Behind TipTip, a cohort of operators across audio, OTT video, virtual influencer infrastructure, niche marketplaces, and music distribution are each reaching their own version of working economics, under different mechanisms, at different stages, in different cities. That breadth is what makes this moment different from any prior cycle.

TipTip: the pivot that compounded into a profit

From tipping tool to ticketing infrastructure, a multi-quarter repositioning that most of the market wasn’t watching

The EBITDA print TipTip delivered in Q1 2026 is the visible end of a repositioning that began well before this quarter. The platform that launched as a tipping and community-payments tool now operates as ticketing infrastructure for events and entertainment experiences, a category with structurally higher unit economics than tipping ever offered. Three things drove the result, and each one compounds the next.

Ticketing became the engine. Event ticketing charges organisers on gross transaction value, not on tip amounts — bigger denominator, higher margin per transaction, better operating leverage as volume scales.

AI compressed the cost of running it. TipTip’s demand-prediction system claims over 99% accuracy on ticket-sales forecasting, which means working-capital optimisation for event organisers is now a built-in feature, not an add-on service. Contribution margin grew after deployment. The cost that disappeared was the human underwriting layer that competitors still price for.

Self-serve supply removed the ceiling. By end-2025, more than half of all transactions came from promoters who onboarded themselves. Sales overhead at the marginal unit became effectively zero. The platform scales supply without scaling headcount.

The next leg is SatuSatu, a curated platform for cultural activities, outdoor tours, and workshops running on TipTip’s existing AI ticketing rails, plus a concierge layer combining automation with human support. CEO Albert Lucius framed the thesis in the May 2026 release: real-world experiences become more valuable as digital technologies evolve. SatuSatu is the bet that the fastest-growing GDP segment in Q1 2026 Accommodation and Food Services, up 13.14% is also the next inventory source for a ticketing platform already built to handle it.

The cohort: six categories, one industry

The more interesting story isn’t TipTip alone, it’s what the operators around it are building toward.

What this cohort has in common isn’t funding stage or category, it’s specificity. Each operator has identified a structural advantage narrow enough to defend: Noice in audio and podcasting, where Indonesia ranks second globally for weekly listeners. KaryaKarsa in story and comics with 150K+ creators. Vidio in premium OTT video, where 5M+ subscribers give the platform the scale to commission original content and run creator competitions simultaneously. Bythen in AI content creator video platform, where a founding team with two prior exits (Magnivate to WPP, Bridestory to Tokopedia) is building the picks-and-shovels layer for an influencer market that doesn’t yet need to show its face.

HaluApp is the most instructive case at the bottom of the table. Founded in 2022 in Surabaya, bootstrapped, fewer than 20 people, no paid digital marketing, and running a 10% take rate on a niche ACG marketplace that is cash-flow positive. The point isn’t that HaluApp will become the largest operator in the cohort.

The market gap the second generation is closing

The under-monetisation is real, which means so is the upside

Indonesia is currently a volume powerhouse, moving over IDR100 trillion (~USD6.198 billion) in transactions through sheer scale. The fact that per-transaction value still trails Singapore by 4x reveals a high-velocity opportunity for the next generation of digital operators. With a 39% annual growth rate and the region’s largest creator ecosystem, Indonesia is the ultimate frontier for those ready to turn massive digital engagement into premium economic val

The supporting infrastructure is already in place. Indonesia has 143 million social-media identities, 103 million Instagram users, and a digital ad market worth USD 6.45 billion in 2025. The creator economy market is projected to reach USD 112.7 billion by 2031 from USD 38.5 billion in 2025, a 19.7% CAGR, sitting inside a broader digital economy already near USD 100 billion in GMV. The audience-trust dynamics are structurally favourable: 67% of audiences report higher purchase intent from creators they perceive as genuine, and 86% reward consistency over reach.

What the second generation learned

The playbook changed. The results are following.

The first generation of Indonesia’s creator-economy platforms proved that demand was real. Creators wanted tools. Audiences were willing to pay. But the unit economics didn’t close at the scale those platforms reached, and most were absorbed, stalled, or remained subscale. That wasn’t a failure of the market. It was a failure of the model.

The second generation read the same market differently. Instead of building horizontal tipping or patronage tools for any creator, they went vertical — category-specific, geography-specific, or infrastructure-specific. TipTip went deep into live event ticketing and built AI underwriting on top of it. HaluApp went deep into ACG and built a community marketplace for a niche that mainstream platforms underserve. Bythen went upstream into the infrastructure layer that the next generation of virtual creators will run on.

The structural advantages compound in ways that horizontal platforms don’t. Pricing power holds in niches. AI capability reduces marginal cost. Geographic specificity keeps customer acquisition costs low. These aren’t incremental improvements on the first-generation playbook. They’re a different playbook.

It didn’t happen alone. In the same 90 days, Bukalapak made a deliberate exit from a category it couldn’t win — physical goods — and redirected everything into virtual gaming, where margins are structurally higher and customers return on their own schedule. The EBITDA line turned positive for the first time. Fore Coffee opened outlets in cities its competitors hadn’t entered yet, kept discounts off the table, and grew net profit 60.5% during Ramadan, the hardest quarter on the Indonesian F&B calendar. Blibli deepened its grip on institutional clients until the revenue they generated outpaced what it cost to serve them for the fourth consecutive year.

Below the listed cohort, two pre-IPO companies that most of the market hasn’t looked at closely yet have been running profitably for over a year. Hypefast built one shared infrastructure layer and put multiple brands on top of it, so every new brand makes the whole system more efficient, not more expensive. CARDS embedded itself into the daily financial flows of 700 schools and now earns on every canteen transaction, not just the annual subscription. Neither is waiting for a listing to prove the model works.

Six results in 90 days. Six different operating mechanics. One direction.

GoTo

The fintech layer built inside the platform just outearned on-demand.

The fintech layer GoTo built inside its platform, on top of the users it had already acquired through ride-hailing and food delivery, now produces more EBITDA than on-demand services. Six consecutive quarters of compounding made that possible. No standalone neobank could have replicated the acquisition cost.

WHAT DROVE THE RESULT

• Fintech outearned on-demand: Fintech EBITDA reached IDR 364B (+674% YoY) — the segment’s sixth consecutive profitable quarter. Monthly transacting users: 27.5M (+33%), supporting over 2 billion transactions.

• The loan book scaled without risk creeping in: IDR 9.9T (+59% YoY), credit quality held. GoTo underwrites on transaction history it already owns, not external data.

• On-demand held its ground: EBITDA IDR 439B (+40% YoY), seventh consecutive quarter of improvement, driven by product mix and pricing, not discounts.

• Guidance held flat despite outperformance: Full-year EBITDA target unchanged at IDR 3.2–3.4T, management chose discipline over headline-raising.

Bukalapak

Virtual goods now drive 88% of revenue. The margin followed.

The exit from physical goods wasn’t a retreat. It was a reallocation. Virtual gaming products carry structurally higher margins, require no logistics, and bring customers back on their own schedule. Bukalapak concentrated there, held costs flat, and let the mix shift do the work.

WHAT DROVE THE RESULT

• Gaming became the engine: Itemku and Lapakgaming generated IDR 2,096B — up 90% YoY. Gaming EBITDA more than doubled to IDR 29B (+101% YoY). Virtual goods carry higher margins, don’t require logistics, and customers return on their own schedule.

• Costs held flat as revenue grew: Operating expenses held at IDR 95B while revenue grew 63%. EBITDA turned positive through cost discipline, not a revenue spike.

• Mitra shed its low-margin revenue: Revenue fell 33% YoY but contribution margin improved from 9.2% to 13.1%. What was left was the part dragging returns down.

• B-Money compounding quietly: IDR 22B revenue at 34.3% contribution margin, up 75% YoY.

• Note on reported net loss: The IDR 424B net loss reflects mark-to-market losses on investments including Allo Bank (non-cash, non-operational). Adjusted EBITDA is the cleaner read.

Fore Coffee

Tier-2/3 cities are where the margins are, and Fore Coffee got there first.

The geography was the strategy. Tier-2/3 cities offer lower rent, thinner competition, and customers with fewer premium alternatives, which means pricing power holds. Fore Coffee built its expansion there, kept promotions off the table, and posted its strongest profit growth during the calendar’s weakest quarter.

WHAT DROVE THE RESULT

• Geography drove the margin: Tier-2/3 cities offer lower rent, lower customer acquisition costs, and pricing power that holds. Fewer premium alternatives means customers pay full price.

• Profit outgrew revenue: Net profit +60.5% vs. revenue +52.4% — the marginal outlet earns more than the average. No increase in promotions in Q1.

• Second brand, same infrastructure: Fore Donut opened 5 outlets in Q1 (airports, Bandung, Surabaya) using Fore Coffee’s existing supply chain, store tech, and operations. No separate team, no separate overhead.

• Seasonality didn’t slow it: Ramadan consistently softens Indonesian F&B. Fore Coffee posted 60.5% profit growth inside that headwind.

