There are several factors drawing Chinese investors to look into the Indonesian market, e27 reported at the Convergence Ventures event.
According to Horizon-China & Feimalv Capital Founder Victor Yuan Yuan, Indonesia’s multiracial background makes it easier for foreign investors to bridge-the-gap between their own culture and that of locals. The country also has a “stronger Chinese connection” compared to other emerging markets. He also saw some similarities between Indonesian and Chinese technopreneurs.
“The big innovation is done by people who are even younger [than most Asian markets]. If I look at the average age of innovators [in Indonesia] are younger than in China, so it’s even more promising,” Yuan said. When it comes to focus, Yuan believed that the service sector will remain popular in the next years. The investors will also focus on pre-Series A and Series A rounds of investments.
The big innovation is done by people who are even younger [than most Asian markets]. If I look at the average age of innovators [in Indonesia] are younger than in China, so it’s even more promising.”
The Gold Rush of Southeast Asia
The past year has seen China big players make their presence known in Indonesian tech startup scene. Alibaba had tried to expand its coverage in the country by launching Aliexpress before changing its strategy by acquiring Lazada in Southeast Asia. Alibaba’s competitor, JD, also has launched quietly last October. This article on Tech Crunch, urges business to “forget China because there is an ecommerce gold rush in Southeast Asia.”
“What we are going to do is set up a club, then probably an incubator, a multidimensional mechanism to support local startups,” he said. “Our own organisations will also invest in here, especially since this is a scalable market with [a] rising economy,” he added.
Likening today’s Indonesia to China seven years ago, he also called for local investors and businesses to collaborate together. As investments and attention has been turning to Southeast Asia, Indonesia in particular, there are factors that indicate how the region can be seen as China’s younger sister. However, the region is slowly catching up and showing a lot of potential, which explains why Chinese investors are looking in.