Indonesia’s ever-growing startup ecosystem keeps on drawing attention globally. Several startup companies received investment from foreign venture capitalist as well as lenders. According to the Daily Social report, startups in Indonesia have received at least 51 investments by 2018, including 20 recorded seed funding transactions, 14 examples of Series A funding, and 11 Series B funding cases. Excluding unicorns, Indonesian startups received a total investment of Rp 4 trillion, or US$ 274 million. Meanwhile, in 2019, Indonesian startups received 59 recorded investment transactions. E-commerce, software as a service (SaaS or software as a service) and fintech receive the largest funding while artificial intelligence (AI) based services support these platforms and others by creating chatbots for them.
According to the Ministry of Cooperation and MSMEs, in 2017, more than 60 per cent of Indonesian MSMEs were online. These digital ecosystems require robust digital infrastructure to support high-speed broadband wireless access to the internet. Indonesia, an archipelago of more than 17,000 islands, has seen uneven development of its digital infrastructure because of the challenges posed by its unique geography.
However, as the internet of things (IoT) becomes ubiquitous, mobile technology will become an exponential power multiplier for MSMEs, even beyond the major population centres of Jakarta, Surabaya and Denpasar as 5G networks are built throughout the country. The national Ministry of Communication and Information has committed to rolling out 5G networks over the next three to five years. Therefore, it is evident that MSMEs need proper internet to scale up, and they need assistance in terms of financial matter as well as data utilization for optimum business decision to cultivate better result.
Aligned with Indonesia’s government initiatives in developing digital talent, Grab, the super-app in Southeast Asia is opening applications for a startup acceleration growth program called Grab Ventures Velocity (GVV) Batch 3. It is a flagship scale-up program for startup from Grab Ventures. This year, GVV Batch 3 is back with the theme of “Enabling Micro Entrepreneurs” with two new tracks; Value-Added-Services for restaurant businesses and B2B logistics.
The GVV Batch 3 opening in CoHive Plaza Kuningan was attended by government key figures such as Teten Masduki, Minister of Cooperatives and Small Medium Enterprises, Johnny G. Plate, Minister of Communication and Information, Republic of Indonesia. Both of them were supporting the program which will boost the business of startups that provide digital solutions for small and medium enterprises. CoHive also takes part in this collaboration because it is one of the steps to nurture digital talent and hoping this could also support the government to boost the digital economy in Indonesia.
One of CoHive’s members, TaniHub, an agricultural technology company startup, has been able to access millions of more customers through GrabKios since they joined the Grab Venture Velocity acceleration program. Another way these platforms can contribute to society is by allowing Indonesian entrepreneurs with big dreams to scale their businesses by giving them access to customers and transactional infrastructure. Therefore, a collaboration between all stakeholders such as government, startup accelerator and startup community is something that is of paramount importance.
Startup companies should jump in to help MSMEs in this situation, exemplified by CoHive coworking space. As Indonesia’s largest coworking space company and community platform, CoHive aims to be the most prominent community builder in Indonesia, where they connect and enable startups as well as micro, small and medium enterprises – SMEs (UMKM) to grow their businesses. Currently, CoHive has over 9.500 members working from 37 locations in Jakarta & Tangerang, Medan, Yogyakarta, Bali and Surabaya with a total of approximately 75.000 sqm.