Blibli

Four consecutive years of take rate expansion. The institutional client is why.

Blibli didn’t grow take rate by charging more. It grew take rate by shifting who it serves and how deeply it monetises them. Institutional clients buy in volume, return on contract, and are more rational on price. Moving more of them onto revenue-generating services is what moved the number, 160 basis points in twelve months, four years running.

WHAT DROVE THE RESULT

• Institutional monetisation moved from 49% to 59%: More of the client base now sits on services that generate revenue, not just transaction volume. Institutional buyers are stickier, more predictable, and return on contract.

• Category mix did the structural work: Gross profit before discounts grew 32% YoY, exceeding revenue growth, because higher-margin categories (smartphones, home & living, institutional procurement) gained share.

• Cost base tightened in the right places: Operating expenses as a share of total payment volume fell from 7.4% to 7.1%, with cuts in advertising and admin, not in customer service infrastructure.

• Physical network serves the ecosystem: 269 consumer electronics stores, 57 Ranch Market locations, 39 Dekoruma centers. Touchpoints that feed loyalty and data, not standalone retail.

The Next Wave: Early Stage Companies Are Building Profit Before the Bell

The pattern extends below the listed cohort:

Two companies at a meaningfully smaller scale have been operating profitably for a year or longer. Both ahead of their listing targets, both through models that get more efficient as they grow.

Hypefast

One infrastructure layer, many brands — EBITDA positive three years before the IPO target.

Most multi-brand operators build each brand separately: separate logistics, separate tech, separate overhead. Hypefast built the platform first and added brands on top. The fixed cost is already paid. Every brand that follows compresses per-brand cost rather than adding to it.

WHAT DROVE THE RESULT

• EBITDA and free cash flow positive since 2024. Three years ahead of its mid-2027 IPO target.

• In-house manufacturing and 10,000+ points of sale across Indonesia reduce marketplace dependency and protect margins.

• ~150 retail operators centralised at HQ run all brands from a single logistics, warehousing, and technology layer.

• AI-enabled direct-to-consumer channels across every brand in the portfolio, on shared tech.

Per-brand cost declines as the portfolio grows. Profitability is structural, not incidental.

CARDS

A school SaaS that earns on every canteen transaction. Rule of 40: 53.1%.

A SaaS subscription covers the base. But CARDS then placed itself inside every financial transaction a school processes — fee collections, canteen sales, daily purchases — and earns a fee on each one. The school isn’t just a subscriber. It’s a transaction venue that renews itself every day.

WHAT DROVE THE RESULT

• Rule of 40 score: 53.1% — combining solid growth with a ~20% net profit margin.

• Transaction-fee revenue: grew 52.8% in 2025 and now contributes ~40% of monthly revenue, generated through SPP payments, canteen sales, and school purchases.

• Gross transaction volume: +94% YoY — daily micro-transactions on a closed-loop system that wouldn’t exist in a pure SaaS model.

• Partner schools: 700+ (+50% YoY), with average students per school up 20.7% — same-store volume growing alongside new additions.

• LTV-to-CAC ratio: 11x — a function of high switching costs and captive daily transaction volume in a low-competition segment (Tier-2/3 cities, pesantren).

The hybrid model earns on the annual contract and on every transaction in between. That’s why a school SaaS is producing a 20% net margin.

The Pattern

These results didn’t arrive together by coincidence. Each company built its operating mechanism quietly, over quarters, sometimes years, before the numbers made it visible. The profitability shown in this 90-day window was earned well before the reporting window opened.

What’s significant is the breadth. This isn’t one sector having a good quarter, or one company finally turning a corner. It’s a ride-hailing app turned super app, an all-commerce platform, an F&B chain, an omnichannel retailer, a multi-brand consumer goods platform, and a school edtech. All moving in the same direction, at the same time, through entirely different means.

GoTo’s IDR 171 billion is one number in a much larger set. The set is what changed — and it’s larger than any single quarter can contain.

Indonesia’s consumer and new retail sector drew USD 130 million in disclosed funding across fifteen rounds in 2025 — more than double the capital that reached healthtech, the second-ranked category across the Startup Report 2026, which closed eleven deals over the same period. That concentration reflects where the ecosystem’s most experienced allocators are placing their highest-conviction positions.

The consumer sector tracked here covers new retail in its broadest form — D2C brands in F&B, fashion, and beauty; aggregators that acquire and scale consumer labels; and omnichannel retailers building presence across both digital and physical channels. The common thread is the end buyer: these are businesses whose growth is determined by repeat purchase, brand recall, and consumer trust rather than by the infrastructure layer serving them.

Several structural conditions underpin that concentration: an e-commerce distribution layer operating at national scale, a logistics network extending well beyond Java, embedded credit infrastructure converting first-time digital buyers in volume, and an investor cohort with direct experience building category leaders in this market.

The Brand-Building Window is Open

The comparison that surfaces most frequently among early-stage investors is not Southeast Asia at large. It is China’s consumer decade.

Between 2012 and 2018, a sustained expansion of China’s middle-class consumption produced a generation of consumer brands across packaged food, cosmetics, and specialty retail that now hold market positions no subsequent entrant has materially matched. The window to establish durable brand recall lasted roughly six years. The brands that moved within it built recall advantages that compounded into structural market positions, and the category leaders that formed in that period remain the dominant names today.

Joshua Santoso, Investment Director at Alpha JWC Ventures, sees the same pattern forming in Indonesia.

Alpha JWC’s early consumer positions across retail, FMCG, and cloud kitchens each now hold category-leading market share, a result of one consistent operating principle: invest before brand equity is priced in. Once one or two brands hold dominant consumer recall, the businesses that have already earned consumer trust are well positioned to sustain it.

The sectors drawing the most capital are consistent with that logic. Retail and F&B, FMCG, wellness, and specialised healthcare are absorbing the largest share of new allocations, on the basis of returns on invested capital consistent with consumer-category benchmarks in comparable markets, repeat consumption patterns, and demand that tracks middle-class income growth.

The most defensible positions, Santoso noted, are not in empty categories. They are in underserved segments within validated ones, won through execution that competitors cannot quickly match.

Capital efficiency has become the primary filter in early-stage evaluation. A 12-to-18-month payback period is the common baseline, and businesses that perform within or below that range draw the most active allocators.

Santoso points to scale as the reason regional expansion is an option rather than a requirement. Indonesia’s consumer market is comparable in size to Vietnam, Malaysia, and Thailand combined.

A 24-Million-Strong Buyer Base is Building Brand Preferences in Real Time

OJK’s end-of-year data shows how quickly that base of new digital buyers has grown. The credit numbers describe why consumers showed up.

Indonesia closed 2025 with 24.52 million active buy-now-pay-later (BNPL) debtors, a 49.23% increase year-on-year. Total outstanding BNPL financing reached IDR 11.94 trillion by December, up 75.05% from the prior year, according to OJK data. The demographic profile of that growth sits with millennials and Gen Z, two cohorts with high digital activity and a structural preference for flexible credit over traditional banking products.

Those figures describe something broader than a fintech category. They represent a class of buyers who are now transacting regularly through digital channels, building credit histories, and developing brand preferences in real time, at a scale that extends meaningfully beyond traditional credit distribution. Abhijay Sethia, Chief Strategy Officer of Kredivo Group, describes the mechanism:

Two numbers describe the network’s current footprint. Kredivo’s offline presence now spans more than 50,000 unique store locations across Indonesia, and its collections infrastructure covers more than 90% of the country’s population.

Outside Tier-1 cities, the credit infrastructure is not displacing existing providers — it is creating demand that had no prior equivalent. Serving that market at scale carries specific operational requirements: local marketing, fraud controls, collections discipline, and transaction economics that hold even at lower average basket sizes. The providers building durable positions are those who have localized for them from the outset.

The 24.52 million buyers now transacting through embedded credit are the same cohort in which consumer brand recall is being established for the first time, making the credit infrastructure and the brand-building window two aspects of one opportunity.

A Consumer Sectors Exit Path has Opened at the Growth Stage

Early-stage venture activity is running in parallel with a distinct movement at the growth and buyout end of the market. The result is an identifiable exit path that previously did not exist at scale.

As of April 2026, according to sources familiar with the fundraise, a former senior partner at a major global private equity firm who led several of its largest Indonesian transactions is raising a new mid-market fund, with an indicated target of USD 100 to 150 million and Indonesia’s consumer sector as its primary focus.

This is not an isolated signal. PE firms in the region are reorienting toward essential sectors like healthcare, financial services, and staple consumer goods. Indonesian founders have been building in these categories for years, through a period when a domestic institutional buyer base had not yet formed at scale.

The buyer base is now forming. Consumer sectors have an identifiable institutional buyer at the growth stage — one that did not exist at scale five years ago.

