INDONESIA CRUNCH | Nadiem for President

Go-Jek CEO Nadiem Makarim
Nadiem Makarim at the Bloomberg Year Ahead Asia Conference in Jakarta on Dec. 6. Photographer: Graham Crouch/Bloomberg

A few weeks ago, we looked at the debate on foreign investment in Indonesia. One central argument often brought up, especially during election season, is that Indonesia is selling itself out to foreigners. However, Indonesia has a significantly lower percentage of foreign investment to GDP than neighbors like Thailand and Malaysia.

What this country has a lot of are state-owned enterprises, including the largest telco, banks, energy, and electricity companies. Some of those are listed on the Indonesian Stock Exchange, others are not. If you saw all of them as one group, it would be the highest valued one in the country.

The presence of Indonesian state-owned enterprises across the economy is more extensive than in any other country it monitors, except for China, said an OECD report presented during the IMF-World Bank annual meeting in Bali recently.

What’s not state-owned tends to be part of family-owned conglomerates. Here are some of the top listed companies on the Indonesian Stock Exchange (Based on this 2017 list, but some ranks have changed):

    • BCA (BBCA) / Established 10 August 1955 / Market Cap: IDR 575T (Currently roughly USD 37B)
    • Sampoerna (HMSP) / Established 7 March 1905 / Market Cap: IDR 441T (Currently roughly USD 29B)
    • Telkom (TLKM) (State Owned Enterprise) / Established 24 September 1991 / Market Cap: IDR 369T (Currently roughly USD 24B)
    • BRI (BBRI) (State Owned Enterprise) / Established 18 December 1968 / Market Cap: IDR 361T (Currently roughly USD 24B)
    • Unilever Indonesia (UNVR) / Established 5 December 1933 / Market Cap: IDR 334T (Currently roughly USD 22B)
    • Bank Mandiri (BMRI) (State Owned Enterprise) / Established 2 October 1998 / Market Cap: IDR 298T (Currently roughly USD 20B)
    • Astra International (ASII) / Established 20 February 1957 / Market Cap: IDR 278T (Currently roughly USD 18B)
    • Gudang Garam (GGRM) Established 26 June 1958 / Market Cap: IDR 143T (Currently roughly USD 9.4B)
    • BNI (BBNI) (State Owned Enterprise) / Established 5 July 1946 / Market Cap: IDR 130T (Currently roughly USD 8.6B)
    • United Tractor (UNTR) / Established 13 October 1972 / Market Cap: IDR 116T (Currently roughly USD 7.6B)

(Source: Indonesia Investments, Google Finance)

Out of these, some are part of even larger, international groups. For example, Sampoerna belongs to American tobacco company Philip Morris. There are further ties. BCA is affiliated with Djarum, another major tobacco company which is not publicly listed. United Tractor is one of many subsidiaries of Astra International. There are also massive state-owned enterprises that have yet to make a public offering, such as oil company Pertamina, which would probably rank high at the top in terms of valuation.

Most of these companies have existed for decades, or even a century in the case of Sampoerna.

Against this backdrop, it’s all the more fascinating to see local tech companies like Traveloka and Tokopedia soar past a billion dollar valuation in just a few years. Go-Jek, with a valuation that seems to be sitting somewhere north of USD 5 billion, is already measuring up to the list above. (Although we have yet to see if any of them can stand their ground in a public offering.)

Indonesia is, of course, following a global pattern here where internet companies have become economic superpowers. Today, the world’s most valuable companies are all linked to the digital economy. (Amazon, Apple, Google, Samsung, Facebook…)

What’s quite disruptive about the situation in Indonesia is that many of these new internet companies are built by (relative) nobodies. Their CEOs and directors may have links to, but are not necessarily deeply entrenched in the political and economic establishment.

Joko Widodo’s image as a self-made entrepreneur was a big part of his appeal when he began to become known as a politician. Fast forward a few years, and it wouldn’t surprise me if some of the current league of internet entrepreneurs will be groomed for political offices. Nadiem Makarim for (vice) president 2024/2029?Just a thought. He does check many boxes.

Around Indonesia’s tech scene

Tokopedia to align with Ovo

Nice little scoop by Aditya on Tech in Asia ID. Tokopedia wasn’t quick enough to secure its own e-money and e-wallet licenses, and now it seems to be going the way of partnerships. With whom the e-commerce unicorn, partly owned by Alibaba, aligns, is a touchy subject. TIA found some evidence that Tokopedia is about to launch Ovo as its e-wallet – the same one that’s also used by Grab in Indonesia. This means Tokopedia is aligning with SoftBank’s empire. The Japanese mega-investor has stakes in both Grab and Tokopedia. But are wallet alliances necessarily exclusive? In other words, would partnering Ovo necessarily mean Tokopedia can’t also accommodate Ovo’s rival wallet Go-Pay? Either way, roping in Tokopedia first is a power move for Ovo right now.

Former Go-Jek and Grab employees launch new venture

Jesayas achieved something big which is to kickstart Go-Jek’s Go-Food. Now he’s teamed up with a former Grab product manager and this alliance birthed a super big vision: Oy. An Indonesian chat app plus e-wallet plus social commerce. I tend to be skeptical of apps that have super app ambitions from the start. It just seems more likely that apps grow massive because they do one thing well, and then add more features later. But let’s see what comes out of this. Also, who is the mystery investor? Someone linked to Doku? Please send tips my way, hehe.

Hari Jomblo

Lazada said it’s going to introduce Singles Day in Southeast Asia. Singles Day is the yearly online shopping discount bonanza Alibaba invented. It’s on November 11. In Indonesia, it’ll be known as Hari Jomblo. I’m taking note of this because Indonesia already has its own yearly online shopping event, Harbolnas, in December. It’s a “national online shopping day” orchestrated by the e-commerce association. Is Lazada throwing a bit of shade here?

Daily Social launched e-sports site

Daily Social, one of the veteran sites for tech news in Indonesia, is creating an offshoot dedicated to e-sports, Hybrid. A great idea, I think, given it’s a booming industry, with lots of opportunities for events, brand tie-ups, and not to mention a growing audience.


Not about tech, but a must-read for people in the media profession. This “pivot to video” was a thing we all felt, with some real dire consequences. Instead of falling for platform’s promises for millions of views and virality, publishers are better off focusing on deep reporting, building an organic audience, and eventually contributing important stories like these.

Nadine Freischlad is a Jakarta-based journalist, writing about technology, business, culture, and other things. Follow her on Twitter @texastee 

The views and opinions expressed in this article are those of the columnist and do not represent DEALSTREETASIA.