Partner content in association with Alpha JWC Ventures

Alpha JWC Ventures, Hangry, Bobobox and Lemonilo share tales of resilience and growth amid the pandemic

Indonesian startups raised about $1.5 billion in Q2 2021 – above the month on month, pre-pandemic level. In Q1, the figure was even higher at $2.64 billion.

These statistics set the tone for a session at DealStreetAsia’s PE-VC Summit 2021, ‘Tales of resilience and growth among Indonesian companies during the COVID-19 pandemic’, sponsored by Alpha JWC Ventures.

Through the course of the session, the founders of startups across a diverse range of sectors gave deep insights on the strategies they had deployed to first survive and then grow and expand through multiple waves of the COVID-19 pandemic.

For Abraham Viktor, CEO, Hangry, part of the solution came from starting well before the pandemic and having adopted and optimised for a ‘delivery first’ model. He said, “When creating our chicken dish, we designed it to last in an enclosed package for two hours, and still remain crispy, warm and juicy. That made a difference when the pandemic hit. Happy customers bring in more happy customers. Through the pandemic, we focused on making sure they were happy with safety measures, and a consistent product.” Hangry grew 22x through 2020. Its plans for the future include going deeper into Indonesia, driven by a less competitive scenario outside Jakarta and a more capital efficient structure in tier 2 and tier 3 markets.

The hospitality sector was among the worst hit by the pandemic. However, through the course of COVID-19, Bobobox managed to pivot, offering a range of sanitised accommodation options. With its uniquely designed premises, some of which were launched in response to the pandemic, it was able to gain from the huge uptick in domestic tourism. Speaking about the lessons learnt on the comeback trail CEO Indra Gunawan said, “The domestic market will be the main focus at least for the next 2 years. Budget accommodations are bouncing back faster and there will be a bias towards domestic travel. Given the preference for outdoors, we decided to implement our modularity and space efficient concepts as well as our technology in an open environment. That’s how we came up with BoboCabin.”

The increasing demand for healthy food, certainly benefited Lemonilo, a FMCG firm with a range of healthy food products including noodles and snacks. Driven by a digitally led model which relies heavily on knowing the pulse of the consumer, Lemonilo was able to repurpose its manufacturing units to even create hand sanitizers to meet the demands of consumers. Co-CEO and co-founder Shinta Nurfauzia described how the company shifted to cater to an unusual consumer demand and said, “We didn’t know that the indulgence category would be pandemic resistant. But we have really good inputs from our consumers about what they would like to consume. I think it’s because boredom sets in easily when you are forced to be at home.”

Alpha JWC Ventures co-founder and general partner Jefrey Joe believed the pandemic changed the landscape for investors as well as founders. He said, “Founders coming in after the pandemic were not only more risk taking, but also more experienced, and serious about building startups. There was a lower quantity but higher quality.” Examining the patterns of investment, he added, it was easy to identify the investors who were really committed to Indonesia from those who were merely opportunistic.

The session was moderated by Joji Thomas Philip, editor-in-chief and founder, DealStreetAsia.

Watch the video of the session here and read the transcript below, edited for clarity and brevity.

We are 18 months into the pandemic. Can you recall the situation last year and give our audience your initial reactions when the pandemic hit? What were the questions you had to ask to avoid potentially painful future consequences?

Abraham Viktor (AV): In the early months, it was a bit tough. We asked ourselves questions that were almost existential in nature. How do we operate when our staff and customers may be at risk? Later on, it got answered, with us implementing safety measures. The second thing that we asked ourselves was whether or not food delivery was here to last. Our revenue was down by 30% and we were nervous because it was the first time that we’d seen a downtrend. It was nerve wracking but after two months, everything was back.

Indira Gunawan (IG): When the first two positive cases were announced, we saw a rapid decline in occupancy. The same trend affected all hotel operators in Indonesia. A lot of them were down to single digit occupancy rates. What made it worse was it took place through the fasting month in Indonesia.

Our occupancy rate dropped from 90% to 30% – 40%.

The question was how can we navigate through the pandemic? When will it end? We did a lot of scenario planning. We looked at how China dealt with the crisis and tried to simulate what would happen if occupancy dropped below 20% or only bounced back to 50% or 60%.

Shinta Nurfauzia (SN): I was in the United States planning for an expo with my partner, when we first heard about this. We rushed back because we didn’t know what’s going to happen to the entire country. A lockdown seemed inevitable. At that time, thankfully, people stocked up their groceries and our instant noodles were among the products they bought.

