothing to worry about on my plate.

After graduating from college, I was working at IBM for two years as a business consultant. My job is basically involving palm oil companies to implement the IT system in rural areas. While circling around the less-urban spots, I found out a significant gap between the rural and urban areas, such as Jakarta. It encourages me to make a move, how to contribute more to this issue. In my exploration days, I decided to create something more targeted. Instead of helping conglomerates bulking up their organizations, I need to make something more impactful for small businesses to grow.

It was in the early ’00s, nobody thought of fintech or application platform. After digging into some ideas, I finally settled with microfinance. It has a clear view, once you inject the first capital, cashflow will work out, it also comes with a significant increase in income. It also creates a multiplayer effect in the family, aside from growing business, their children can grow along and have a proper education.

You started Amartha in a cooperative form. Can you spare me the detail on your journey in building the leading peer-to-peer lending platform?

One afternoon, I was visiting a rural area in Bogor named Ciseeng. While exploring the village, I met some people and talked about the issues that often come up in the area. Most of them who stayed at home are women, their husbands were at someplace working informal jobs. As the head of the household didn’t earn much, the wives have to work part-time to improve the family’s welfare.

Based on this phenomenon, I thought they need some additional support. I started to provide small loans, starts from 500 thousand for 100 people in the first year. Talking about productivity, they take the loan seriously and use it for something useful, such as sewing machines and many more. Most of them are responsible enough to return the money on time. We grew by providing a thousand people the next year.

After five years serving over 7000 people in the rural, we’ve found the business quite challenging. At the end of the day, micro-loan has become more than just money, it is a hope for them. They started to make plans for the business and the family, and expect for more loans. With some bad credits and stuff, we were so close to run out of money and the “Amartha went bankrupt?” question has been thrown almost at every corner. It’s just hard, even for me too.

I then discovered that in this internet era, microfinance alone was not enough. We then come up with an idea to gain money from the public, such thing called marketplace peer-to-peer lending. With high-quality partners and the impactful loans, I had my pitch to the seed investors [BEENEXT and MidPlaza]. They turned out to love the idea and through ups and downs, Amartha finally launched its online platform in 2016.

The momentum is there, and more peer-to-peer lending platforms are to launch. Fintech industry is getting alive than ever. We also advised OJK to issue the regulations for the newborn p2p lending industry. Amartha then becomes one of the first batch p2p lending platforms to acquire the license from OJK in early 2019.

Amartha's current team — Amartha’s current team

Talking about the crucial season, how did you cope with the situation and rise up?

It was around the year 2014-2015. People have turned their backs on Amartha, I, too, have doubt in surviving this company. I’ve thought about something new, and the good news from Harvard arrived. In the same year, investors are coming to the Amartha-near-falling-town.

It’s a dilemma, whether to take the school or take care of the company. I finally talked to the investors and they decided to let me continue with my study, under one condition, the platform must be launched as soon. It did happen in 2016. I was working remotely in the US with lots of help from Aria and the developer team. It’s a blessing to have a supportive team and a positive environment around you.

Being a sole founder is a different challenge for me. In 2009, I used to have partners, until one by one left because of the current situation back then. I tried again in 2014 with some partners before eventually two were left and the last one departed with another priority. I then realized that we have co-founders for every stage of Amartha, it is indeed important. In fact, today’s C-levels are very critical to help us moving to the next stage.

What is the next stage for Amartha?

It is when we go beyond peer-to-peer lending. We’ve been very good at providing micro-loan for women in rural areas. Stay true to our mission to deliver equal welfare for people in the last pyramid. If we’re to define the welfare it would be to reduce their cost of living, provide them with affordable products, therefore, they can spare money for savings, and start investing. How Amartha can evolve beyond p2p lending? It’s not only about supporting the initial capital but also to provide other products that can improve the quality of their lives.

How can you make sure the company stays true to the commitment?

