Entering the first decade since its launch in Indonesia, East Ventures Partner Melisa Irene sits down with e27 to discuss the most important milestones that the venture capital (VC) firm has made, especially in the past one year.
The firm was founded in 2009 with the goal to help propel Indonesia forward through the use of technology, and in 2018, it has seen what Irene described as “the accumulation” of all the things they have worked for.
“… We believe that we should begin by building the ecosystem as a supporting infrastructure. When we have managed to successfully build an infrastructure, we are going to enable other businesses to be built upon this existing infrastructure. That way we can make greater impact,” she explains.
Irene gives an example of Tokopedia which started out as an online marketplace that enables small- and medium-sized businesses to build an online presence, supported by features such as cashless payment, which is currently being provided by OVO.
In addition to building an ecosystem, East Ventures had also proven that it is able to grow a business “very fast” by solving “invisible problems” as done by their portfolio company Warung Pintar (a New Retail platform that works with street stalls or warung) and Fore (an on-demand coffee service).
In less than 1.5 years, Warung Pintar has worked with more than 1,000 warungs while Fore has operated 30 outlets in just six months.
“We also want to prove our recent learning that the time it takes for founders to innovate is getting shorter and shorter,” Irene says.
The firm was the investor behind some of the leading tech startups in Indonesia, including unicorns Tokopedia and Traveloka.
It has also seen exits such as the acquisition of O2O e-commerce platform Kudo by Southeast Asian ride-hailing giant Grab in 2017.
What’s trending in Indonesia?
For the future, East Ventures wants to continue on working to realise its vision to help Indonesia; it also aims to continue on seizing new opportunities in the market.
Some of the most exciting themes in the market currently include O2O (online-to-offline and vice versa) and New Retail.
“There will be more online-only services acquiring their customers through offline means; it has started to make sense as online means have begun to get too costly,” Irene points out.
Irene also believes that certain aspects of logistics industry has called for new innovation.
“Players will go beyond last-mile delivery; they will also touch the distribution process as a whole, including from its back-end,” she explains.
Businesses will also continue on building upon the existing infrastructure, which Irene sees as a great news as companies “can now focus on their creativity in innovating a certain industry.”
“For example, with Fore, we don’t build our own e-commerce platform. We also don’t build our own fleet or marketing agency. We simply innovate how people consume coffee by utilising the existing ecosystem, using services such as Moka POS or Go-Food,” she further elaborates.
“From the perspective of big data, this can also be really attractive … It is able to provide feedback to business players on which industry to enter. In the end, we will have a clearer mapping of our whole ecosystem and it will enable us to make progress faster,” she adds.
Another exciting change that is set to happen in 2019 is that many light-asset companies are going to make a move to become more heavy-asset. While a greater prospect for IPO is never guaranteed, Irene sees that these changes will open more opportunities for exit through IPO.
“We need to consider timing, but the door is opened more widely,” she closes.
Image Credit: East Ventures