The impact was quite clear. We wanted to keep people safe and so switched to work from home. We also changed a lot of our marketing strategy. We learnt a lot from that.

What was your first reaction as an investor, Jefrey?

Jefrey Joe (JJ): It was one of the scariest moments in my life. In the first month, nothing happened or moved and we could not get into a discussion on business. It was all about health and the pandemic.

But we organised a couple of events to share thoughts on – for instance – the economy or healthcare. We had a panel with the economist, Dr. Chatib Basri to share how the economy was impacted. We also got on calls with some of our affected companies.

It was not one size fits all. Every company had a different situation. Some were actually positively impacted and others that were affected negatively. But back then the most, the number one focus was safety and wellbeing.

At what point did it occur to you that this challenging situation could be turned into an opportunity? What was your lightbulb moment?

IG: As soon as the lockdown lifted in May, we saw a rapid increase in occupancy. We were surprised since we had seen hospitality players lay off staff and cut costs. That was our ‘aha’ moment – trying to figure out why we bounced back faster. We realized that we had over 90% of the domestic market. A lot of operators that were suffering were losing foreign markets that they used to have.

Over 90% of our users are millennials who were more bullish towards the pandemic. We thought if we enhance our hygiene and health protocols to give more of a safety assurance, we can fare much better than competitors.

AV: We knew we had to survive, because we had a lot of employees and the bulk of them were blue collar workers. We decided to ensure employee safety and split shifts between A and B teams, to ensure that if even one shift contracted the virus, we could still operate with the other.

The moment of enlightenment was when we began talking to customers on whether they would opt for food delivery as a lifestyle, post-pandemic. The result was encouraging.

However, they were looking for a safety assurance. We started brainstorming internally on how we could ensure our food packaging is always sanitised and clean. It boiled down to implementing a lot of precautions which we communicated to our customers.

SN: One of the plus points of being a company that tried to increase the awareness of a healthy lifestyle in the pre-pandemic era, was that we now found ourselves in a unique spot, where people were interested in embracing such a lifestyle. We sped up our product innovation. Suddenly, people at home were talking more to customer service which gave us insight into the sort of products they needed. For instance, we produced our own version of hand sanitizer. People were asking for it at the time, and it was sold out everywhere.

Since we had an expertise in an accelerated innovation process, we could launch sanitizers in less than 2 months, when alcohol was very hard to come by.

We are also happy that people now realise the importance of a healthier lifestyle. We will continue to do what we did pre-pandemic – encouraging them to make that switch and why our products should be the first preference.

Returning to Alpha JWC Ventures, once you assessed the situation, what was the next step?

JJ: We saw this as an opportunity to get into the cap tables of companies who may not really have been raising at that point. From June last year until now the pandemic really changed the landscape for many investors and founders. Founders coming in after the pandemic, were not only more risk-taking, but also more experienced, and serious about building startups. It’s always hard but building during the pandemic was even harder. There was a lower quantity, but higher quality.

In terms of the investors, we could see who invests actively in Indonesia, and also in the region. We also see who remained active. That signals to us the ones who are really investing and those who are more opportunistic.

In 2021, we invested in a lot of companies. We’ve never been this busy and active. The highest number of investments that we’ve made was in 2021 and also the highest capital deployed. In terms of valuation, maybe it was a bit reasonable or lower during the initial part of the pandemic, but now it is increasing not just across the region, but globally. It’s good for founders but maybe not so good for investors.

In 2021, as of now Southeast Asia has seen about 20 unicorns. That’s the total number that Southeast Asia had all the way until 2020….

JJ: And that’s largely because of liquidity. We are still assessing the situation. To give some context, Indonesia is in a good shape. The hospitalisation rate is very low below 50%. Things are looking up but to be honest, who knows what will happen in the next few months? We should still be cautious.

Fortunately, we operate in a digital economy. Which means, even if the total economy is stagnant, digitization is actually going to increase. That’s a very strong tailwind and we are a beneficiary.

Indra, considering your model relies quite a bit on budget travel, what parts of the business were rendered less relevant and who replaced them? What were the new revenue models that you pioneered through this time?

IG: Before COVID, the main priorities when people wanted to choose accommodation were affordable pricing and strategic locations. Ever since COVID, hygiene is the number one concern. What they want is less interaction with other people in a seamless, contactless experience, with health protocols in place. And last, but not least, social distancing and less crowds.