The key is to embrace the problem. As the loan business, there are always people with payment past the due date, a loophole in regulations, potential for fraud. If we’re not to embrace, we’ll never improve. What I learned until now the employee has reached 2500, is how to build team with a mission. Their spirit should be aligned with the company’s overall mission. It’s to plant a sense of belonging in each employee. Once done, they can start to explore and move towards the goal. It’s quite challenging but worth fighting for.

Taufan as the first speaker at #SelasaStartup

As one of the first-batch peer-to-peer lending platforms in Indonesia, who/what is your role model for Amartha?

I was looking up to the US and Europe markets. They already have unicorn LendingClub in the US, and Europe market with its Funding Circle and Prosper. I’ve never seen one in Asia. Therefore, with a different customer base, I worked with what we have. As most of the Indonesian population is in the low-end pyramid, Amartha created a business model targeting mass-market and high-quality borrowers.

In the p2p lending landscape, do you have any issue with banking or any other departments towards financial inclusion?

Since the beginning, we have a clear division of roles. Everything we’ve done will not happen without banking infrastructure. On the other hand, banking is not likely to serve this segment, it’ll cost them a grand. Amartha knows the way to serve them and vice versa. This is all about trust issues and we’re fancy collaboration over competition.

Since the trend emerged in 2016 and more players arise in 2017. In 2018, the illegal issue comes up, and even though it’s not us, we’re still affected. OJK is said to take care of the issues this year and association is doing its homework. I see the future will be filled with collaboration, not only funding with banking but something more solid and intense. Also, there will be new ones offering more sophisticated products to run financial inclusion. And I’m always positive with the new founders, because that is what we need, more aggressive and positive people.

In over 10 years, you have poured blood, sweat, and tears into this company. Have you ever thought of creating something new?

It’s still a long way to go for me to get there. Amartha is still in the growth stage, it’s also a different business scale with Google or others. Especially with my recent appointment as the presidential expert staff. I currently have a lot on my plate these days.

Startup players might have known to have “innocent” political views, but you’ve changed it. What makes you so eager to achieve the challenge?

We have a president who is sincere and I’m more than happy to support him. We had a discussion on Indonesia’s small businesses. He wants to make a change, for bureaucracy’s engine can move faster towards future trends. A mandate for Indonesia to be the world’s top 4 of the country with economic power. This is to be built with positive energy and optimistic people. I, along with the other staff, believe that this is a small step to create the confidence to bring Indonesia to the next level.

Taufan as one of the presidential expert staff

With the current framework thinking in startup companies, which is fast. Do you happen to experience a clash of culture with the bureaucracy?

It is our duty as the presidential expert staff to provide innovative thoughts and breakthroughs as the president move bureaucracy’s trains with technology and digital approach. First look at the goal, I have yet to face the clash of anything. It’s a good thing that I still get the chance to work in Amartha, therefore, I can balance the startup with bureaucracy stuff for now. Let’s see what’ll happen six months from now.

Looking back at where you start and how it turns out today, what can you say to the early entrepreneurs facing near-failure situations like yourself back then?

If I were to say something, it would be to stay true to your long term goal, because perseverance will eventually pay off. For those who just started, it’s not about the people, or the money, or the technology. It’s when you find the one thing to focus on and let no distractions come in the middle. Failure is part of the journey. We fail when we stop.

The Rise of Sharia Market, Startups Need to Buckle-up

Sharia economy becomes a topic in Presidential election debate last April. Aside from the representatives’ answers, to bring the topic is one thing, it marks the sharia economy and its derivatives are already taken place in the country’s economy.

Today, after Joko Widodo and Ma’ruf Amin officially Indonesia’s President and Vice President, sharia economy is emerging. It’s represented by some digital companies which counting their luck in this Islamic-based economy.

First indicator is seen as Tokopedia and Shopee visited the office of Vice President Ma’ruf Amin last November. Tokopedia‘s Chief Commissioner Agus Martowardojo and Vice-Chairman Leontinus Alpha Edison arrived first. After two weeks, Shopee also made a similar move by taking its top officials to meet Ma’ruf as the Chairperson of the Indonesian Ulema Council (MUI) and an important figure in the local Islamic financial industry.