The criteria PE buyers apply at acquisition — audited financials, OJK-compliant structures, documented unit economics, and a clean ownership structure — are becoming the de facto standard for consumer sectors seeking institutional capital at the growth stage. Businesses that build toward them from the outset are the ones that attract competitive bids.

Indonesia’s macro fundamentals support that timing. GDP growth of approximately 5% remains intact, household consumption accounts for more than half of all economic activity, and middle-income demand for staples and essential services continues to expand ahead of discretionary categories.

The variable worth monitoring is rupiah exposure on imported inputs. Businesses with domestic supply chain optionality carry a structural cost advantage that becomes more pronounced as they scale.

The Brands That Scale are Testing Weekly, Not Quarterly

The arrival of institutional capital at the growth stage raises the standard against which consumer sector will be measured. With the infrastructure conditions now in place, the more demanding question sits at the company level, where the distance between opportunity and outcome is measurable in payback periods, repeat purchase rates, and channel discipline.

TJ Tham, Founder and CEO of Tjufoo, a local brand aggregator, returns to the methodological layer that sits above market selection. The most common gap he observes is methodological rather than market-related. Brands that underperform tend to optimize for individual transactions rather than customer segments, and allocate less to brand equity relative to short-term conversion.

The companies that compound, Tham argues, are built on speed of learning rather than speed of scaling. Testing 30 to 40 pieces of content per month, running weekly experiments on product selection, pricing, and messaging: these are the inputs that produce defensible market knowledge. “If you’re not testing at that pace, you’re basically relying on luck,” he noted.

Channel strategy is where the gap is most visible. Marketplaces operate as conversion environments, lower in the purchase funnel, where intent is already formed. Social media and owned channels build brand recognition at the top of the funnel, where intent is being shaped. Treating marketplaces as brand-building surfaces, or expecting social audiences to convert without an intermediate step, produces results that diverge from the channel’s actual function.

Tham offers a specific readiness benchmark for brands that do choose to expand regionally. Those that have cleared Rp 1 trillion in domestic revenue, built presence across both online and physical retail in at minimum Sumatra and Java, and assembled management capable of running independently of the founding team are in a position to consider it.

The Infrastructure is Built. The Constraint has Moved.

Over the past decade, three conditions have come together in Indonesia’s consumer market that rarely align at the same time: a credit infrastructure with national reach, a venture track record that has produced exits in the category, and an institutional buyer base actively positioning at the growth stage. Each took years to form independently. They are now operating in parallel.

That shift changes where the weight of a consumer sector investment actually sits. Structural risk has narrowed considerably, and product decisions and execution judgment now carry most of that weight. The capacity that once went into navigating infrastructure gaps is now available for building the business itself.

The structural conditions of Indonesian market building continue to evolve — talent development in second-tier cities and the time required for category education among them. What has changed is the baseline from which that work now begins.

The inputs for building a category-leading consumer sector in Indonesia are now in place: credit infrastructure reaching most of the population, exit channels that are active and forming, and investors with direct experience in the category. What follows in any market once its structural conditions are established is determined by the quality of what gets built within them. The consumer market that takes shape over the next cycle will reflect the decisions being made now.

Traceability Has Shifted Where Waste Value Is Captured

Indonesia generates around 70 million tonnes of waste each year, as corporate demand for traceable recycled materials increases with 20 to 40 percent recycled content targets. Waste no longer stops at collection. It is now directed toward buyers who require traceable materials. Extended Producer Responsibility and ESG reporting requirements are turning recyclable materials into inputs that must be proven.

This is where value shifts. It is no longer defined by who collects, but by who controls the flow and owns the data. That demand has translated into repeat transactions, particularly from FMCG and export-oriented companies that require traceable recycled inputs for compliance.

Rekosistem demonstrates this logic in practice. The platform connects households and informal collectors into a single traceable flow, producing compliance-ready documentation for more than 225 corporate partners. This demand from corporate buyers is what drives the platform’s scale to more than 70,000 users and 36 million kilograms of emissions tracked.The data layer, which records material provenance at each handoff, supports compliance documentation for corporates while improving demand stability and pricing for collectors.

The model integrates material value into formal supply chains and produces documentation that meets ESG reporting standards. Demand is driven by compliance. Contracts become clearer. Data becomes monetizable.

Removing Upfront Cost Has Turned Solar Into an Operational Decision

The same commercial logic is reshaping energy procurement. Systems are now installed with no upfront cost and paid through long-term contracts, typically spanning 10 to 25 years, providing price certainty and making the model financially predictable. The decision shifts from capital allocation to procurement.

Under this structure, savings of 10 to 30 percent are achievable without upfront capital, making solar procurement comparable to other operating costs.

With more than 99 percent of technical potential still available, commercial and industrial solar adoption remains at an early stage.

Xurya has deployed more than 300 commercial and industrial solar projects under long-term contracts, with revenue defined through those agreements rather than projections. Each installation also generates a consistent emissions baseline, providing the kind of emissions record that carbon markets will need to price.

Data Is Accumulating. Pricing Will Follow

Companies managing waste generate traceable material data. Companies adopting solar generate consistent energy records. Together, these build the measurement layer that emissions accounting requires.

Indonesia’s carbon economy is projected at $560 billion. As of August 2025, recorded transactions on IDXCarbon totalled around $73,000, consistent with the early formation stage of exchange-based carbon markets elsewhere. At this stage, standards are forming, buyer demand is consolidating, and buyers are still determining which credits they trust.

In markets at this stage, the accumulation of verifiable data shapes participation as standards consolidate. Value is being built through measurement before pricing develops.

What is emerging is a set of interconnected activities, each generating the inputs the next layer requires. Waste generates material flows and compliance data. Solar adoption generates measurable energy use and emissions baselines. From this, emissions can be calculated. As demand develops, carbon becomes the pricing layer that connects them.

External pressure is compressing the timeline across all three layers. Cross-border mechanisms such as the EU’s Carbon Border Adjustment Mechanism are beginning to shape demand, particularly for export-oriented industries. At the same time, supply chain requirements and domestic energy considerations are accelerating the shift.

The record is being written now, and whoever holds it will set the price.

As global macroeconomic conditions shifted, the market underwent a pragmatic recalibration. A period of heightened scrutiny around governance standards and reporting practices across the ecosystem contributed to a shift in investor confidence. Private tech funding consolidated to roughly USD355.7m in 2025, per the Indonesia Startup Report 2026 by Foundry Collective, a contraction from its peak earlier in the decade. The contraction, however, is not evidence of retreat. The ecosystem is undergoing a structural transition, and the terms of that transition are being set at the level of governance infrastructure.

The Shift

The company-level picture has already begun to reflect this. Bukalapak recorded a net profit of IDR3.14trn (trillion Rupiah) for 2025, reflecting a sustained shift toward capital discipline. The GoTo Group reported record adjusted EBITDA of IDR2trn in 2025.

The capital picture follows the same logic. Data from Indonesia’s Financial Services Authority (OJK) shows that total assets held by Indonesian venture capital companies reached a record IDR27.57trn in 2025, while actual disbursements held at roughly IDR15.97trn. This gap has widened consistently since 2022, when disbursements of IDR17.61trn were roughly in step with total assets, marking the closest point of parity in recent years. The Investment to Fund Asset Ratio has moved from 69.29% in 2018 to 57.94% in 2025. The available capital is there. The conditions required to unlock it have changed.

The forensic picture explains why. PwC’s analysis of portfolio companies identifies a consistent gap between paper compliance and operational reality. A startup may present audited financials and formalised procedures and still carry material risks beneath the surface because misrepresentation, whether by design or by oversight, can work around standard control mechanisms rather than trigger them. In the B2B and fintech sectors, rapid growth has blurred the boundary between lending and supplier credit, producing financing structures where the boundary between debt obligations and equity position becomes difficult to verify from outside the company.

Several patterns recur across these cases: unusually rapid profitability relative to sector peers, consistent negative cash flows alongside reported revenue growth, significant transactions with related parties lacking independent review, and sudden spikes in receivables ratios that point to premature revenue recognition.

Taken together, these signals indicate that complexity is outpacing the infrastructure built to manage it, a condition that data from PwC’s Global Compliance Survey 2025 confirms at scale. Some 85% of organisations report compliance has grown more complex over the past three years, 63% cite disaggregated data as their primary operational challenge, and 56% report poor data quality. Regulatory complexity drives data fragmentation, and fragmented data is where financial misrepresentation goes undetected.

Addressing this, Maman Firmansyah, Director of Supervision for Financing Institutions and Venture Capital Companies at OJK, noted that governance is the first pillar of industry health, and that weak governance at the start makes downstream risks unavoidable. Sacha Winzenried, Director at PwC Indonesia, noted that as the industry develops, embedding robust risk management early protects both portfolio value and market reputation.

Capital deployment velocity is now directly conditional on governance infrastructure maturity. The gap between assets held and capital deployed is where that condition shows up most directly in the data. The demand for rigorous, scalable oversight is the market response.