I saw that as an opportunity. Pre-COVID, when people travelled frequently the duration of stay was one or two nights. Now, we’re looking at longer stays. That’s also because companies are implementing work from home policies.

Looking at these new behaviours and preferences, we thought that given our unit economics, we can compete a lot better. We still can offer lower pricing, but at the same time, since our premises are uniquely designed, we can tell our guests that health protocols are being implemented correctly. Having technology integrated into the sleeping pods is another advantage – what we began 2 years ago as a contactless experience has become something that many people are looking for since they want to interact less with other people.

A related question: I’ve read that 80% of your bookings came via the app. Was technology a big differentiator because you were not depending on travel agents?

IG: Even today, we still work closely with OTAs. But how people find us is different. During COVID, a lot of OTAs were seriously impacted and didn’t run any campaigns or initiatives. And that’s when people found us more easily, since we have our own site and app. It gives them direct access to their rooms. Seamless experiences allow us to have more recent acquisitions via app.

At Lemonilo, how did you grow community numbers by 30% to 40% month on month?

SN: People were bored being forced to stay home. We tried to create some online activities that could benefit our community. We created an event called Lemonilo Festival: including health, education, sport activities, etc. We tried to get people to sample products.

We do a lot of online activities, because, as a consumer brand, one of our obligations is to keep the conversation going. We wanted to be creative, despite having no offline activities.

Even after the lockdown lifted, there were a lot of barriers to offline activities. We needed to be creative, to do community activation. Vaccine centres or even cemeteries during Ramadan are now sites for activation. We want to be where people are. It is important to know local communities, what they want and like.

What impact did this have on your online marketing spend?

SN: We already have very strong numbers across social media. Every time we do an activation, it’s organic. But we also used celebrities and key opinion leaders to talk about the importance of switching to a healthy lifestyle. We always see our marketing budget in aggregate.

For a company like us, 360 marketing ranges from TV commercials to digital activation. You cannot just slice and dice and see what the ROI is specifically for Google. Sometimes you put your ads in Google, but people make purchases offline. We see what the budgets are versus sales, and the real money in our bank account.

How did Hangry grow 22x in 2020 after a revenue decline of 30% immediately after the pandemic?

AV: First of all, thank God! Before the pandemic, we would sometimes wonder why we hadn’t started off with a dine-in business. But when COVID hit, we were thankful that we started as delivery first.

We knew that if there is an F&B player who can survive, it is definitely us, since everything was built around the delivery model. When creating our chicken dish, we designed it to last in an enclosed package for two hours, and still remain crispy, warm and juicy.

That made a difference when the pandemic hit. Happy customers bring in more happy customers. Through the pandemic, we focused on making sure they were happy with safety measures, and a consistent product.

Was the pandemic the biggest boost to your growth at Hangry? And did coming from a non F&B background give you a better perspective?

AV: The pandemic left people with no choice but to order online since manual operations were paused. But irrespective of whether there is a pandemic, customers always want better products. When we launched, we asked if what we have on offer is the best in the market. Only after we were confident on that front, did we launch anything. One day, when you come to Jakarta, I would love for you to do blind tests of our products with those from our competitors.

Business models also matter. Our business is far more capital efficient than a traditional restaurant. We didn’t have to invest in dining premises and the same kitchen hosts multiple restaurants with different brands. It gives us many levers to grow business. For instance, we don’t need to increase the number of kitchens to grow. Adding menus and more brands will naturally make that happen.

From the VC perspective, if you look at Indonesia or Southeast Asia, very few have invested in the consumer businesses. How big an opportunity is this?

JJ: We are an Indonesia focused fund. Using that lens, we believe the playbook will evolve. B2B is not that common yet. SaaS has still not taken off in this region. But there will be more opportunities in B2B and SaaS.

In terms of the consumer businesses, it is still very early. A VC can give conventional businesses quicker access to capital and help build an organisation faster. How new consumer startups execute will be different compared to established businesses.

But to give the other side of the story, the consumer space is also quite challenging. There will be more players at a lower barrier of entry, and the incumbents are pretty strong. While we are very bullish, unlike what people may guess, it’s not easy. We are actually very cautious.

Some early investors in consumer startups – especially in Indonesia – have secured good exits and returns. The valuations of some of your own portfolio companies in the space have shot up. Will more VC firms enter this space?

JJ: Yes. Not only here, but in many other spaces. Indonesia has an increased attractiveness for global investors. Largely because of what happened in China, more investors are shifting their capital to this region.

