Indonesia’s 1st NextICorn International Summit aims to create a Digital Paradise
An announcement by the Ministry of Health of the Republic of Indonesia featured the initiative of the Indonesian government to facilitate a collaborative meeting between digital start-ups and investors through the 1st Next Indonesia Unicorn (NextICorn) International Summit 2018.
President Joko Widodo has established a long-term mission to making Indonesia as the Digital Energy of Asia as early as 2016. The Indonesian government aims to become the largest digital economy in Asia by 2020.
Through the e-Commerce Roadmap and the Digital Start-up Program, government ministries and agencies, stakeholders, starts-ups, and digital technology companies with valuations of more than US$ 1 billion (unicorns), collaborated to guarantee that the industry's digital economy valuation could reach US$ 130 billion by 2020.
As of current, there are four unicorns in Indonesia: Go-Jek, Traveloka, Tokopedia and Bukalapak. The 1st NextICorn International Summit 2018 is an initiative of the Indonesian government and the Venture Capital Association for Start-up Indonesia (AMVESINDO). This forum was an opportunity to bring together start-ups and domestic and foreign investors, possibly collaborating to create a new unicorn.
It was the first time that the four Indonesian unicorns were on the same stage. Their role is to be the gatekeepers of the voyage to Indonesia as a Digital Paradise, a platform that allows global and national investors to develop the digital economy in Indonesia. This platform also allows start-up companies to grow and develop with regulatory ease and certainty of funding.
With the theme of “Voyage to Indonesia as Digital Paradise”, the 1st NextIcorn International Summit 2018 brought 98 investors from 67 venture capital companies. 1,023 confirmed meeting schedules, involving more than 200 participants, happened on 10 May 2018. The meetings are expected to bring in more investments and funding opportunities for digital start-ups.
Based from experience, it is relatively easy for start-up owners to get funding in the beginning, which is commonly called Series Pre-A or Series A. Then, it would be difficult for them to get funding when the range is more than US$ 1 million.
On the other hand, investors from the venture capital firms experience difficulty in finding decent start-ups to fund.
This forum was initiated by the government as a response to the request of the start-up industry to create an opportunity that will facilitate start-up meetings. The government knows the importance of creating avenues for this kind of forums because Indonesia’s economic growth is dominated by the influx of domestic and foreign investments in technology.
Mr Thomas Lembong, the Head of the Investment Coordinating Board, represented President Joko Widodo in the opening of the event. He said that Foreign Direct Investment (FDI) in in Indonesia was dominated by two sectors in the last 4 years, the smelting and the digital economy. He furthered, “The digital economy sector is the saviour of FDI Indonesia. I really hope this continues.”
He mentioned the role that the government plays in ensuring digital sector investment continues is extremely important. He cited two main principles that should be supported by the government: light touch regulation and safe harbour policy.
“Light touch is related to regulation, wherein the government should not interfere and try to regulate everything, allowing innovation to grow in this country,“ explained Mr Lembong. He added, “In the safe harbour policy, the government should be able to create a secure environment for the start-up industry. As policymakers, they should understand that innovation comes from experimentation and failures. They should be able to protect the start-ups when they fail.”
According to the Ministry of Communications and Informatics Minister Rudiantara, the Department has applied light touch regulation, wherein the digital business simply needs to register online and they need not ask for permission again. He affirmed the government's efforts to be a facilitator of digital economic development and said, "The government, especially the Ministry of Communications and Informatics, recognise our role as a facilitator and even an accelerator for the growth of the national digital economy and make Indonesia Digital Paradise, possibly creating the next unicorns.”