As one of the most promising countries on economics and technology in Southeast Asia, Indonesia is globally being watched over by investors. In 2008-2010, when the startup community was still growing, only few foreign investors coming in and Japanese venture capital (VC) was dominating. In 2017, US and Chinese VCs are coming to invest in Indonesia.
In a session of Wild Digital Indonesia, foreign VC representatives, like Bluesky Investment Director Ben Dunphy, SBI CEO & Managing Director Ryosuke Hayashi, and OPT SEA COO & Partner Soonhe Kim, discussed about the enthusiasm towards Indonesia.
Indonesia’s huge market size
Out of the many reasons to regard Indonesia as superior over Malaysia and equivalent to Singapore is the huge market size. Proven by the increasing use of smartphone and internet penetration in Indonesia.
“According to current data, consumers in Indonesia and Singapore contributed the most profit in many industries, a proof for the huge market size,” Dunphy said.
Hayashi shares similar opinion, seeing the lack of financial services creates opportunity for startup development in Indonesia.
“The great number of ‘unbanked people’ is an opportunity for startup to develop solution for this problem,” Hayashi added.
Since 2011, Indonesia has started significant change in technology, led by local rising stars such as Tokopedia, GO-JEK, and Bukalapak. The dynamic puts Indonesia as one of the fastest growing economy in Southeast Asia.
“When local startup was non-existence, there is no clear opportunity for investment. Nowadays, many high-potential local startup are rising and attracting foreign investment,” Kim said.
Ready to compete with Chinese VCs
The similarity in market and technology development between Indonesia and China becomes a reason why many foreign investors come and invest more in Indonesia. It does not complicate Bluesky, OPT SEA, and SIB to keep looking for opportunity in potential startup in Indonesia and to compete with Chinese VCs.
“With China VC experience, they will get a head start. However, for Southeast Asia-focussed investor like OPT SEA, it won’t be a problem,” Kim said.
The article Closer Look on Foreign VCs Interest in Indonesia first appeared in DailySocial.
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