INDONESIA gets consistently touted as the next great market for technology investors for e-commerce startup.
PT Kioson Komersial Indonesia is going to test how the first startup initial public offering (IPO) about to go live.
Kioson is kind of works like a middleman for small and roadside kiosks looking to sell all kinds of things, from mobile phone credit to airfare. Today, the company’s network spans 19,000 merchants across 300 cities. Kioson is helping Indonesia’s e-commerce industry amidst a challenging environment where Internet penetration is still relatively low though uptake of digital services is high.
Kioson recently raised IDR45 billion (US$3.4 million), which has given them the capability to begin seeking an IPO. It could potentially set the tone for future IPOs from smaller startups, which typically get edged out in the market. “We see ourselves as a bridge between e-commerce and the many people still barred from it because of difficulties in using cash for online purchases”, said President Director, Jasin Halim.
Indonesian startups tend to exit the market via mergers and acquisitions which means that smaller companies usually get swallowed up by bigger firms who then gain even larger market clout. If Kioson successfully debuts, it would be a validation of President Joko Widodo’s efforts to boost startups through loosened restrictions and higher tech-focused investments.
Widodo’s government is targeting to build a US$150 billion digital economy by 2025, and various initiatives have been put into place to support. This includes a “technology board”, a marketplace that would be geared towards helping startup founders and investors take their companies public. However, to get there, the country has to have a robust enough startup environment that isn’t monopolized by a collision of huge companies. Jeffrey Jap, an analyst at PT Trimegah Sekuritas said, “It comes down to implementation because the market is definitely there. While e-commerce is booming in the large cities, most of Indonesia still relies on traditional markets, so there’s potential in bringing them into the fold.” At last.
Image : Teropongbisnis.com