Lack of Network to Investors is the Main Problem of Regional Startups
Access to affordable funding in all regions is the key to the growth of startups or startups that are evenly distributed throughout Indonesia. However, the Indonesian Venture and Startup Capital Association (AMVESINDO) assesses that the majority of startups are still domiciled in Java, especially Jabodetabek.
William Gozali, Deputy Chairman I of AMVESINDO, explained that even though the growth of startups in Indonesia continues to show a positive trend with the number reaching 2,219 companies by early 2021 according to Startup Ranking records.
“In addition, there are more and more local innovators with interesting ideas and innovations that have emerged in recent years, including the E-Fishery aquaculture technology startup from West Java, Riliv’s on-demand mental health service from Surabaya, and the Gringgo waste management application from Bali,” he explained, Tuesday (16/3/2021).
Association Seeks to Bring PMVD and Startups Together
Meanwhile, regional startup ecosystems are actually starting to be helped by the presence of regional venture capital companies (PMVD). Unfortunately, there is less attention and attention to PMVD and startups in the regions than in big cities.
Therefore, AMVESINDO considers that there is a need for a meeting point between the needs and capabilities of the two in order to achieve a solid investment partnership, the association seeks to facilitate both startups and PMV to find each other and develop together.
“The lack of networks to investors is still the main problem faced by regional startups. We hope that more and more local startups will dare to pitch [presentations] such as startups in big cities. The higher the flight hours through participating in competitions, demonstrations, workshops, incubators, then will further sharpen the understanding of startups with their own business, “he added.
The event will be titled ‘AMVESINDO Pitching Days 2021’ from March to April 2021. This event is expected to bring together local innovators with investors, each from various scales, business sectors, and domiciles.
Startups who participated in this event also had the opportunity to be exposed to more than 70 PMV, PMVD, and VC Tech who are members of AMVESINDO, which of course are officially and directly under the supervision of the Financial Services Authority (OJK).
In addition, according to Tech in Asia data, throughout 2020, the most funding was given to early-stage startups. The high demand for early-stage funding is in line with the number of new startups being born.
In line with these findings, AMVESINDO also encourages this early-stage funding trend to continue, and through this event, startups are also looking for early-stage funding, from pre-series to series A.
The Initial Stage is the Most Important Stage for Startups
According to William, the initial stage is a crucial stage for startups, because, at this stage, startups not only need funds for product development and system setup, but also need a mentoring role from investors, how to implement risk mitigation and determine the right revenue strategy.
“It’s a shame if an attractive product or business idea is not able to survive because founders took the wrong steps,” said William. According to AMVESINDO, apart from access to funding, local startups are also vulnerable to business sustainability challenges due to the lack of support systems for their business development.
Therefore, innovators and regional investors are encouraged to be able to grow together through this event. Carrying the spirit of inclusiveness, this event was held to provide opportunities for local investors and startups to meet, and to find the best innovators not only in big cities, but also in all regions in Indonesia.
In terms of regional investors, Chairman of AMVESINDO’s Membership Division, Rimawan Yasin, revealed that this is the time for PMVD to move from its comfort zone by experimenting with various new, more challenging business verticals.