Indonesia investment platform Bareksa targets to close second funding round this year

Bareksa co-founder and chairman Karaniya Dharmasaputra

Indonesia’s Investment portal Bareksa is expecting to close its second round of funding this year, which will help finance three big initiatives, including the roll-out of a new online government bonds sales service, according to co-founder and chairman Karaniya Dharmasaputra.

“We’re not in a rush, but this year we will be raising funds,” Karaniya said in an exclusive interview with DEALSTREETASIA.

Bareksa raised its first funding through a rights issue purchase by Gemilang Dana Sentosa, a backer of e-payment provider Doku, giving the investor 20% ownership of the platform.

Karaniya said that for the upcoming round of funding, four investors have expressed interest in participating in the round. The group of investors consists of two local and two foreign companies.

Though he declined to disclose the figure of the investment or the company’s current valuation, Karaniya said that Bareksa’s gross transaction value, which will determine its valuation for investment, currently stands at Rp 800 billion ($58.4 million).

The funds raised, he elaborated, will be used to roll out its new online bonds service after the firm was chosen by the Finance Ministry last year to be one of only two fintech firms to take part in a retail government bonds pilot project.

Karaniya believes that the online sales of government bonds is a “huge opportunity” for Bareksa – who will earn fee-based income from the bonds sales – particularly given its previous success with mutual funds. Like government bonds, mutual funds used to be sold offline by banks and financial institutions, limiting access to many potential customers. However, the landscape changed after the intervention of technology.

“We are able to leverage internet technology and financial service technology to carry out a deeper penetration. Now there are almost 700,000 mutual funds customers. The growth in Bareksa in 2017 compared to 2016 – we have grown almost 1000 percent. So there is a huge opportunity,” he added.

Bareksa is currently in its final stages of preparation for the pilot project, which is scheduled to be launched in April.

The other two initiatives Bareksa is planning to pursue are the development of a Robo Advisor technology and an Umroh (minor Muslim pilgrimage) mutual fund scheme.

The Robo advisor technology will assist Bareksa customers with advices recommendation, alerts in accordance to their respective behavior and preference, while the Umroh initiative will give the opportunity for customers in the world’s most populous Muslim nation to save up for the pilgrimage through investment in mutual fund.

Launched in January 2015, Bareksa’s services range from financial data to online tool to news and analysis on investment and market. It sells about 128 mutual funds products – or about 20 per cent of the total products available in the industry – from about 30 financial companies. The firm says it currently handles around 2,000 transactions a day.

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