Governance as Infrastructure: The Maturation Map

The demand for stricter oversight creates a practical tension. Early-stage founders commonly view enterprise-grade risk management as a constraint on the speed that early growth requires. Recognising this, the Startup Maturation Map was developed in collaboration with venture capital associations across Southeast Asia, including those from Singapore (SVCA), Malaysia (MVCA), Thailand (TVCA), and Vietnam (VPCA). The framework installs controls incrementally, calibrated to each stage of a company’s development rather than applied as a single mandate.

Eddi Danusaputro, Chairman of AMVESINDO, framed the stakes plainly. In the midst of economic uncertainty, governance and risk management are key not only to business survival but to ensuring the industry can support sustainable innovation.

The Regulatory Layer

The Maturation Map sits within a broader regulatory shift that reinforces its logic from above. POJK 48/2024 on good corporate governance extends its mandate to venture capital companies directly. Under the financial services institution definition in the regulation, venture capital companies are covered as regulated entities. This makes the obligation binding on capital allocators, not only on the companies they back. According to ACFE 2024 global data, anti-fraud policies of the kind now required under POJK 48/2024 are associated with a 50% reduction in median fraud losses among implementing organisations.

Indonesia’s digital economy is growing, in scale, in discipline, and in the institutional architecture required to sustain both. The market fundamentals are intact, the consumer base is expanding, and the venture capital reserves are substantial. What has changed is the condition under which that capital moves. Governance infrastructure is now the variable that determines deployment. Among major emerging digital economies, Indonesia is one of the few where that correlation has been made explicit by both market behaviour and regulatory mandate at the same time. That is the basis on which the next phase of growth will be built.

What this quarter makes clear is not that the ecosystem has stalled. It is that the conditions defining the next cycle are already visible and they are taking shape across multiple layers of the digital economy at the same time.

Public Markets Are Pricing Indonesia's Consumer Tech on a New Standard

The measure by which Indonesian consumer tech is being valued has shifted — away from theoretical market size and toward actual cash generation. The latest public market data makes this visible. GoTo Group delivered a full-year adjusted EBITDA of IDR2 trillion for 2025, outperforming its prior guidance and projecting up to IDR3.4 trillion for 2026. Bukalapak narrowed its adjusted EBITDA losses to IDR62 billion, operating at effective break-even while holding IDR16.21 trillion in cash.

These are not isolated company achievements but data points in a broader market-level shift where ecosystem integration compounds the effect. When financial products are placed directly inside the daily transaction flows of ride-hailing and e-commerce, customer acquisition costs approach zero. The embedded model earns from users the platform already has rather than paying to find new ones. Bank Jago’s 115% increase in net profit to IDR276 billion was anchored by exactly this structure, through its embedded position within the GoTo ecosystem.

The IPO pipeline is being reshaped accordingly. Institutional capital is allocating toward platforms that monetise existing users rather than those deploying capital to acquire new ones. Traveloka’s reported net profit of USD37.7 million and Kopi Kenangan’s profitability at a USD180 million revenue base reinforce this as a sector-wide condition. Embedded finance and operational discipline are the mechanisms through which scale is being converted into defensible margins.

Healthcare Capital Is Moving Toward the Physical Layer

Post-pandemic capital allocation in Indonesian healthcare has reoriented. Early investment into asset-light telemedicine and health applications has given way to targeted positions in physical secondary care and administrative infrastructure, a reallocation that reflects where the system’s structural gaps sit and where foreign and regional capital sees the more durable opportunity.

The numbers point to where the gaps are. West Java, a province of nearly 52 million people, has a hospital bed density of 0.85 beds per 1,000 people, below international benchmarks. When the physical infrastructure cannot handle the volume, expanding digital access at the front end has limited effect.

Sweef Capital’s strategic investment in Avisena Healthcare Group, a four-hospital network targeting this capacity gap, addresses the referral bottlenecks that persist within the BPJS Kesehatan system at the infrastructural level rather than at the digital interface.

The administrative layer tells a parallel story. TelkomGroup’s divestment of AdMedika to Singapore-based Fullerton Health, in a deal reportedly valued near USD100 million, integrates Indonesia’s largest claims management administrator into a regional network processing over 14 million healthcare transactions annually. The transaction addresses the claims processing architecture at scale, the layer of the system that determines whether digitised healthcare access can function at volume.

What the capital flows in this sector are showing is a market-level recognition: the gap between digital healthcare access and physical healthcare capacity is where the structural opportunity sits. It is the same logic visible across the broader ecosystem with capital moving toward structural depth over surface-level growth. Investment that bridges those two layers, whether through physical bed expansion or administrative consolidation, is where capital is finding defensible ground.

The Fintech Playbook Is Now an Export

Indonesian fintech built its model under pressure, competing for customers in one of Southeast Asia’s most crowded domestic markets, with thin margins and high acquisition costs. The embedded finance structure that emerged from that environment is now generating real returns. And as the domestic credit market matures, the same playbook is being taken abroad.

Domestically, the embedded finance model is generating results. Superbank posted a pre-tax profit of IDR143.3 billion for 2025, a turnaround driven by a 160% increase in net interest income, and moved up to the KBMI 2 classification, reflecting stronger capital reserves and operational scale.

The domestic credit picture is maturing alongside this. Outstanding BNPL balances reached IDR37.44 trillion by late 2025, with banking-based non-performing loan rates at 2.04% and multi-finance at 2.73%. Consumer purchasing power remains under pressure from inflation, and the domestic credit market is approaching the natural limits of its current growth cycle. It is this maturation that explains the sector’s outward movement.

The embedded finance playbook, stress-tested in one of Southeast Asia’s most competitive domestic markets, is now the asset being exported. Kredivo Group’s acquisition of a 100% stake in Timo, Vietnam’s pioneering digital bank, is the clearest expression of this. Backed by USD100 million in recent funding and committing USD15 million in fresh investment over three years, Kredivo is replicating a model that has already demonstrated its viability at home. Vietnam is not a new experiment. It is a proven model entering a new market.

The domestic payment architecture is connected with global rails in parallel. DOKU’s partnership with Ant International extends the reach of Indonesia’s payment infrastructure into the broader Asian cross-border ecosystem, giving local merchants direct access to cross-border transaction flows without requiring new infrastructure built from scratch. As domestic credit conditions mature, the operational models built under that pressure become the basis for regional expansion. Indonesian fintech is transitioning from a recipient of cross-border capital to an exporter of cross-border platforms.

Regulation Is Being Built to Last

The instinct when reading a wave of new regulation is to ask what it is stopping. The more useful question, in Indonesia’s case this quarter, is what it is building.

The measures introduced in Q1 2026 are not a single policy response to a single problem; they are the components of a regulatory architecture being assembled in parallel across different parts of the digital economy.

Government Regulation No. 17 of 2025, which prohibits children under 16 from accessing designated high-risk digital platforms, came into enforcement on March 28, 2026. The regulation places compliance responsibility on the platforms themselves, requiring age-verification mechanisms and default privacy settings. By the enforcement deadline, X and Bigo Live had met the requirements in full. TikTok and Roblox demonstrated partial compliance. Meta and YouTube had not met the government’s standards. The government has established access termination as the enforcement mechanism for continued non-compliance and has initiated technical audits across platforms. Indonesia joins Australia among the jurisdictions that have moved from policy discussion to active enforcement on platform access and age safety.

The capital markets picture follows the same logic. The OJK and IDX are requiring approximately 140 publicly listed companies to meet a new 15% free float threshold within the first year of implementation. The measure is designed to reduce ownership concentration and align Indonesian listings with global index standards including MSCI. The share sales required to meet this threshold are estimated at IDR187 trillion. For companies unable to meet the requirement, the OJK has established a formalised delisting pathway. The policy introduces quantifiable implications for listings where ownership concentration has historically been high.

The enabling side of the regulatory posture is equally deliberate. The appointment of Friderica Widyasari Dewi as the new OJK chairperson signals institutional continuity with an active orientation toward digital innovation. The joint launch of the Digital Innovation Center (PIDI) by the OJK and Bank Indonesia makes this concrete through a supervised regulatory sandbox that allows fintech experimentation, including within digital assets, while maintaining consumer protection standards. Enforcement and enablement are operating in parallel, which is what distinguishes a regulatory architecture from a regulatory constraint.

Taken together, these measures describe a state that is setting the structural conditions of the market rather than responding to outcomes after the fact. Compliance is now a market filter, and the costs of non-compliance, whether for a global platform or a domestically listed company, are becoming quantifiable.

The Shape of the Next Cycle

What Q1 2026 describes is a single compounding movement visible from four different angles. The embedded finance model that drove Bank Jago’s profitability is the same playbook Kredivo is deploying in Vietnam. The capital discipline that brought GoTo to positive EBITDA is the same standard institutional investors are now applying to the IPO pipeline. The regulatory architecture tightening platform compliance and capital market structure at home is raising the floor for every participant in the next cycle.

