Exclusive: Indonesia’s Telkomsel to launch growth stage fund with Telkom and Singtel

Photo: Telkomsel

Indonesian mobile operator Telkomsel, a subsidiary of state-owned telco firm Telkom Indonesia, is set to launch a venture capital arm before the end of the year, according to the company’s head of strategic investment.

Nazier Ariffin told DEALSTREETASIA that the CVC will manage a fund of $40 million taken from Telkomsel’s balance sheet and will look to invest in growth stage companies in Indonesia and overseas.

“In terms of industry, we are agnostic since everything is mobile driven now. But we are also looking for something that will be beneficial for Telkomsel’s technology and infrastructure,” he said.

Founded in 1995, Telkomsel counts Telkom Indonesia as its majority shareholder with 65% stake in the company, while the remaining 35% stake is held by Singapore’s Singtel.

The Jakarta-headquartered company is Indonesia’s largest telecom operator with 172 million customers as of 2018.

Earlier this year in July, the company launched an innovation centre called Telkomsel Innovation Center (TINC) to provide Internet of Things (IoT) laboratories, as well as mentoring and boot camp programmes for startups, developers and system integrators with related industry players.

The company then launched an unnamed strategic investment unit in September. Since its establishment, the unit has already made a few investments in startups groomed by TINC.

Ariffin said, Telkomsel is currently in the process of fulfilling the documents needed to transform the investment unit into a corporate venture capital arm, while it starts to process potential deals.

As part of its strategy, the Telkomsel CVC will look to co-invest with the CVCs of its shareholders, MDI Ventures and Singtel Innov8. It is targeting to invest in ticket sizes ranging between $1 million and $3 million,

By setting up a VC arm, Telkomsel becomes the latest corporate in Indonesia to venture into tech investment through a dedicated fund and entity.

The first to do so among state-owned companies is Telkomsel’s parent company Telkom Indonesia, which established MDI Ventures with a fund of $100 million in 2015. This was followed by state-owned lender Bank Mandiri, which set up Mandiri Capital Indonesia in 2016.

Among private companies, however, the CVC trend goes back to 2010 when tobacco giant Djarum Group founded GDP Ventures. Others that have followed its lead include Lippo Group with Venturra Capital and Sinar Mas with SMDV.

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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.