Indonesia's future is mobile

Monday, 28 November 2016  @Business School

Digital technology using mobile platforms is transforming the Indonesian economy, a UNSW forum in Jakarta has heard.

“We are a mobile first country,” said Shinta Dhanuwardoyo, Founder & CEO of Bubu.com. “Technology is solving a lot of Indonesia’s pressing problems. We can really see the growth on the ecommerce side.”

“Companies like Tokopedia, (online marketplace) Bukalapak actually create other jobs, create SME’s. We know 90 per cent of Indonesia’s economy comes from SMEs, so that changes a lot,” she said.

Many Indonesians only access the internet on a smartphone, with mobile internet use among the highest in Asia. There are 300m active mobile SIMs, more than one per person.

The UNSW Business School event, hosted by the Australian Embassy in Jakarta, heard from a panel of Indonesia’s leading businesspeople, as well as new names in the digital technology scene.

Professor Nick Wailes, Associate Dean Digital and Innovation at the Business School, said: “An understanding of emerging markets will position Indonesia’s new generation of digital entrepreneurs and startups to succeed not only in their local market but in the rapidly growing emerging markets in the ASEAN region.”

The BusinessThink | Indonesia panel included Noni Purnomo, President Director, Blue Bird Group; Moses Lo, CEO/Founder, Xendit; Norman Sasono, Chief Innovation Officer, Bizzy; Karina Akib, Strategic Partner Manager, Google; and Shinta Dhanuwardoyo, with the discussion moderated by Nick Wailes.

The panellists said that entrepreneurship was thriving in Indonesia, but it faced challenges: including finding angel investors to back new start-ups, as well as a lack of skilled developers who are also versatile system architects to design new applications.

Noni Punomo, who heads Indonesia’s biggest taxi operator and transport company, recently signed a deal with ride-sharing app company Go-Jek to help customers book Bluebird taxis.

“Our aim is to be able to give our customers ease in getting our services – so we provide multi-channels to get our taxis. We don’t see (companies like Go-Jek) as disrupters. We learned how to use that technology to make our operations more efficient – we are adapting to new technologies,” she said.

Dr Justin Lee, Deputy Head of Mission to Indonesia, said: “It is remarkable the change that has occurred. When you have got the challenges that a large mega-city like Jakarta has around infrastructure and movement and population density, technology really can provide many solutions.”

Earlier this year, the Indonesian Government launched an ecommerce roadmap, to address pressing issues for start-ups including logistics, tax incentives, human resources, consumer protection, communication infrastructure and education.

“When we talk to the players, they said it should be answering what we need, but the key is for the Government to execute it,” said Shinta Dhanuwardoyo, who has been involved in the start-up scene for 20 years and now, mentors emerging players. “Let’s see (what happens). The government is much more active right now.”

Moses Lo, an alumnus of UNSW, said when he thought about setting up Xendit in Indonesia, he looked first to understand the local market. “Instead of coming in with an idea we came in and talked to people and said “How can we help? What are your pains? We heard that payments in this country were very difficult.” So he built a payment platform that supports other Indonesian mobile business.

Karina Akib, another UNSW alumna, said Indonesia was seeing the early stage of the evolution of the digital economy, with plenty of venture capital flooding into the market for customer-focused business. Larger start-ups are now working on ways to monetise their customer base – and keeping their businesses sustainable.

She also said: “digital is a great place for women to work... the connectivity, the flexibility of working from home, and the great cultures that are built in digital start-ups or larger companies like Google. Maybe Indonesia can be part of changing that because there are many women leaders here.”

Norman Sasono from Bizzy, Indonesia’s first B2B ecommerce platform, said it was very challenging to get good engineers who can code.

“Most universities are not teaching technologies that are not up to date,” he said. “When students graduate they are not really ready to do the job. For early stage start-ups like ours, we cannot really afford to hire first grade, we have to train them and nurture them.”

Twenty UNSW Business School students are spending two weeks in Indonesia as part of the global business practicum, funded through the Australian Government’s New Colombo Plan, that gives Australian students study and work experience in the Indo Pacific region.

Listen to the podcast of the BusinessThink | Indonesia 2016 event.

Media contact: Julian Lorkin: +61 2 9385 9887 | +61 405 805 365 | j.lorkin@unsw.edu.au

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