Indonesian minister urges investors to keep faith in startup ecosystem
Minister Meutya Hafid makes this pitch amid sluggish funding for such firms in the country
Lionel Lim
[JAKARTA] Indonesia, South-east Asia’s largest economy, has thousands of startups, ranging from those that provide ride-hailing services to those in e-commerce, financial inclusion and even agriculture.
But the sentiment regarding the country’s startups has arguably soured in recent months, owing to a series of scandals – with the most notable in recent times being the one involving eFishery, an agritech unicorn that was backed by investors such as Japan’s SoftBank Group and Singapore’s Temasek Holdings.
Yet, in a speech on Wednesday (Oct 22) in the country’s capital Jakarta, Indonesia’s Minister of Communication and Digital Affairs Meutya Hafid made a pitch to investors to keep their faith with Indonesian startups.
Meutya pointed out in her keynote speech at the Tech in Asia conference, co-organised by The Business Times, that the country’s main stock-market benchmark – the Jakarta Composite Index – has risen by 26 per cent since March this year, and that its tech sector has also grown by more than 33 per cent in the same period.
“This is a clear signal that technology and our digital ecosystem is thriving. On top of this, our digital economy had about US$90 million in GMV (gross merchandise value) as at 2024, which is projected to reach as much as US$360 billion by 2030,” she said, adding that the increase is driven by the rapid adoption of artificial intelligence across all sectors in the country.
Meutya also announced initiatives from her ministry that are designed to serve as a platform to connect founders, innovators and investors. She noted that her ministry is working on a digital startup index that is expected to be launched next year. The index will “map, measure and support” the ecosystem’s potential in Asia, she added.
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Her speech on Wednesday comes against the backdrop of sluggish funding for Indonesia’s startups. Besides the series of scandals involving such firms, the end of the low-interest environment from early 2022 also negatively affected funding for startups as higher borrowing costs reduced investors’ appetite for risks.
Indonesia has more than 29,000 startups according to Tracxn, a market intelligence firm. These firms create jobs both directly and indirectly in the Indonesian economy. Some such as GoTo and J&T Express are also no longer considered startups, having grown in both company size and valuation.
The Business Times Global
Also at the conference on Wednesday, The Business Times editor Chen Huifen announced the launch of The Business Times Global (BTG), a new regional news product under Singapore Press Holdings that aims to help readers “unpack Asia”.
BTG aims to be the trusted voice and go-to resource for decision-makers, noted Chen. “We aim to bring you essential news about trends and opportunities in the region and, in turn, build bridges,” she said.
The platform differentiates itself by covering the region and providing in-depth analysis from a uniquely South-east Asian perspective, but with a global audience in mind. The new offering aims to transform complex regional dynamics into actionable business intelligence for global decision-makers, especially as businesses look for alternatives in an increasingly fragmented world.
For more information on BTG, go to bt.global.
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