The management of Indonesian edtech startup HarukaEDU is pumping new blood into the company to expedite its growth plans in the region.
The eight-year-old startup, which is backed by investors such as US-based trading firm SIG and Taiwanese VC AppWorks, has roped in new CXOs, is rebranding itself to ‘Pintar’, and is set to launch an eponymous platform that will host its various offerings.
As part of the top-level changes, the co-founders of HarukaEDU are stepping down to make way for a professional team.
Ray Pulungan — an alumnus of Stanford, Harvard, and Yale, who has previously worked for venture capital firm Monk’s Hill Ventures — has been named CEO, with effect from June this year. An official announcement will be made later this year, he told DealStreetAsia.
Pulungan takes the reins from Novistiar Rustandi, who is among the co-founders of the edtech platform.
Other top management changes include the appointment of Safdar Husain as the company’s CTO. Husain, who was previously the chief technology officer (CTO) of the digital lending company JULO, succeeds Erga Munggaran.
While HarukaEDU is a profitable company, Pulungan said investors wanted to bring in new management as the company is embarking on its next phase of growth. “They [the investors] felt they needed a new management in place, and the former management also felt that they wanted new blood to scale the company,” he said.
Co-founder Gerald Ariff, who served as the chief partnership officer of HarukaEDU earlier, said the management change was formalised by mutual agreement between HarukaEDU’s co-founders and its investors, including SIG and AppWorks.
“The co-founders including myself, Rustandi, and Tovan Krisdianto… we have graduated from HarukaEDU, but we remain as advisors because we still have a stake in it,” Ariff told DealStreetAsia. He said the co-founders will not be involved in any operational decision-making, but they will offer advice when needed.
He declined to reveal the amount of stake that co-founders have in the company. According to DealStreetAsia DATA VANTAGE, co-founder Krisdianto holds a 7.97% stake, while Rustandi holds 5.38%. The company commands a valuation of $9.24 million, according to DATA VANTAGE, which arrived at the estimate based on ACRA filings.
“Building a startup is rather tiring. We have sacrificed eight years of our lives, looks like it’s time to hand it over to a more sophisticated team,” Ariff said, noting that he is returning to the academic world to become deputy chancellor at an online university, while Rustandi is joining the corporate world and Krisdianto is taking a break to spend time with his family.
Krisdianto, in a separate message to DealStreetAsia, said HarukaEDU needs “fresh blood” that can take the company to unicorn status.
“We’ve been focused on the OPM [online programme management] for higher education.. a challenging and highly regulated sector. We just started to get into B2C (B2G2C) with Kartu Prakerja and are doing really well, but not well enough to reach unicorn status. This highly qualified fresh blood is taking the ‘rally button’ to the finish line,” he said, referring to the government’s pre-employment card programme that combines temporary social assistance with skills developments.
Going forward, Krisdianto said he is relaunching his consulting business while spending more time with his family. Rustandi did not reply to DealStreetAsia’s inquiry for comments.
“It is not uncommon at this stage for a company to recruit a more experienced CEO to ensure a successful transition and build out the organisation. Historical examples include Google, Twitter, Uber, and many Indonesian unicorns,” Jamie Lin, chairman and partner at AppWorks, said in an email. “AppWorks continues to be bullish on HarukaEDU and expects the company’s growth to accelerate under the new leadership.”
Established in 2013, HarukaEdu started life as a partner to universities that wanted to launch online learning for some courses. It launched its first Pintaria platform in 2018, offering training and soft skills to those preparing to enter the workforce. The next year, it launched CorporateEDU, targeting corporate training for employees.
Pulungan says the company now plans to consolidate its university, short courses, and corporate learning & development — currently offered on separate platforms — while leaving behind the former management’s aspiration to make HarukaEDU an online university in its own right.
“In our current business model, what we’re trying to do is include all these products in a single platform,” Pulungan said, noting that the platform, which is slated to be launched later this year, will be called ‘Pintar’ which means ‘smart’ in English.
“The unified interface, [will make it] easier for the users,” Pulungan said, adding the change will also help the company increase its sales through cross-selling and upselling.
Under its previous management, HarukaEDU partnered with universities such as Universitas Kristen Indonesia, Universitas Al Azhar Indonesia, digitalised their content, and managed the technology side for the learning process. At some points, HarukaEDU helped universities recruit new students.
Going forward, Pintar will focus on being a value-added service provider and is looking at launching student loans, scholarships, training and career consultancy programmes, besides bridging corporations with universities and training centres.
Pintar targets to partner with up to 25 universities and 80 training centres by the end of this year, up from the current 11 active universities and 50 training centres. The company also targets to add 15 corporate partners in the next six months.
“We are communicating with several universities in Southeast Asia and the US. We might later open talks with an Australian counterpart,” Pulungan added.
While Rustandi had previously compared HarukaEDU’s operations to the US company 2U, Pulungan prefers to liken Pintar’s new practice to Guild Education — another US company.
While 2U is in the business of helping universities go online, Guild Education facilitates partnerships between employers and universities to provide employees “education as a benefit”. Guild Education also facilitates direct payments by employers to academic institutions, while offering coaching services to employees.
Demand for edtech
The change in management comes amid an increasing adoption of online education in the local market, Pulungan said.
The COVID-19 pandemic has accelerated the growth of the edtech sector, forcing students, schools, and universities to apply online learning and edtech tools in their daily life. In Q2 2021, Edtech was among the top 10 most funded sectors by deal volume in Southeast Asia according to a DealStreetAsia DATA VANTAGE report.
Edtech startups amassed $68 million from eight PE-VC deals.
In terms of the target market, the edtech sector in Indonesia can be divided into several categories, the K1-K12 students, tertiary students, lifelong learners, and corporate trainees. Prominent players such as RuangGuru, Zenius, and Co-Learn focus on K1-K12 students.
Meanwhile, Pintar targets other segments. “I think K1-K12 [is more challenging]… the monetisation is an issue because you are competing against free. In our country, pursuing K-12 education is relatively free. After K-12, to pursue education in colleges, universities, we have to pay. So we’re not competing against free,” Pulungan said.
Ruangguru received $50 million from New York-based investment firm Tiger Global Management in April.
According to DealStreetAsia DATA VANTAGE, HarukaEDU raised 5.5 million in a Series C funding round in 2019 led by SIG, with participation from AppWorks, GDP Venture, and Gunung Sewu Kencana, bringing the total funds raised by the company to at least $7.37 million. Existing backer Samator Education has also topped up in the round.
Pulungan said there is no plan to raise more funds at the moment but the company is open to potential partners that could propel its business further. “We still have a strong balance sheet .. and our business is profitable,” he explained. “We’re not a cash-burning business.”
Pulungan is welcome to the idea to acquire its competitors in the future.