East Ventures has disbursed capital over 80 times this year, with managed funds of US$960 million, or equal to Rp15 trillion.
Heaptalk, Jakarta — Amidst the current global economy’s turbulent prediction in the coming 2023, Indonesia’s agnostic sector venture capital firm, East Ventures, delivered its outlook on the future digital economy potential in the archipelago, specifically for the next year, during the Open Book session in Jakarta (12/05).
Refers to the latest e-Conomy SEA report, which combines data from Google Trends, data from Temasek, and analysis from Bain & Company, Managing Partner of East Ventures, Roderick Purwana, revealed Indonesia’s digital economy is anticipated to attain a gross merchandise value (GMV) worth US$77 billion by the end of 2022. On the other hand, the digital economy is also projected to achieve US$130 billion, growing with a compound annual growth rate (CAGR) of 19% by 2025 and is estimated to elevate three folds, from around US$220 to US$360 billion by 2030.
“The digital economic GMV enhancement in Indonesia has climbed two folds, compared to the country’s Gross Domestic Product (GDP). Therefore, related to the digital economy conditions in 2023, we remain bullish for Indonesia’s digital economy. Although the macro economy is facing several complex obstacles, we have strong confidence the startup founders will be able to create a positive impact around this industry,” Roderick added.
Meanwhile, the Executive Director of the Institute for Economic and Financial Development, Tauhid Ahmad, admitted a diverse outlook. He observed the technology startup development in Indonesia would experience the slow performance as the purchasing power of people diminishment during this global economic slowdown.
Regarding investment activity, Tauhid perceives that startup practitioners would also encounter complicated obstacles. Previously, he explained the digital sector investment in the country had attained US$9.2 billion. Nevertheless, until November this year, Tauhid claimed the digital investment value has only been achieved by US$3.4 billion.
However, as the venture capital firm, Roderick affirmed the company would utilize the crisis phase by discovering new potential. For this reason, he encouraged the startup founders to advance their capability in navigating, utilizing the data, managing the fund properly, and determining strategic considerations more quickly and accurately for further business operations.
“We recognize a positive enhancement of Indonesia’s digital economy is also influenced by the internet uplift penetration, digital infrastructure escalation, and high literacy society around this industry. Therefore, we delineate 2023 as the racing in the perfect storm,” Roderick added.
East Ventures’ investment record
Since its establishment in 2009, East Ventures has more than 250 funded companies, with over 450 founders and 30 exits. During the company’s journey in 2022, East Ventures has disbursed capital over 80 times this year, with managed funds of US$960 million, or equal to Rp15 trillion. The Partner of East Ventures, Melisa Irene, conveyed the company has an Asset Under Management (AUM) worth US$1 billion, or approximately Rp15.6 billion.
“This year, we have set up a fund of US$550 million as the latest capital, intending to inject the early stages startup worth US$150 million and a US$400 million devoted to the growth stages startup. Until the third quarter of 2022, East Ventures has invested in more than 80 companies, spanning the early to the growth stages,” Irene added.
Realizing the promising market of Indonesia for the startup ecosystem elevation, Irene affirmed that the company aims to reinforce the capital injection activity around agritech industry if previously performed investment in several sectors, including e-commerce, supply chain, science, and technology.
“We have a mission to bring success to the technology startups and deliver sustainable impact on the digital ecosystem in Southeast Asia. Thus, we believe the venture capital contribution is a critical factor for accelerating the business growth of startups,” Irene said in her statement.