In the consumer business, the likelihood of exit is very high. We know it is a profitable business and there is a high visibility on what the exit will look like. We know what the multiple is likely to be, at least based on the current market comparables.

Bobobox has launched new offerings like campervans and cabins. What made you launch all of these amidst the pandemic?

IG: We found that the domestic market should be the main focus at least for the next 2 years. Budget accommodations are bouncing back faster and there will be a bias towards domestic travel by car. We have seen a lot of data on people on a staycation looking for authentic experiences. We found that people want to travel and spend time with their loved ones and friends. They just want to find the right destination. Last but not least, there is a preference for the outdoors.

Based on all that data we figure out, what if we were to implement our modularity and space efficient concepts as well as our technology to be set up in an open environment? That’s when we came up with BoboCabin. We went to a lot of outdoor destinations and the locals had seen a huge increase in traffic. They had more customers than before COVID. We figured this is a great opportunity for us to tap into these places and offer something that is better and more flexible. With technology integrated into the booking process and cancellation.

With the right concept and access to capital, we can grow a lot more aggressively.

Has Lemonilo been launching new products in the indulgence category? What makes you think that this category is pandemic resistant? Do you crowdsource ideas and feedback?

SN: We didn’t know that the indulgence category would be pandemic resistant. But we have really good inputs from our consumers about products they would like, during the pandemic. The indulgence category is among those. It’s because boredom sets in easily when you are forced to be at home.

Basically, we hear from our consumers and create something that they want. Being a company that has a direct connection with our consumer, because of our B2C approach, we really know their likes and dislikes. If we compare the model between us and a conservative FMCG, every time they need to launch something, it has to be big. And they need to launch via offline channels.

At Lemonilo, we launch everything in small batches, using our own B2C platform. We can gain real consumer insights and improve the quality of our products over time, before we launch and scale it to regular outlets.

In the span of 2 to 3 months after the launch, we can improve not just the taste and texture but packaging and pricing. This has helped in speeding up product innovation, and also the launching and scaling up process.

Hangry has spoken about the advantage of not having physical restaurants. But I understand you now plan to launch several physical outlets and grow from 40 cloud kitchens to 300. Take us through your expansion plans

AV: Our company strategy is mainly driven by the customer’s voice. Our biggest tech investment is actually making sure that complaining is easy. That’s one of the biggest pain-points that customers have while buying food online.

It’s the same with physical stores – our customers would like to see some flagship shops where they can actually enjoy our food with friends, rather than doing it at home alone, as most have done through the pandemic.

Going forward, we will strategically open some dine-in stores to accommodate that demand.

We have seen interesting trends in our operations outside Jakarta. The outlets outside make more money. The reasons are less competition when compared to Jakarta where we have thousands of restaurants located very close to each other. And the second is that operational expenses are cheaper outside the capital city. Salary levels are much lower, while purchasing power is the same. For that reason, we would like to penetrate second tier cities across Indonesia that we haven’t got a presence in as yet.

We recently reported that Alpha JWC Ventures had done the first close of its third fund at $300 million. At the final close, you will be among the largest seed to Series B funds in the region. In terms of investment theses, what will change with the new vehicle?

JJ: Indonesia will always be our main market. With the larger fund size, we can deploy in neighbouring countries as well, but how we see ourselves deploying the third fund is that when the market matures, everything gets accelerated. The time needed for each round is also getting shorter and will require more capital.

Especially if we are in the recovery phase after COVID, we will see quite a lot of movement in the market. Recently, the market has been extremely hot. Thanks to a lot of good catalysts – among the most important of which has been the Bukalapak IPO ­– Indonesia is viewed as a good marketplace. The most amazing part is that we don’t need to rely on VCs. There are retail and public investors as well. The next 3 years will be more exciting than the past 5 or 6 have been.

Bobobox raised about just under $12 million in May last year. Would your fundraising have been very different a few months later?

IG: We had a lot of interest from strategic investors because we were performing at 90% across all locations. The discussion started before the pandemic, and then it hit. But luckily for us, we bounced back a lot faster. Potential investors at the time saw the recovery and the resilience of our team in improving the business and revenue model. We were agile in creating additional features: we made booking more flexible and put in place better cancellation policies, and a seamless experience. It gives investors more confidence, and that’s why we managed to not just close the round, but have a bigger one than was initially planned.

Fundraising after the pandemic could be exciting as well, because we have launched more products. The new product market fit adds a lot of value. Since we launched in February, it has been 100% occupancy throughout all locations.