These are not parallel developments; they are the same market recalibrating around a more durable set of operating conditions. The previous cycle was defined by scale. The next will be defined by whether that scale was built on something real.

The structural opportunity for decarbonization begins with the scale of Indonesia’s industrial base. Renewables currently account for approximately 14 percent of Indonesia’s primary energy mix. This measure differs from the electricity generation mix but reflects overall energy use across sectors. The concentration of demand within the manufacturing sector provides a clear path for rapid scaling. Official data from the Ministry of Energy and Mineral Resources indicate that industry represents 45.9 percent of total energy demand, nearly four times the share of the residential sector. This disparity means that efficiency gains within industrial estates offer the most immediate and scalable impact for the nation’s energy transition.

According to the Just Energy Transition Partnership (JETP), around 75 percent of Indonesia’s industrial captive power capacity remains coal-based. Another 11 GW of captive projects are in the pipeline, with a majority still expected to rely on coal. The scale of industrial demand makes factories, rather than households, the logical starting point of Indonesia’s energy transition.

When Energy Becomes a Strategic Variable

For export-oriented manufacturers, the cost of carbon is no longer theoretical, it is already determining who remains competitive in global markets. The integration of domestic renewable energy provides a structural pathway toward long-term price certainty and increased energy independence. Currently, Indonesia’s Domestic Market Obligation (DMO) caps coal prices at around US$70 per tonne, significantly lower than global market fluctuations that ranged between US$130–US$140 as of 2024. While this policy stabilizes domestic electricity tariffs in the short term, it also suppresses immediate incentives for renewable adoption. At the same time, it reinforces the strategic rationale for renewables as a long-term hedge against future commodity price volatility should such protections be reduced or removed.

Beyond direct costs, global trade dynamics are now redefining industrial strategy. Export-oriented sectors such as nickel, steel and manufacturing now face mounting external carbon constraints. The European Union’s Carbon Border Adjustment Mechanism (CBAM) and similar regulatory trends effectively price embedded emissions into traded goods. For producers integrated into global supply chains, electricity sources are no longer a domestic policy issue but a competitiveness variable. Carbon intensity now travels with the product.

Financing conditions are evolving in tandem with these trade regulations. International lenders and institutional investors now routinely attach ESG-linked covenants to capital access. International lenders now routinely embed ESG performance conditions into financing structures, with borrowing terms that adjust depending on whether sustainability targets are met or missed. Projects with high carbon exposure may face elevated risk premiums and limited funding options. Renewable energy, then, does double duty: it keeps export doors open and borrowing costs down. This shifts the corporate calculus from a simple comparison of short-term tariffs to a broader focus on long-term balance sheet resilience.

For industrial users, energy stability matters as much as price. While renewable energy requires higher initial capital expenditure, it offers a predictable operating cost structure and greater long-term price stability compared to the commodity cycles associated with fossil fuels.

Commercial viability data supports this direction. A techno-economic study of rooftop photovoltaic systems finds that commercial users achieve annual savings of around 23 percent, compared with roughly 16 percent for households. Solar can cover up to 30 percent of commercial daytime loads, against approximately 22 percent in residential settings. Larger scale and better alignment between operating hours and generation cycles improve the returns further. The evidence points to industrial estates, rather than households, as the primary source of near-term decarbonisation gains. For manufacturers weighing the switch, the numbers make the case on their own terms.

Consider an export-oriented manufacturer in East Java. Its largest European buyer has begun factoring CBAM-related costs into procurement decisions. With EU carbon prices averaged roughly €60–70 per tonne of CO₂ in 2024, based on market estimates and European Commission reporting, the carbon intensity embedded in every product now carries a measurable and growing price tag. For Indonesian exporters without domestic carbon pricing, that liability falls in full on their balance sheet. Its international lender, meanwhile, is attaching ESG-linked covenants to new financing, making carbon exposure a measurable cost of capital. And the domestic coal price cap that has kept electricity relatively inexpensive remains subject to policy revision.

None of these pressures arrives with a fixed deadline. But they are already appearing on the same balance sheet, moving in the same direction, at the same time. For a manufacturer making a ten-year energy decision, that convergence is increasingly part of the calculation. The shift is not being driven by policy alone. It is being priced into the balance sheet.

How The Industry is Adapting

The clearest signal that industrial actors have begun to internalise these pressures comes not from policy announcements, but from procurement decisions. Unilever Indonesia, which operates multiple manufacturing facilities across the country, offers a useful illustration. Facing mounting pressure from its global parent to decarbonise operations across its supply chain, the company moved beyond corporate commitments into concrete infrastructure.

In 2023, it commissioned one of the largest rooftop solar installations in the Jababeka industrial estate in Cikarang, with a combined capacity of 2.5 MWp across two factories. The project is projected to cut CO₂ emissions by around 1,500 tonnes per year. For a company whose buyers and investors scrutinise the carbon intensity of every product, energy sourcing has become a condition of doing business, not a footnote. Unilever’s move is one now being replicated across Indonesia’s export-oriented manufacturing base: that meeting ESG requirements now is cheaper than losing contracts later.

What is changing is not just who is adopting solar, but how. Rather than purchasing assets outright, manufacturers are shifting toward service-based arrangements that remove the capital barrier entirely. Firms such as Xurya offer Power Purchase Agreements and no-down-payment leasing schemes under which factories pay only for electricity generated, while design, installation and maintenance are handled externally. The implication is significant: renewable adoption no longer requires a manufacturer to think like an energy company. It requires only that they think like a buyer.

Beyond rooftops, a parallel shift is under way in how factories source heat and process energy. Agricultural residues such as rice husks, palm waste, and sugarcane bagasse once represented a disposal problem. Manufacturers with access to biomass feedstock now treat them as a fuel hedge. Firms such as Octayne Green have built businesses around this logic, converting waste streams into usable industrial energy. The broader signal is that Indonesia’s industrial energy transition is not converging on a single technology. It is assembling itself from whatever is cheapest and most available. In a country that generates biomass at industrial scale, this calculation increasingly includes materials that were once thrown away.

In practice, this turns renewable energy from a sustainability initiative into a financial strategy, one that stabilises costs, preserves market access and improves access to capital.

From Adoption to Advantage

The scale of industrial energy demand is not only reshaping how companies source power, it is also reshaping where renewable infrastructure gets built. The Cirata floating solar plant in West Java is a case in point. With a capacity of 192 MWp, it was designed to deliver utility-scale renewable power without competing for land, as a direct response to the scarcity created by industrial concentration in the region. Less than 5 percent of the reservoir surface is used. The floating design is less a novelty than an engineering response to a constraint. It is an engineering answer to a resource constraint that conventional solar cannot solve on land already spoken for by factories and logistics.

The output bears out the rationale. In its first year of operation, Cirata generated roughly 267 GWh of electricity while avoiding around 214,000 tonnes of CO₂ emissions annually. By integrating solar output with existing hydropower, the plant also improves system stability. Solar supplies daytime load, while hydropower provides balancing capacity. What Cirata demonstrates is not simply that large-scale renewables are technically feasible in Indonesia. It is that industrial-scale demand is now the force reshaping where and how renewable infrastructure gets deployed.

While the industrial momentum is clear, the pace of transition continues to be influenced by the broader regulatory landscape. Indonesia’s coal price cap keeps fossil-based electricity relatively inexpensive. Furthermore, the National Energy Council has proposed revising the 2025 renewable energy target from 23 percent to around 17 to 19 percent. Concurrently, additional captive power projects remain largely coal-based, and decarbonising the captive power sector alone could require around US$31 billion by 2030 and as much as US$92 billion by 2050. This scale of investment also points to where the transition is most likely to take hold first.

Contrary to public discourse that often focuses on the residential sector, data indicates that the industrial sector is the primary engine of change. Industry consumes nearly half of Indonesia’s total energy demand, offering a scale where efficiency gains compound far more rapidly than at the household level. Taken together, these dynamics point to a shift in where and how Indonesia’s energy transition is likely to take shape.

In Indonesia, the energy transition has found its most credible advocate not in climate policy, but in the profit motive. When factories move, they move at scale. In Indonesia, that is where the energy transition will be decided.

The pattern is one of steady compounding. Business discipline is improving. Capital is becoming more selective. Regulation is moving toward enabling rather than restricting. Each development is incremental. Their direction is consistent.

Consumer Tech: The Profitability Cohort Takes Shape

Several Indonesian consumer brands are hitting the same milestone at the same time. Companies that found their footing two or three years ago are now demonstrating, at scale, that their business models actually work.

The potential for technology-enabled retail to generate sustainable cash flows at scale is no longer theoretical. At a revenue base of roughly USD184m, a coffee-chain leader like Kopi Kenangan has demonstrated that the model can turn profitable in a market of 270 million people. Profitability at this scale confirms a model that was once only aspirational. Technology-enabled consumer retail, operated with discipline in a market with substantial population density, can generate sustainable cash flows. For investors who questioned whether the unit economics were real, this is a direct answer.