The second visit of the e-commerce giant is said to be a new round of their competition in the Islamic market. Tokopedia with the Tokopedia Salam feature, while Shopee with Shopee Barokah.

Another indicator is the entrance of some conventional investors into sharia-based businesses. It can be traced from the investment of Golden Gate Ventures, Agaeti Ventures, and RHL Ventures to Alami, a local sharia-based fintech company. The emerging new startups that focus on providing sharia products or those expanding its coverage into the sharia market showed a high demand for sharia market in Indonesia, such as Qazwa, Waqara, Investree, LinkAja, and Akulaku.

The keen interest of digital companies to enter the sharia market points out at one thing: a great potential ready to be executed. It is clearly not just pocket-sized money, considering Indonesia as a country with the largest Muslim population in the world.

The State of Global Islamic Economy Report 2019/2020 reported Indonesia’s score at 49, placed at 5th position out of 73 countries. The score was determined from several sectors such as Islamic finance, halal food, Muslim-friendly tourism, fashion, media & recreation, also pharmacy & cosmetics. Halal food and Islamic finance are the two biggest sectors contributing to this assessment.

The report shows Indonesia’s overall sharia market has developed quite significantly, from 10th place last year to the 5th place this year. The biggest factor is said to be the country’s blueprint of Islamic economy development and fresh initiatives such as Halal Park which was launched a few months ago.

Of the six sectors in the report, Indonesia has positioned in the top 10 in 3 sectors, namely 5th in the Islamic financial sector, 4th in Muslim-friendly tourism destinations, and 3rd in the fashion sector. Halal or sharia-based product consumption in Indonesia is the largest in almost every sector, especially for halal food. Indonesia is rated as a country with halal food consumption value at US$ 173 billion (Rp2,400 trillion) or the largest in the entire world.

In terms of Islamic financial institutions, Indonesia is likely to be on the right path. Indonesia’s sharia financial asset is projected at the 7th rank with valuation at US$ 86 billion or Rp1,200 trillion. The number is likely to grow along with the implementation of the Sharia Economic Master Plan 2019-2024.

The Players

Some of Indonesia’s startup players have penetrated the Islamic market and halal products. Primarily, they are categorized in two; those providing Muslims products since the beginning and those who expand their services.

However, the number appeared to be not big enough. Some of the players are Ammana, Alami, Syariah Funds, Qazwa, Duha Syariah, Syarfi, Bsalam, GoHalalGo, Waqara, Umra.id, Hijup, and Hijabenka. It’s to be noticed that almost all of these names are divided only into two types of services: Sharia fintech and Umrah marketplace. As for investors, the Financial Services Authority (OJK) noted per October 2019, there were at least 6 registered venture capital companies operating. Ma’ruf himself has claimed 31 fintech sharia in Indonesia, are a bigger number than any other country.

On the other hand, there are some conventional startups entering the sharia business. A few names, such as Bukalapak, Tokopedia, Shopee, LinkAja, and Investree. As an example, Tokopedia through its Tokopedia Salam. The expansion was quite aggressive. Through this feature, they are transformed into a marketplace for Umrah travel agent services to accommodate Muslims. In addition, Tokopedia claims to provide over 21 million halal products on their platforms.

Opportunity’s Wide Open

Referring to the [still] small numbers of Sharia business players, this type of economic clearly has a large opportunity to grow. Based on the State of Global Islamic Economy report above, Indonesia has the opportunity to expand the sharia business in various sectors.

In terms of halal products, for example, there are some sub-sectors to be focused on by local businesses such as halal-certified e-commerce products, halal-concept retail, or halal food technology. Remember, global’s money circulation in the halal food business is to reach US$ 2 trillion or around 28,000 trillion Rupiah by 2024. Instead of listed as the top 10 halal food producers, Indonesia is said to be the largest market in the world.

