BI Boss Encouraged Indonesian Unicorn Startups to ‘Compete’ with Big-Tech Companies

Governor of Bank Indonesia, Perry Warjiyo, said that the rapid flow of digitalization provides an opportunity for Indonesia to create quality and inclusive economic growth. According to him, digital innovation can strengthen the relationship between economic agents, from the smallest to the largest, from individual consumers, SMEs, to large corporations.

The digitalization of the economy and finance opens up the potential for economic and financial inclusion. This condition can narrow the gap in society. “Therefore, innovation in the digital economy and finance needs to be done through the development of startups in various segments,” Perry said.

It includes payment systems, financial services, retail economy, and MSMEs. “The integration of the digital economic and financial business ecosystem in various segments, both from banking, fin-tech, and e-commerce, to national unicorns also needs to be encouraged,” he added during the annual BI event in Jakarta.

This way, he said, competitiveness and national interest in facing the onslaught of business mastery by several global big-tech enterprises could be strengthened. Besides, Perry continued, the availability of public infrastructure for data will be encouraged to ensure openness and equality of access.

This method is done to ease access to data and information for all parties. Ultimately, continuing to prioritize adequate personal data protection could ensure the sustainability of innovation and economic as well as financial inclusion. Meanwhile, Indonesia currently has five unicorns.

Indonesia Has the Most Unicorn Startups in Southeast Asia

At present, Indonesia is the country with the most unicorn startups in Southeast Asia. Not only that, but Indonesia is also one of the 10 countries with the most unicorn startups in the world. However, this achievement seems not enough for the government.

The Minister of Research, Technology, and Head of the National Innovation Research Agency, Bambang Brodjonegoro, said that Indonesia will have two more unicorn startups early next year. This adds to the list of five unicorn startups that already exist, such as Tokopedia, Traveloka, Bukalapak, Ovo, and Gojek.

“Considering the rapid growth of the digital economy in Indonesia, I am optimistic that Indonesia’s economy will get better. Currently, there are only five unicorns. Maybe, there would be two more. Hopefully, our unicorns can become seven at the beginning of 2020,” he said.

This was being said when he gave a keynote speech at the ‘Indonesia Business News Award (IBA) 2019’ some time ago. “I hope with the addition of this unicorn, the ranking (of Indonesia) in the world will also rise,” he added.

Today’s business world has changed dramatically due to the global digital phenomenon. Bambang hopes that digital technology can be fully applied to the entire industrial value chain. As a result, it can produce quality products and high productivity in the long term.

Indonesian Unicorn Startups Start to Pursue Profits

Meanwhile, Indonesian startups are expected to stop burning money. The reason is that investors will certainly expect their investment funds to generate profits. One of Indonesia’s unicorn startups that will focus on pursuing profitability instead of burning money is e-commerce Bukalapak.

In its 10th year, Bukalapak wants to become the first e-commerce unicorn to achieve a breakeven point (BEP) or even profit soon. “Until now, Bukalapak already has sufficient capital from shareholders to achieve positive EBITDA,” Bukalapak reported in an official statement.

Of course, the goal would be achieved if all plans and programs run smoothly without obstacles. Bukalapak added that being a financially sustainable e-commerce company is important for the company. Then, it is ready to increase product or program monetization and strengthen profitability.

Bukalapak’s gross profit in mid-2019 also increased three times compared to mid-2018. Plus, it managed to reduce half of the losses from EBITDA for the past 8 months. Tokopedia will also pursue profitability next year after 10 years of operating its financial statements.