Jago Coffee’s reported Series B of around USD12.5m, led by BEENEXT, and Green Rebel Foods’ USD12.5m raise occupy a different point on the maturity curve, but the capital is making a similar bet. Execution quality in the consumer segment is now the differentiator, not category novelty. Hypefast, meanwhile, is building toward a 2027 IPO as an integrated retail infrastructure player, which suggests its investors believe the public markets will reward that model by then.

The counterpoint is instructive. BeautyHaul, parent of Somethinc, is exploring a partial or full sale, with Peak XV Partners and Prosus Ventures evaluating their positions. Strong product-market fit and brand equity have not insulated the company from the broader shift in venture capital toward profitability-first underwriting. The situation illustrates that even category leaders need to adapt when the capital environment changes. Strategic optionality, defined as knowing what options are available and when to exercise them, is increasingly part of how boards and founders need to think about company positioning.

Taken together, the cohort tells investors something useful. Quality of growth is being priced differently than growth itself. That is a healthier signal than the alternative.

Food Delivery: Structural Depth, Not Just Scale

Indonesia’s food delivery sector reached USD6.4bn in gross merchandise value in 2025, according to Momentum Works estimates. The more significant story sits in what is driving that number.

The expansion of food delivery in Indonesia is not primarily a platform story. It is an SME story. Warungs, home-based kitchens, and local brands are now operating at national-scale visibility through delivery apps, converting Indonesia’s culinary diversity into a repeatable digital asset. The resilience of that demand base, distributed across hundreds of thousands of micro-merchants rather than concentrated in a handful of brands, is what makes food delivery a structurally different business in Indonesia than in most markets.

For investors, the implication is that platform GMV here is anchored by a broad base that does not evaporate in a macro downturn the way discretionary consumer spending does.

Content-as-Commerce: Maturing Monetization and Regional Adoption

Social commerce in Southeast Asia has evolved into a sophisticated marketplace ecosystem where content and transaction are fully integrated, as evidenced by a 94% year-on-year increase in global GMV for platforms like TikTok Shop. TikTok Shop recorded a global GMV of USD64.3bn in 2025, with the United States as the largest single market at USD15.1bn. Indonesia was close behind at USD13.1bn, with 111% growth, the highest rate among major markets.

Southeast Asia as a whole contributed USD45.6bn, roughly double the prior year. Malaysia grew 132%, Indonesia 111%, and Thailand 101%. Within the platform, live commerce grew from 10% to 14% of GMV, marketplace increased from 32% to 36%, while video’s share fell from 58% to 50%. This reflects a maturing monetisation mix rather than dependence on a single channel.

One figure worth noting is that Indonesia’s GMV is nearly equivalent to the United States in a market with substantially lower per-capita income. Rising incomes and deeper logistics infrastructure will continue to expand the addressable market from here. What the current numbers confirm is that content-as-commerce has found genuine product-market fit in Southeast Asia, with Indonesia among its most active markets.

Green Technology: Steady Capital in a Cooling Market

Overall startup funding in Southeast Asia has declined from its 2021 to 2022 peak. Green technology has not followed. Climate tech and the combined energy and mobility segment account for an estimated 10 to 15% of total funding value in the region, or USD700m to USD1bn, with 8 to 12% of deal activity. The year-on-year movement in those figures is notably flat, which in the current environment is a form of outperformance.

The integration of climate risk into corporate strategy is driving a shift toward battery-swapping infrastructure and electric mobility solutions. Companies like SWAP represent the initial deployment phase of this hardware-heavy transition. The explanation is structural, not cyclical. Long-term energy transition commitments, government co-investment frameworks, and the integration of climate risk into corporate strategy are creating demand for green capital that is less sensitive to interest rate environments than consumer or fintech investment. Indonesia’s position as a resource-rich economy with substantial renewable energy potential and a growing manufacturing base means the country is both a natural laboratory and a credible deployment destination.

The bar for quality in green tech is high. Investors are underwriting companies with measurable decarbonisation pathways and viable unit economics, not impact narratives. Founders in this space should treat that as useful information. The capital is there and it is patient, but it requires discipline of the same kind that is repricing consumer tech right now.

Private Credit: Filling the Gap Between Equity and Debt

The Indonesian capital stack is maturing to include a middle-tier of financing that supports M&A and inorganic growth for companies past the early venture stage. Recent strategic moves by firms like Qverse to expand into private credit illustrate this shift toward more complex, non-dilutive capital instruments. Qverse, an Indonesian venture debt firm, announced in February 2026 a strategic expansion into private credit alongside a new Singapore office. The shift broadens its mandate to larger funding tickets and M&A-oriented capital structures, moving beyond its original focus on venture debt toward instruments that support inorganic growth.

This is worth watching not for Qverse specifically, but for what it represents in the broader financing landscape. Companies at the scaleup stage, past seed and Series A and not yet near IPO, frequently require capital that sits between traditional venture equity and bank debt. Equity dilutes at the wrong moment. Bank debt requires collateral and covenants that fast-growing companies cannot easily satisfy. Private credit, structured correctly, fills that gap.

Several debt-focused firms in Southeast Asia are making similar moves. The pattern suggests the region’s capital stack is maturing and that the menu of financing instruments available to founders is expanding beyond the binary of VC equity and bank loans. For founders navigating a growth stage without a clear path to the next equity round, that expanded menu has practical implications now.

Semiconductor Design and the Strategic Workforce Mandate

Indonesia’s move up the technology value chain is increasingly focused on high-value intellectual property development in the semiconductor space. The recent 15,000-engineer training initiative signed between Danantara and Arm Limited signals a transition from simple skills transfer toward domestic chip design capacity. On 23 February 2026, President Prabowo Subianto attended the signing of the cooperation agreement between Danantara and Arm Limited in London. The partnership centres on training 15,000 Indonesian engineers in semiconductor design, with a focus on automotive, IoT, data centres, autonomous vehicles, and quantum computing.

The ambition addresses a real gap. Semiconductors underpin every advanced technology sector, and building a domestic pipeline of chip design talent is a logical priority for an economy aiming to move up the technology value chain. The focus on intellectual property development, rather than just skills transfer, indicates the intent is to create durable assets.

As with any large-scale workforce initiative, execution will determine the outcome. Agreements of this scope involve extended timelines, inter-institutional coordination, and the challenge of building competitive technical depth in a globally specialised field. The signing establishes direction. Progress will be worth tracking as training programmes get underway and the first cohort of engineers begins working within the Arm ecosystem.

Governance and Capital Markets: Why The Reset is Constructive?

Recent capital market turbulence and regulatory scrutiny are prompting a constructive response from Indonesia’s market institutions.

OJK, IDX, and KSEI are accelerating reforms around market integrity, reporting standards, and oversight mechanisms, in part as a direct response to feedback from global index providers including MSCI. The intent is to raise governance standards in ways that improve Indonesia’s standing with institutional investors over time. Markets with stronger oversight frameworks tend to attract deeper and more stable participation from international capital.

The practical implication for listed companies and late-stage startups is sharper than it might appear. Boards and founders are being asked to formalise governance structures that were previously optional. In a market where many technology companies remain founder-led, this is a meaningful shift. The willingness to build institutional controls is increasingly a signal to investors. It is not a concession to bureaucracy, but a prerequisite for the kind of capital that supports sustainable scale.

Regulation as Architecture, Not Enforcement

Bank Indonesia is reinforcing the payment systems industry through ICT-based regulatory reform under the Indonesia Payment System Blueprint 2030 and the P2P Law. New regulations taking effect from March 2026 are designed to ensure resilience and security in a digital payment ecosystem that is growing faster than most of its predecessors. The central bank is pairing those rules with industry capacity building and cross-sector coordination, a combination that suggests it understands the difference between writing rules and building systems.

Otoritas Jasa Keuangan has issued POJK No. 30/2025 and SEOJK No. 34/2025 to strengthen governance, risk management, and business planning across technology-based financial innovation and digital financial asset sectors. These rules take effect from July 2026. For fintechs and digital asset platforms, the message is clear and, for the most part, fair. Growth is welcome; it must rest on controls that can withstand scrutiny.

The pattern across both regulators is deliberate. Indonesia is not trying to slow its digital economy. It is trying to make it harder to break. For global investors assessing the risk framework, that distinction matters more than any individual rule.

What The Last Two Weeks Add Up To

The developments of the past fortnight are individually incremental. A profitability milestone. A consistent funding theme in green tech. A broadening capital stack with private credit entering the picture. Regulatory frameworks being tightened in ways that support long-term confidence. A workforce agreement with meaningful upside if executed well. Platform GMV that confirms the durability of digital consumption habits.

Together, they describe an economy where the conditions for durable growth are being put in place with more consistency than at any prior point in Indonesia’s digital economy cycle. That consistency is a meaningful signal.