The same opportunities count in the halal tourism sector, Islamic finance, Islamic fashion, and media & recreation. Specifically, startups can pay more attention at the tourism and finance sectors. Also, the government has been facilitated tourism through the halal tourist area. Meanwhile, sharia-based finance is considered an alternative way of fueling the country’s economic growth. The sharia-based finance sector’s contribution to the national economy is still at 8.73 percent. It determines a greater opportunity to grow and transform into an alternative engine driving economic growth.

Before moving further, Indonesia still had quite a large amount of homework. STIE SEBI’a sharia economic observer, Azis Setiawan, said the blueprint of the sharia economy and halal industry made by the government has yet to meet its objectives.

“I think the current blueprint still needs sharpening up and to translate it is the relevant government institutions’ job,” Setiawan said to DailySocial.

In fact, digital companies engaged in sharia-based economics, said Setiawan, is yet to penetrate the overall market potential in Indonesia. The lack of public knowledge of sharia products and halal industries is one reason, but he also highlighted the fact that Indonesia is a country with the largest Muslim population in the world.

“Let’s take the example of halal tourism. There are matters like Sharia homestay, halal food, and many others. The perspective must be taken globally because people come from various countries,” he added.

Setiawan believes the government is capable to make the sharia economy an alternative engine to Indonesia’s economic growth. However, he suggested that the government as a full policy-holder must be faster at implementing plans and be responsive to the existing developments like Malaysia if we’re not to be further left behind.

“We might have been left behind with Malaysia for about a decade or two for this Islamic economy,” he concluded.

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Original article is in Indonesian, translated by Kristin Siagian

LinkAja Introduces New CFO and Plans for Series B Funding in 2020

The e-money platform LinkAja aims for doubling its business growth by next year. As the CEO, Danu Wicaksana said, the company has now acquired 40 million registered users per November 2019.

“We’ve seen the e-money industry is getting crowded next year. We’ll be more expansive, especially with the current achievement,” he said at the launching of LinkAja Outlook 2020, Tue (2/17).

In order to accelerate expansion, Wicaksana added, the company is to add more talents, from only 80 people in the beginning until now become 400 people on board, 250 of them are engineers.

In terms of service, LinkAja’s Chief Marketing Officer, Edward Kilian said there will be more “use case” development in 2020, including features/services for consumers and merchants. The latest one to be launched is LinkAja Syariah.

“The financial service must be around the wealth, loan, and protection product. Our use case development will be around that too and focused on transportation. For us, building a complete ecosystem is very important,” Kilian said.

LinkAja is to increase the number of cash-in corners which is currently reached 1 million. For the local ecosystem, the company will enter the 35 clusters in micro and ultra micro segment.

Post the commercial as an e-payment product in February, LinkAja is moving faster with the maneuver as a solution platform, not just an option.

Since its debut, LinkAja is targeting “mass and aspirant” market which is defined as the underbanked and unbanked segment looking at e-money as a solution for daily needs.

Some initiative use case as LinkAja’s main target is products related to daily usage, such as transportation, bill payment, and gas shopping.

In terms of product, LinkAja has secured 200 payment transactions for telco products, 400 bill payment transactions, 3,000 transactions for donation and religious building, 250 thousand offline merchants, 380 e-commerce partners, and also an option at 2,500 gas station.

In the transportation line, LinkAja is now available in Gojek, Grab, Bluebird, Commuter Line, Damri, KAI Access, soon to be available in MRT Jakarta.

Based on Fintech Report 2019, Gopay has been the most used digital wallet with 83.3%, followed by Ovo (81.4%), DANA (68.2%), and LinkAja (53%).

The new CFO and fundraising plan

In the Outlook 2020 disclosure, Ikhsan Ramdan as the new Chief Financial Officer has ensured that Series B Funding is to be held next year.

“We’re still in the growth stage, and need funding to expand. Direction from our shareholder is to be open with private partners. It can be through partnership or capital injection,” he added.

