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Satellite cities ripe pickings for tech investment: Study
A study from Katadata shows that satellite cities offer tech start-ups similar opportunities to urban centers.
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Traffic is jammed on Jl. Margonda Raya in Depok, West Java, on March 8, 2018. The satellite city to Jakarta is said to harbor tech investment potential. (Antara)
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atellite cities hold promising opportunities for investors looking to establish and fund tech start-ups, according to a study that finds that smaller cities and subdistricts offer similar market potential and digital infrastructure to urban centers.
The Regional Investment Potential Index in the digital sector, produced by Katadata Insight Center (KIC), shows that, while Jakarta still tops all categories in the index, cities and subdistricts like Bekasi, Bogor, Depok and Cimahi in West Java have adequate infrastructure and a sufficiently tech-savvy population to drive demand for technology.
The index looked at four main categories to access the investment potential, namely economic attractiveness, infrastructure and logistics, digital capacity and financial readiness.
“Physical infrastructure, internet use and access to finance are quite equal across Indonesia,” said KIC research director Mulya Amri during an online press conference hosted by Katadata on Monday. “But population density and logistics services are still concentrated in big cities.
A 2021 study by venture capital firm Alpha JWC Ventures and global consultancy Kearney showed that small cities in Indonesia would become the biggest contributors to the country’s digital economy.
Nonmetropolitan areas were projected to contribute $45 billion in gross merchandise value (GMV) in 2025, a fivefold increase from $9 billion in 2020.
Read also: Move over, Jakarta! Small cities to grow Indonesia's digital economy