Indonesia’s startup ecosystem transitioned into a sophisticated phase of institutional discipline in 2025. While a top-line funding total of USD 355.7 million across 91 deals highlights a leaner capital environment compared to the 2021 peak, it more accurately signals a market successfully recalibrating around the enduring gravity of fundamentals. The Indonesia Startup Report 2026 peers beneath the headline numbers to reveal a landscape of focused innovation and strategic depth that is just beginning to unfold.

Selective Capital, Strong Confidence in Growth-Stage Companies

The composition of 2025’s deal flow reveals more than the total. Later-stage rounds absorbed a disproportionate share of deployed capital, while 67 percent of transactions occurred at pre-seed and seed level, a distribution that, on the surface, looks familiar. What’s changed is what sits behind it: a funnel that now compresses at every subsequent stage, with founders demonstrating product-market fit before capital scales with them. How that progression played out across stages tells a more complete story.

Eight debt transactions appeared in the year’s data. That number is modest; its implications are profound. Debt financing requires cash flow visibility that equity does not, and the subset of companies accessing it in 2025 reached a threshold that speaks to growing financial maturity across select parts of the ecosystem. What that signals about the broader trajectory warrants closer examination.

Core Sectors Continue to Attract Capital

Investor concentration in 2025 followed the logic of monetization. New Retail, Fintech, and E-commerce attracted the largest share of capital not because of narrative momentum, but because each demonstrated that Indonesia’s consumer base converts at scale with defensible unit economics. The companies drawing larger checks shared a specific profile: one where margin control is structural rather than dependent on external support. The report maps what this profile looks like in practice and what it implies for how the sector evolves from here.

Fintech’s continued relevance rests on a regulatory shift as much as a commercial one. As frameworks around digital lending, payments, and bank partnerships have become more defined, the risk profile of deployment has moved from exploratory to structural. Indonesia’s financial regulators have tightened licensing requirements and capital thresholds for fintech operators, forcing weaker players out while giving institutional investors greater clarity on compliance and governance expectations. The result is a market where capital increasingly concentrates in platforms able to operate within a regulated framework and demonstrate sustainable lending or payments economics. Capital following clearer rules behaves differently than capital preceding them, and the 2025 flow data reflects that shift in ways the headline figures do not fully capture.

Artificial intelligence registered not as a standalone sector, but as an operational layer embedded across verticals. Applied AI generating leverage across categories with proven demand is a more grounded thesis than AI as a valuation driver alone. How Indonesia’s market is tracking that distinction and where the most durable applications are emerging is one of the more consequential threads of the full report.

Exit Environment Matures with M&A Leading

The ratio of fourteen M&A transactions to three IPOs is perhaps the year’s most structurally significant data point. It signals the maturation of a functional liquidity pathway that operates alongside public markets, offering a pragmatic alternative to the traditional listing. How active that M&A channel was, which sectors drove it, and what it means for exit planning going forward are questions the aggregate number can only introduce.

Where IPOs did occur, the profile had shifted. Companies listing in 2025 generally demonstrated profitability or credible earnings visibility alongside governance standards closer to regional benchmarks. The quality of listings strengthened a development that reflects the market’s growing emphasis on fundamentals over volume.

A Stronger Foundation for Long-Term Growth

The data reveals that 2025 was not a year of retreat. It was a year of concentration of capital finding fewer, better targets; of exit pathways diversifying; of governance expectations rising to meet institutional standards. The conditions being established now have a bearing on what the next cycle looks like.

Indonesia’s underlying fundamentals remain intact. What is being built on top of them, cycle by cycle, is the institutional layer that determines whether those fundamentals eventually compound or simply persist. The full report provides the space these questions deserve, offering a definitive map of a market in transition.

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That concentration of both problem and opportunity in a single vehicle category defines the shape of the transition ahead. For a government that spent roughly USD 45 billion on energy subsidies in 2024 weighted heavily toward fuel imports, the electrification of two-wheelers carries macroeconomic weight alongside environmental intent. Reducing dependence on imported petrol addresses budget exposure to oil price volatility while creating the conditions for domestic industry to develop at scale.

The economic logic has begun to shift. In 2024, Indonesia's battery electric vehicle sales rose 151% year-on-year. Electric two-wheeler sales crossed the 100,000-unit threshold for the first time. By 2025, overall EV sales penetration reached 15%.

The Regional Race and a Distinct Policy Path

The regional context sharpens the picture. Southeast Asia is advancing past legacy automotive markets in EV adoption, and the composition of that growth varies considerably across markets.

Vietnam leads the region with a 40% EV sales penetration, driven in part by a licensing framework that exempts low-capacity scooters from registration requirements, putting electric mobility within reach of students and first-time riders and anchored by a dominant domestic manufacturer in VinFast. Thailand sits at a 21% EV penetration rate, where import tax reductions and direct subsidies have broadened the affordable segment. Further afield, India's market saw 1.95 million EVs sold in 2024, with 94% of those being two and three-wheelers, supported by the government's USD 197 million manufacturing subsidy programme.

Indonesia has chosen a path that is structurally distinct from its neighbours. As part of a longer-term industrial strategy, the government has transitioned from direct cash subsidies to a value-added tax (VAT) discount tied strictly to local manufacturing. Under this scheme, electric two-wheelers meeting a 40% Domestic Component Level (TKDN) threshold qualify for a 10-percentage-point VAT reduction. This mechanism links adoption growth to industrial capacity, with an eye toward building an industry that outlasts the incentives themselves.

The Upstream-Downstream Divide

The structural opportunity in Indonesia's EV market lies in the distance between its upstream strength and its downstream potential.

Upstream, the country is converting its nickel reserves into industrial capacity: gigawatt-scale facilities are operational, with joint ventures between major automotive and energy storage players, including a USD 1.1bn facility in West Java capable of producing 10GWh of cells annually, anchoring a domestic supply chain. Downstream, public charging infrastructure remains in its early stages, with approximately 4,700 stations in operation as of late 2025 against a government target of 63,000 by 2030. That gap represents the most active frontier for investment and innovation in the market today.

Domestic operators are developing hardware and service models shaped by Indonesia's urban density and logistics requirements. The approach favours modular solutions, battery-swapping networks among them that can scale incrementally alongside the expansion of public charging infrastructure, rather than requiring it as a precondition.

Local Operators, Local Solutions

Much of the active development in Indonesia’s electric two-wheeler market is coming from domestically grounded operators building solutions that require deep local knowledge. Their operational execution illustrates how specific structural issues are being addressed:

Hardware Localization: Maka Motors

The enforcement of the TKDN framework has encouraged a shift from the simple rebadging of foreign kits toward domestic engineering. Maka Motors, founded by ride-hailing veterans, exemplifies this transition. By prioritizing research and development tailored to local infrastructure specifically vehicles designed for the high-humidity and varied road conditions of Indonesian urban centers, the firm has focused on localized R&D to ensure proprietary engineering. This approach suggests that domestic industry can be built on a foundation of specialized hardware rather than imported components.

Decentralized Energy: SWAP Energy

Infrastructure development is also shifting toward decentralized energy networks to bypass grid limitations. SWAP Energy operates a network of over 1,300 battery-swapping stations across 14 provinces, addressing the primary barrier of charging downtime for commercial riders. By utilizing data-driven optimization for station placement and maintenance, the firm has achieved a level of operational efficiency that allows for profitability without a primary reliance on state subsidies. The model indicates that Battery-as-a-Service (BaaS) is a commercially viable alternative to traditional plug-in charging in dense urban environments.

Commercial Fleet Electrification: Dash Electric

The Business-to-Business (B2B) segment is currently the primary catalyst for market growth, driven by the logic of Total Cost of Ownership (TCO). While retail adoption is often slowed by upfront costs, logistics firms are prioritizing the long-term operational savings of electric fleets. Dash Electric facilitates this transition through an EV-as-a-Service platform, allowing businesses to bypass significant capital expenditure by leasing electric delivery vehicles. This model has demonstrated efficacy in the last-mile delivery sector, maintaining high on-time delivery rates while reducing the carbon footprint of national logistics networks.

The Commercial Outlook and Structural Transition

The fiscal trajectory for the sector is defined by high-volume commercial adoption. Indonesia’s electric ride-hailing market is projected to expand from $108 million in 2024 to $690 million by 2032, representing a compound annual growth rate (CAGR) of 26.1%.

This growth is anchored by the commercial fleet sector, where motorcycles account for 63% of operational volume. Commitment from major platform operators to reach full fleet electrification by 2030 has shifted the market from speculative forecasting to a defined procurement pipeline. This scale provides the necessary demand to support localized manufacturing, infrastructure operations, and specialized financing models.

Policy Evolution: From Adoption to Conversion

The state’s ambition to reach 13 million electric two-wheelers by 2030 is being met with a shift in policy focus toward large-scale fleet conversion. Beyond the manufacturing of new units, the Ministry of Energy and Mineral Resources is developing a framework to transition a portion of the nation’s 120 million internal combustion motorcycles to electric powertrains.

