Next Shot
    Category: Entrepreneurs By : Ardian Wibisono Read : 1067 Date : Thursday, October 13, 2016 - 11:35:17

    Santirta Martendano for Forbes Indonesia

    Indonesia’s largest telecom firm, state-owned PT Telekomunikasi Indonesia (Telkom) is a pioneer in the country’s Internet sector. Eager to find new revenue due to its core phone business maturing, Telkom established, one of the country’s first online marketplaces, back in 2009. The next year, Telkom also started a music download and streaming firm Melon Indonesia, a joint venture with Korean music streaming firm SK Planet—before Spotify entered the country. However, neither venture gained much momentum, and was overtaken by other startups.

    Now Telkom is trying again, with a different approach. Last year, it established venture firm PT Metra Digital Innovation, known as MDI Ventures, based in Jakarta but with an office in Sunnyvale, California. “Culture is key,” Says Nicko Widjaja, chief executive of MDI Ventures, on how he will bring success to MDI Ventures. He is aware that most corporations, especially state-owned firms, aren’t known for their entrepreneurial culture. lost both Shinta Dhanuwardoyo, an early chief executive, and her successor Andi Boediman, partly because of the culture issue.

    Nicko says Telkom has now willing to adapt to the startup world. Unlike a standalone venture firm, Nicko notes that Telkom has plenty to offer startups, such as market clout and network. Telkom rival Indosat for example has started its own venture and incubator firm, Ideabox. “This is how we convince the startups to take our money. These startups don’t necessarily need money but also a strategic investor that can scale up their business,” Nicko says. “In the startup map of Southeast Asia, we think of ourselves as a bridge for international startups to enter Indonesia’s market, we can invest and build businesses with them.”

    Currently MDI Ventures manages $100 million—all from Telkom—and has investments not just in local but also regional startups. The size of investment varies between $1 to $5 million, with roughly an eight year horizon and a target IRR above 20%. At the moment, the firm has invested in seven companies, as well as running incubator Indigo, with nine firms. The company is also eyeing a couple regional fintech companies. Nicko says MDI Ventures is aiming to increase its assets to $500 million in 2020. “The market is hot, and we’re looking for quick wins as well as big wins,” says Nicko.

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