Mentioning the strategy to burn money which also been adopted by some leading players, he emphasized on the company’s strategy that is going to be focused on the vision and mission, not the valuation for becoming unicorn,” he said.

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Original article is in Indonesian, translated by Kristin Siagian

Alpha JWC Ventures Bags 1.7 Trillion Rupiah Through Its Second Fundraising

Alpha JWC Ventures has announced to close its second fundraising round at $123 million or around 1.7 trillion Rupiah. Since starting the second round in mid-2018, Fund 2 had been closed by “oversubscribed” – the number of investors who have a keen interest to join is exceeding the available slots. In addition, almost all investors in Fund 1 are rejoined this round.

The money collected from Fund 2 has been invested since the end of 2018 to 14 startups. One of the biggest investments has been Kopi Kenangan in November 2018 at $8 million or around 121 billion Rupiah. To date, they already listed 33 startups in their portfolio.

“To date, our team’s support in the journey and its development has been an important factor of our startup portfolio’s succession, and our focus lays on the business fundamentals of each company. We always remind all founders and startup teams the importance of proper unit economics calculations and financial accountability from the first day they joined Alpha JWC. We believe this approach is essential for the long-term sustainability of startups,” Alpha JWC Ventures’ Co-Founder & Managing Partner, Chandra Tjan explained.

In portfolio management, the company managed to use a hands-on approach in various business lines, from recruitment, marketing, and legal support.

“We also avoid investing in similar companies or any competitors to our previous portfolios. Our principle is to support our startups directly and intensively which means we have to choose the right founders and continue to help them throughout the startup journey,” Alpha JWC Ventures’ Co-Founder & Managing Partner, Jefrey Joe added.

To date, Alpha JWC has 20 team members. This year they added three new partners, namely Alan Hellawell (former CSO of SEA Group), Erika Go (former Principal of Alpha JWC), and Eko Kurniadi (former VP of Investment Creador). In addition, they have now launched a permanent office in Singapore to be able to reach more startups in Southeast Asia.

“We’re actively eyeing Vietnam’s digital industry for funding opportunities. As one of the fastest growing economies in the world, we believe Vietnam is the next largest market in Southeast Asia. Furthermore, we’ve invested in three companies in Vietnam and currently exploring some other startups,” Chandra added.

In its debut in 2016, Alpha JWC Ventures has launched Fund 1 worth $50 million or around 700 billion Rupiah. The funds were channeled to 23 startups in Southeast Asia, mostly in Indonesia. In less than 4 years, Fund 1 is claimed to have grown to 3.2x in Net Asset Value (NAV). Alpha JWC has also successfully made two exits, the Spacemob coworking space network (acquisition by WeWork in 2017) and the DealStreetAsia business media (acquisition by Nikkei in 2019).

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Original article is in Indonesian, translated by Kristin Siagian

Gojek Reportedly Nearing a Deal to Acquire 5% of Blue Bird Worth of 420 Billion Rupiah

Gojek is to acquire 5% shares of PT Blue Bird Tbk (Blue Bird). They’re to spend about $30 million or 420 billion Rupiah, it goes higher considering the company’s market capitalization in the closing stock exchange per Monday (12/16) at 6.8 trillion Rupiah.

The news was first published by Bloomberg. According to a source, the deal was built on the previous partnership, since 2016. As publicly known, the taxi operator Blue Bird is also available to order via Gojek application, through the Go-Blue Bird feature.

The company’s move is believed to be in line with the business strategy to continue leading the market amid intense competition with its rival, Grab. Gojek has also applied the strategic partnerships with local transportation companies in Singapore. In November 2019 they announced a strategic partnership with Trans-Cab Services, to accommodate orders for more than 3000 taxi fleets through the application. This service is said to be effective per December 2019.

On the other hand, Gojek is keeping the door for new participants open to the Series F funding round. Targeting $3 billion, it is reported to have reached $2 billion and to be closed in January 2020. Gojek’s Commissioner, Boy Thohir also mentioned the company’s plan to run IPO.

