How to become an Indonesian unicorn

An interview with the Bukalapak CFO uncovers how the e-commerce marketplace grew from a small garage office to being Indonesia’s latest unicorn. As the Indonesian digital economy continues to grow, the government encourages the younger generation to become actors, not just spectators. 

Tempo – Interview: Young on top, Bukalapak’s secret to increase valuation (video)

Interview with Bukalapak Chief Financial Officer Fajrin Rasyid.

  • Q: Bukalapak is now a unicorn. What is the next goal in 2018?
    A: Being a unicorn was never a goal, it is more of a milestone. Our vision remains the same: how to increase the number and turnover of sellers.
  • Q: What is the annual growth of sellers in Bukalapak?
    A: Over 100%. For example, last year we had 2 million sellers, this year we have 3 million. Hopefully by the end of the year we have 4-5 million.
  • Q: Flashback to 2010. Finding people to sell on Bukalapak was very difficult at the time. Tell us a bit more about how difficult it was at the beginning.
    A: Each stage has its challenges, even now we still have challenges. At the beginning, it was difficult to educate the market of our product. Our investment capital was very small. We contributed our own money for investment, which was used to pay our own salaries. So we didn’t allocate any money for major advertisements. We tried to identify existing online market platforms, such as social media and online forums. We introduced ourselves and our products and also asked for permission from sellers to sell products.
  • Q: You graduated with honours from Institut Teknologi Bandung, received a scholarship in Korea and eventually worked at Boston Consulting Group with a generous salary. What gave you the courage to become an entrepreneur where there are so many uncertainties?
    A: At the beginning I was just a part-time consultant, then after a few months I asked to join as a partner or co-founder. I was still young and thought that if this fails, it would be easier to manage.
  • Q: How did Bukalapak increase the number of sellers without a marketing budget?
    A: We tried to increase the traffic of buyers. The unique thing about the founders of Bukalapak is that we all have a background in IT, so we used and applied that knowledge. For example, we applied SEO, so even though we didn’t have a marketing budget, our website would pop up in Google or other search engines. Organic searches was one of the sources of our traffic, until now.
  • Q: You also approached communities.
    A: Yes, this goes back to low-budget marketing. Offline, we identified people who like to sell things. Among them are hobby communities, especially if you want niche targets.
  • Q: How many employees do you have? And how did you gather the talent?
    A: We have around 1500 employees. At the beginning it was difficult because our office was very small. Even today it is not easy. Our principle is that our employees are our assets and even partners, and we try to empower them the same way we try to empower our sellers and customers.
  • Q: How do you build a winning team? Especially now with competition to steal talent?
    A: We need to have a strong vision of where we the organisation is heading. Then, we give them a sense of ownership. We try our best not to give orders, not to be top-down. We also allow flexibility in terms of work hours.
  • Q: What is the main differentiation compared to other e-commerce platforms?
    A: We focus on our customers, what they need and how we can fulfil those needs.

Kompas – Indonesia is South East Asia’s largest digital economy, don’t be a spectator

  • A survey by the Association of Internet Service Providers Indonesia (APJII) recorded the number of internet users in Indonesia in 2017 reached 143.26 million people. This figure is higher than in previous years of only 132.7 million (2016), 110.2 million (2015), and 88.1 million users (2014).
  • Google research with Temasek (August 2016) indicated the growth of internet users in Indonesia is the most rapid in the world, at an average increase of 19 percent per year.
  • The study projected the number of internet users in Indonesia will reach 215 million people by 2020. Indonesia’s online market value is predicted to reach US$81 billion before 2025, with e-commerce accounting for 57 percent or US$46 billion.
  • The findings are similar to a study by Indonesia Venture Capital Outlook 2017. The study conducted by AT Kearney and Google noted capital flow into Indonesia’s digital ecosystem grew from US$300 million in 2012 to US$6.8 billion by 2016.
  • The state of Indonesia’s digital economy today is believed by many to be similar to China’s five to seven years ago.

Big opportunity

  • The positive response of investors to the startup industry and continued flow of capital to the sector must be utilised carefully by local business actors.
  • According to Managing Director of Kejora Ventures – capital funding company for startups – Andy Zain, there are many problems in the country that could be a business opportunity to establish start-ups. Having said that, he also emphasised not all issues suit start-ups because a large portion of the population still do not use nor understand the internet.
  • Indonesia is big, bigger than America. So if you want to set up a start-up, the vision should be to make a big impact in Southeast Asia because this is the region we want to dominate,” he said.
  • Head of Creative Economy Body Triawan Munaf said start-ups not only need enough knowledge and funding, but also need to learn entrepreneurial tenacity, risk-taking, and integrity to become an entrepreneur. This is where higher education institutions can contribute.
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