<article><a style="color: #000080;" href="http://www.convergencevc.com/" target="_blank">Convergence Ventures</a>, one of Indonesia’s most active early-stage VC firms, is expecting to close its $25 million fund “very soon”, Adrian Li, managing partner and co-founder of the company, told this portal.</article>

<a style="color: #000080;" href="http://www.convergencevc.com/" target="_blank">Convergence Ventures</a>, one of Indonesia’s most active early-stage VC firms, is expecting to close its $25 million fund “very soon”, Adrian Li, managing partner and co-founder of the company, told this portal.
“We are close to completing the final fund. It’s close to our target $25 million. We have investors coming from the US, China, and Southeast Asia. These are successful entrepreneurs and reputable institutions,” Li told DEALSTREETASIA recently.
The Jakarta-based VC firm announced a $25 million fund in 2014, focusing on early stage startups in Indonesia. The firm has been investing up to $500,000 in 17 companies so far, and is expecting to strike three new deals by the end of the year. In 2017, Convergence plans to invest in at least 10 new companies.
There is tremendous opportunity for tech startup in the country, Li says, supported by the adoption of smartphone, high GDP growth (expected to reach $4,000 soon), and increasing income. As an emerging market in the tech sector, Li sees huge potential in the e-commerce and retail.
“There are also interesting areas in content production, digital and social media. Indonesians consume information like no one else in the region,” Li says.
Convergence’s current portfolio includes <a style="color: #000080;" href="http://femaledaily.com/" target="_blank">Female Daily Network (FDN)</a>, a media portal and forum for beauty products and cosmetics; <a style="color: #000080;" href="https://www.xfers.io/" target="_blank">Xfers</a>, a payments gateway focused on bank transfers for small and medium sized enterprises, and <a style="color: #000080;" href="https://adskom.com/" target="_blank">ADSKom</a>, an advertising technology company.
Female Daily Network is now the largest site for cosmetics and beauty reviews in Indonesia, attracting over 3 million monthly visits, while Xfers is claimed as one of the fastest growing payment startups.
Other companies that have been backed by Convergence are virtual personal assistant <a style="color: #000080;" href="https://yesbossnow.com/" target="_blank">YesBoss</a>, budget hotel chain <a style="color: #000080;" href="http://www.nidarooms.com/" target="_blank">Nida Rooms</a>, and dating platform <a style="color: #000080;" href="https://www.gopaktor.com/" target="_blank">Paktor</a>, all of which have strong operations and traction in Indonesia.
<h3 style="text-align: justify;">The quest for value</h3>
When determining value of a company, Li explains, Convergence looks at three things: the market potential, the team, and the traction. As an early stage VC, Convergence aims to have at least $100 million dollars of outcome from the companies they invest in.
“Team is the most important thing, we want to see their track record, why they are doing the business, are they demonstrating the passion, commitment to business in the long run, and also do they have the right chemistry,” said Li.
“Last but not least, traction. We don’t invest in just purely an idea. They need to actually build a product, not using just any financial capital but also emotional capital,” he added.
<h3 style="text-align: justify;">Big challenges ahead</h3>
Indonesian President Joko Widodo has affirmed his commitment to make Indonesia the “engine” of Southeast Asian digital economy.
But his ambition of creating a digital economy, one that is expected to boost the growth of e-commerce and stimulating the economy in rural areas, and targeted to be valued around $130 billion by 2020, faces many challenges ahead.
“Infrastructure for connectivity is the biggest challenge. For example, 4G connection is not widely available yet,” said Li.
The Indonesian government has been trying to improve the connectivity infrastructure by launching the Palapa Ring Project, a broadband program which is scheduled to be completed by January 2019. The broadband network will cover around 500 districts and cities across the nation, once the Palapa Ring project is completed.
Communication minister Rudiantara had said the government is targeting to provide approximately 1 million domains and hosting to all types of business until 2019. He noted with the completion of Palapa Ring project, 4G phones can be accessed throughout the country and ultimately help boost the growth of e-commerce in the country.
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Exclusive: Convergence Ventures to close $25m final fund this week

Convergence Ventures set to announce final close of $25m fund this week

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