Having the ambition to be a super app, Gojek keeps expanding its services. It is through the acquisition of some digital startups. The latest one is Moka’s point of sales service, in the finalizing stage acquisition worth of 1.6 trillion Rupiah.

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Original article is in Indonesian, translated by Kristin Siagian

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BRI Introduces “Ceria”, An Application for Virtual Credit Card Services

BRI has launched BRI Ceria, a paylater service or virtual credit card targeting underbanked debtors. The application is now available to download in the Android version.

It’s further detailed in the release that BRI Ceria is to provide loans start from Rp500 thousand up to Rp20 million with a tenor of 1-12 months. The interest rate is 1.42% per month or 17.04% per year. If it’s already past the due date, customers may incur a late payment fee for 3% of the total bill or up to Rp150 thousand.

This feature is limited only for BRI customers. It’s a strategy to make credit scoring and prevent fraud.

Another requirement is for the customers should at least 21-50 years old, with minimum income of Rp3 million, and have Taxpayer Identification Number (NPWP).

BRI claimed, once the data submitted, the verification process will only take 30 minutes. Once approved, the credit limit is available to shop at online merchants. This concept is similar to the ones issued by Kredivo and Akulaku.

In the initial stage, BRI Ceria has available to use for payment on Tokopedia, purchase flight tickets on the Panorama JTB site, and the electronic products e-commerce Dinomarket.

Quoted from Kontan, BRI’s Director of Digital, IT, and Operational, Indra Utoyo explained. Ceria is BRI’s paylater with a limit of up to Rp20 million targeting ultra micro customers.

“The new product Ceria is to be launched soon, BRI’s paylater up to Rp20 million limit for ultra micro,” he said.

Prior to this, BRI through its subsidiary, BRI Agro, has launched a similar application named Pinang.

The development of BRIBOX

Next year, the company will continue the digital initiation through BRIBOX, it’s a modernization of work unit network infrastructure throughout Indonesia, modernization of cloud-based data centers, and implementation of core banking modernization.

The initiation is to absorb the largest allocation for IT-related capital expenditure. Indra also revealed the bank has prepared Rp4.2 trillion for next year’s budget, increased by 13.5% from this year’s budget.

“The main effect of modernization is to be eager to face the growth and innovation of digital services that are flexible, scalable, secure, and reliable.”

The digital transaction has now dominated the entire transaction at BRI. About 80% [of the transactions] come from non-branches. Moreover, the company plans to shift the employees’ role in branch offices as customers’ advisors and counselors.

“Closing branch offices is a normal consequence, but its role will later be rethought. Teller’s current role is now being repurposed because there will be a lot of self-service and assisted service in the future,” Indra said.

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Travelio Announces Samsung Venture as Part of Its Series B Funding

Travelio prop-tech startup today (12/12) has announced new participant for its series B round. The one joining the board of investors is Samsung Venture Investment Corporation. It marks the second investor in this investment – the previous one is Pavilion Capital.

On the first announcement of series B round on mid-November 2019, Travelio has secured capital funds of 253.6 billion Rupiah. This round was led by Pavilion Capital and Gobi Partners. In addition, investors from the previous round also participated, namely Vynn Capital, Insignia Ventures Partners, IndoGen Capital, and PT Surya Semesta Internusa Tbk.

In Indonesia, Travelio is Samsung Venture’s second portfolio. They’re previously involved in Gojek’s series E round in 2018.

Through this announcement, Samsung Venture also mentioned the plan to make more aggressive maneuvers investing in Southeast Asia for more years to come.

“We’re very lucky to have Samsung as one of the shareholders. The history and its capacity will help us manage to be globally recognized and have a good reputation,” Travelio’s Co-Founder & CEO, Hendry Rusli said.

It’s also said that the additional capital from Samsung Venture will be focused to accelerate the company’s growth in 2020. It includes expanding integration and partnership with networks of conglomerates, technology, and electronics ecosystem in Samsung.

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Original article is in Indonesian, translated by Kristin Siagian

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