As long as we listen to consumers and come up with the right solutions, now is the best opportunity. We have also seen a lot of hospitality players like Airbnb navigate through this pandemic and manage to get an amazing IPO. That boosts investor sentiment.

How tough was it for Lemonilo to raise its undisclosed Series B, earlier this year? And what does it take to be a woman founder and operate in the consumer space?

SN: Honestly speaking, no entrepreneurs like the fundraising cycle. It is something that we need to do however and become good at over time. It’s tough but our business model and our consistency helps. What an investor wants is to see whether the company can survive in the middle of a pandemic, whether the business model works, whether you have good products. Ups and downs are acceptable for any business, as long as you know how to get back up and can play this long term. That’s how Lemonilo was able to fundraise even in the middle of the pandemic.

Being a woman founder, I honestly don’t think gender is a very important factor. The most important factor is being able to prove as a founder that your company can continue to grow whatever the situation. Being a woman gives me a unique position to bring a new perspective to the table. In our case, 60% to 70% of our consumers are women. I experience the woman’s perspective and am the biggest fan of my company.

Was Hangry lucky because most investors understand the concept of cloud kitchen? Also has it been easier to raise capital as a second time founder?

AV: Not a lot of investors actually understand what we do. Our ambition seems daunting – to build the next generation of global brands and to become part of a global citizen’s lifestyle in the next few decades. It took a lot of talking to a lot of investors to find the ones that are genuinely interested. Being a second time founder probably helps open doors, but fundraising is something I genuinely hate, like Shinta said. Being a second time founder doesn’t make it easier at all.

Capital is a commodity today and the best companies have access to it from regional as well as global funds. What value-add do you bring? Or are entrepreneurs tempted by the highest valuation?

JJ: I will say the best founders always carefully choose who is going to be on the cap table. Our best founders do not choose the highest valuation. I have quite a few data points, saying that the best founders will sacrifice valuation over the right partner. That will be the case, especially as the ecosystem matures.

There will be transparency. When I started in 2015, no one could accurately predict how Alpha JWC Ventures would behave. But now that we’ve been in the market for years, what we did in the past has been determined as right,

That predictability, the positioning of each of the firms will make a big difference in how the founders choose. But the reality is that no VC firm is the same. The most important thing is that now we have more data points. A lot of our founders did reference checks before accepting our offers, and that will be the norm.

With multiple waves of COVID, with no end in sight, what’s your biggest challenge?

AV: Every day, I think about how we can build an enduring global brand. With customers in Indonesia and across the globe spoilt for choice, it’s not enough to be good; we have to be great.

And such happiness is usually proxied by NPS. The higher the NPS, the more promotion comes from your customers. We’re definitely still very early in this journey.

You have talked about building a global brand. Is scaling your biggest challenge?

AV: Scaling is challenging, but it was even more so when we first started. Fortunately, there are a lot of players we can learn from including large QSR chains. We have a very high rating in delivery platforms with much higher NPS. Our homework is to get people to try our product for the first time.

What are the whitespaces in Indonesian consumer industry where there are no local products so far?

SN: There are a lot of whitespaces in Indonesia and plenty of room. For example, Lemonilo decided to be hyperfocused on the instant noodles category. We have launched 40 products, and are still figuring out the next big thing for the decade. Needs changes and in Indonesia we have increased our GDP around 6 times over the last 20 years. Our aspirations have also changed. People demand healthier, better tasting products with better ingredients, and this becomes our quest every day.

Do you think the flexible lifestyle of millennials – from living and working in different cities to doing many shorter vacations or travelling to unique places – will be a big driver for your business?

IG: I believe so. Remote work will last even after COVID is behind us. This pandemic has allowed a lot of people, especially in the domestic market, to explore more of Indonesia. We have many great spots and attractions with breathtaking views. Those will be the right locations for a mobile cabin.

Consumer businesses are capital intensive and there’s only so much that VCs can do. Have these businesses reached a level of maturity where you see PE firms or even sovereign wealth funds stepping in? When will Indonesia produce unicorns in the direct-to-consumer vertical?

JJ: Our playbook is companies with less capital requirement compared to the conventional model. But when they want to grow, we believe that is an opportunity for later stage investors – sovereign wealth funds or private equity.

When do we see a unicorn? I will say very soon! Knowing your ability to sniff the deals out very quickly, I wouldn’t be surprised if something comes up in the next few weeks.


For more information on Alpha JWC Ventures, please visit the website

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.