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Jakarta Post

All eyes on startups

Hatchlings: Startup workers share working space at Kejora HQ in the Barito Pacific Building in Jakarta

Tertiani ZB Simanjuntak (The Jakarta Post)
Jakarta
Sun, November 8, 2015

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All eyes on startups Hatchlings: Startup workers share working space at Kejora HQ in the Barito Pacific Building in Jakarta. The government aims to have 10 unicorn startup companies in five years’ time.(JP/Jerry Adiguna) (JP/Jerry Adiguna)

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span class="inline inline-center">Hatchlings: Startup workers share working space at Kejora HQ in the Barito Pacific Building in Jakarta. The government aims to have 10 unicorn startup companies in five years'€™ time.(JP/Jerry Adiguna)

The recent visit of Indonesian government officials and startup founders to Silicon Valley, California, the nursery of world tech startups, was the start of a five-year bid to breed not one, but 10 unicorns.

The magical galloper is used to define a tech company with a valuation topping US$1 billion, based on fundraising.

Communications and Information Minister Rudiantara has set a roadmap for the purpose, providing government support for young tech entrepreneurs.

In 2020, according to the plan, there will be 1,000 tech entrepreneurs, expecting the first two unicorn companies to emerge in 2016.

'€œI am convinced Indonesia will have unicorn companies next year,'€ Rudiantara said while meeting with Saeed Amidy, CEO of US startup accelerator Plug and Play Tech Center at the latter'€™s office in Silicon Valley.

The meeting was set up by Yansen Kamto, CEO of Indonesian startup incubator Kibar Kreasi Indonesia '€” the government'€™s partner in building the ecosystem for tech entrepreneurs.

Yansen expressed the hope that Indonesia and the US could set up a mentor network that would enable startup incubators to learn something from one another and to draw a standard curriculum for startup acceleration.

He said he had personally met with mentors from Techstars, GSVlabs, StartX and Y Combinator and asked for their involvement in the partnerships.

'€œThey all gave positive responses. It'€™s just the start of our approach, hopefully we can make it happen early next year.'€

During the brief visit on Oct. 28 and 29, Rudiantara also met with representatives from venture capital firms known to be involved in the scaling of tech startups and brought along with him four top Indonesian startups.

The four were Nadiem Makarim of motorcycle taxi service Go-jek, Ferry Unardi of travel booking service Traveloka, William Tanuwijaya of online shopping mall Tokopedia and Emirsyah Satar of online department store MatahariMall.

In the coaching program, according to Yansen, the government will hold a series of scouting events looking for 200 potential startups a year and finding candidates to be groomed as unicorns.

'€œThe coaching is essential in optimizing the potential of young Indonesians and to create high-quality, diverse tech startups.'€

Tech startups in Indonesia have been growing quietly in the community of founders and in campuses during the past five years with little involvement from the government until it recently made the digital economy its priority in national economic development, as it aims to become a player, and not only in the Southeast Asia market.

Indonesia already has the biggest potential market in the region for e-commerce startups and tech companies providing digital solutions.

In e-commerce transactions alone, Indonesia booked $12 billion at the end of 2014, a jump from the $8 billion in 2013, according to data from the Indonesian E-commerce Association (idEA). The association predicts the transaction value will double to $24 billion in 2016 as venture capital firms set their eyes on Indonesian e-commerce startups.

To protect the ecosystem, the government will introduce a new set of regulations on taxation and funding in its roadmap.

The roadmap involves eight ministries and state agencies, namely the Communications and Information Ministry, Trade Ministry, Industry Ministry, Finance Ministry, Transportation Ministry, Bank Indonesia, the Investment Coordinating Board and the Creative Economy Agency.

Rudiantara said he had proposed to open the doors to foreign investment in the e-commerce and digital sectors.

Currently e-commerce is included on the country'€™s Negative Investment List, requiring such businesses to be wholly owned by local players.

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