Indonesia is considering starting talks with Korea and Japan to form a council for venture capital firms, the Indonesian VC and startup association (AMVESINDO) chairman Jefri Sirait told this portal.
The council is intended to be a forum to connect investors, regulators, players, and all the industry stakeholders in Indonesia, Korea, and Japan.
“The first function of the council is to share, the second function is to connect, and the third is to improve capabilities of each country. We are evaluating a dialogue on the same with these two countries since last year,” Sirait said.
In August, Singapore and Indonesia that were joined by Thailand in October launched the ASEAN Venture Council, a collaboration between venture capital associations in the ASEAN countries. The council was spearheaded by the Singapore Venture Capital & Private Equity Association (SVCA), and included AMVESINDO and Thai Venture Capital Association (TVCA) as members.
The ASEAN Venture Council, in particular, is aimed to assist its member associations and their members to promote venture capital across the region. This is set against an industry that has seen phenomenal growth in the past few years, with the bulk deals being cross-border in nature.
The proposed council will be an umbrella organization consisting of venture associations interested in the promotion of the ASEAN Venture Capital Ecosystem. It is intended to enable its member associations to promote and develop the venture capital industry in a more concerted way across the region leveraging each other’s strengths and capabilities – particularly in the areas of events, advocacy, research, education and deal flow.
20% growth in 2017
Sirait said AMVESINDO’s VC members have collectively targeted 20 per cent growth in investments this year. In 2016, the total investment for tech-based startups alone reached Rp 2 trillion ($150 million), 66 per cent higher than Rp 1.2 trillion ($90 million) investment in 2015.
“Financing and equity participation rose quite significantly last year,” Sirait said, without revealing the detailed portions.
“What has become one of our homework this year is that we need to convince our members that transparency (for financial performance and investments) is important for the industry. We want to push them so that they can be more open starting this year,” he added.
Astra Mitra Ventura, the investment arm of Indonesia’s conglomerate group Astra International led by Sirait, doubled its sales with 20 per cent growth in profit last year. Meanwhile, its non-performance investment (NPI) stood at only 1.3 per cent due to prudent investment strategy, Sirait said.
This year, AMVESINDO’s main agenda is to set up a national VC fund to invest in tech-based early-stage businesses across the country, which would require about Rp20 trillion ($1.5 billion) of annual investments. The association has been in discussions with the coordinating ministry for economic affairs for almost a year to push the fund. Sirait said that the fund would be backed by both the public and private sector.