The rationale for this conversion programme is dual-pronged: a reduction in localized urban emissions and a strategic reduction in the fiscal burden of national fuel subsidies. While the specific mechanics of the new incentive schemes are currently being finalized for 2026, the transition toward targeted fiscal support suggests a move toward long-term industrial sustainability rather than temporary consumption boosts.

The Macro Perspective

The realization of these targets depends on the continued alignment of upstream capacity and downstream infrastructure. By transitioning from broad consumer subsidies to targeted fiscal incentives and conversion frameworks, Jakarta is attempting to build a domestic industry that is resilient to global market fluctuations. With the integration of the battery supply chain and the emergence of specialized domestic infrastructure models, the structural components for a regional lead in green mobility are increasingly in place.

In a nondescript office in Jakarta, On Lee brings a long operator’s lens to a fast-moving moment. He serves as CTO at GDP Venture, and CEO and CTO of GDP Labs, and over more than 14 years, his teams have evaluated over a thousand technologies across cycles of hype and adoption. That vantage point shapes his core argument that AI creates durable advantage when it is treated as a new layer built onto what companies already run, rather than as a standalone initiative competing with existing systems and ways of working.

For Lee, the fallacy of the “standalone” AI project lies in its disregard for the structural realities of the modern firm. AI rarely thrives as a standalone effort; its efficacy is inextricably linked to the digital foundations (connectivity, mobile channels, and web architectures) that organizations have painstakingly constructed over decades. Rather than a “rip-and-replace” disruption, AI is emerging as a sophisticated restorative layer, one that extracts fresh value from existing systems.

The broader market context helps explain why this integration mindset matters now. Global AI funding reached USD 203 billion in 2025, the year also revealed the “pilot trap”: a landscape littered with experimental successes that failed to scale. Yet, these early trials served a vital purpose, acting as a stress test that exposed the friction points where AI meets legacy processes and real-world accountability.

As the “easy wins” of basic automation are exhausted, the pressure to deliver meaningful returns is intensifying. The strategic implication is clear: the next edge comes from execution, integrating AI into the operating architecture with clear ownership, governance, and workflow redesign, not from launching more isolated proofs of concept.

In markets like Indonesia, this is especially promising. The archipelago is witnessing a significant digital shift, with 5.9 million businesses having adopted AI solutions in 2024, and global tech-giants (e.g. AWS, NVIDIA, Google, Alibaba Cloud, Microsoft etc) are investing heavily in local infrastructure and talent. The next wave is about depth: moving from trial‑and‑error deployments to strategic, high‑impact use cases that transform how work gets done and how value is created.

The “ABCD-X” Framework

To bridge the gap between abstract strategy and operational reality, Lee introduces a taxonomy designed for clarity: the “ABCD-X” framework. This architectural shorthand representing AI, Blockchain, Cloud, Data, and X (encompassing IoT, mobile, security, and web) defines the essential building blocks of the modern digital enterprise. Rather than submerged in the impenetrable jargon of the IT department, this framework provides the C-suite with a shared vernacular to align disparate teams and synchronize long-term planning.

Lee’s rationale is rooted in the belief that simplicity is a prerequisite for scale. In the friction-heavy environment of a large organization, messages that are easily memorized are more effectively translated into collective action. By distilling complex technical dependencies into a repeatable concept, a company ensures that its strategic vision is not just understood at the top, but implemented consistently across every layer of the business.

This clarity turns AI from an abstract buzzword into a practical blueprint. By situating AI as a single, integrated pillar within a comprehensive architecture (tethered to data, infrastructure, and security) organizations circumvent the common hurdles that stall the transition from pilot to production. Rather than treating it as a speculative experiment, they redesign workflows so that AI strengthens what people and systems are already doing well.

Quiet Wins with Big Impact

Once an architectural blueprint is established, the focus shifts to responsible deployment, an arena where the abstract concepts of risk and fairness meet the friction of daily operations. Lee draws a helpful distinction between the unpredictable nature of public, internet-scale AI and the controlled environment of focused, enterprise-level applications. At GDP Labs, the emphasis is placed on internal solutions that streamline financial processes and operational workflows. In these settings, AI’s benefits can be realized quickly and safely, with accountable teams and clear guardrails.

However, this internal focus does not absolve the firm of moral scrutiny. As systems take on more influence over sensitive domains, companies have an opportunity to lead with fairness, transparency, and accountability. Lee’s knife analogy serves as a reminder that technology is inherently neutral; its impact is dictated entirely by the intent of the hand that wields it.

The practical path toward seamless integration lies in pairing AI with governance mechanisms (such as risk-tiered policies and human oversight) to translate intent into predictable results. Far from a bureaucratic hurdle, this framework transforms experimental risk into a reliable operational advantage. When this foundation of trust is secured, AI ceases to be a disruptive novelty and becomes a quiet support system. Integrated into the core of the enterprise, it removes granular friction from daily workflows, allowing employees to focus on the higher-value judgment that drives growth.

Building the Right ‘Transformation’ Team

Governance and workflows are essential, but they are only as effective as the people behind them. Lee looks for the ‘golden ratio’ of talent and expertise that reliably turns AI concepts into products people actually use.

When Lee looks at AI startups, he sees one constant among the teams that break through: they combine deep technical skill with strong product and business instincts. While he values founders with serious academic or research backgrounds, recognizing that AI is built on decades of scientific foundations, Lee maintains that translating that research into everyday utility is a distinct and equally vital craft.

In Lee’s view, research skills and productization skills are distinct, and companies need to turn ideas and algorithms into tools that end users can actually benefit from. The winning formula is not science or business alone, but a deliberate mix of technical founders and teammates who can ship products, serve customers, and build durable companies.

This pattern is already visible in success stories around the world. Teams that intentionally blend specialties (e.g. data scientists, product managers, domain experts, and operators) move faster and learn faster. They respond to feedback, iterate on their solutions, and create AI systems that feel intuitive and valuable to the people who use them every day.

For emerging ecosystems like Indonesia’s, this is a reason for optimism. While there may be fewer serial founders than in Silicon Valley, each new startup cycle produces more alumni with real, hands-on experience. Over time, that compounds into a seasoned talent pool of mentors, operators, and investors who know how to turn AI ambition into durable businesses.

The Discipline of the Long Curve

Even strong teams face a long execution curve, it is here that technical sophistication must be matched by institutional commitment and adaptability. When assessing what truly defines a high-impact AI enterprise, Lee emphasizes commitment more than any particular tactical framework. In his view, founders and early team members who treat startups as a serious craft, create the conditions for greater outcomes.

This focus on “craft” over “tactic” suggests that in a field as volatile as AI, the ability to persevere through iterative failures is the ultimate competitive advantage. Lee points to the historical parallels of figures like Bill Gates and Elon Musk to underscore a recurring truth in innovation: meaningful breakthroughs are rarely the result of luck alone, but of a singular, intense focus and a willingness to navigate the complexities of the long game. For the modern founder, this means that while technical tools have never been better, the human ingredients of timing, effort, and chemistry remain the decisive factors in turning ambition into a durable business.

Evidence from workplace deployments suggests AI assistants can raise productivity in specific tasks, for example, a widely cited field study found about a 14% productivity lift for customer support agents using a generative AI tool. When managed with sensible expectations, such gains would improve the bottom line and act as a buffer against burnout, allowing small teams to remain highly effective without succumbing to exhaustion.

Lee compares startups to creative industries such as music and film: there is no perfect formula, but certain patterns (talent, chemistry, timing, and effort) show up again and again in success stories. For AI founders, this is good news. It means that while luck plays a role, there is a lot that can be intentionally designed: assembling the right mix of people, choosing the right problems, and staying close to customers.

Partners, Not Replacements

As AI matures, its role is evolving from a passive tool into an “agentic” system—what Lee describes as a “digital colleague” capable of initiative and multi-step workflows. These agents act as tireless teammates rather than standalone tools, a shift that Gartner has designated as a defining technology trend for 2025.

Gartner forecasts that within four years, AI agents will autonomously handle 15% of daily workplace decisions, up from virtually zero today, a shift already visible as Human Capital Management platforms begin coordinating mixed teams of humans and AI agents as a single, blended workforce. For the employee, this evolution offers relief from routine, time-draining tasks. For enterprises, however, the implications are far more profound. The question is no longer whether AI will displace human workers, since Lee argues persuasively that wholesale replacement remains impossible, but how quickly organisations can augment their workforce with these digital counterparts. In this new landscape, the competitive reality is binary: humans equipped with AI will inevitably outperform those operating without it.

Lee frames the opportunity as a capability multiplier: when a mid-level contributor pairs with AI, output can improve in quality and speed. Tasks that once took months can compress into weeks or even hours, depending on context and governance.​

This evolution suggests a significant shift in competitive dynamics. Research increasingly quantifies these productivity gains, revealing that the ultimate advantage belongs to those who learn to collaborate with AI rather than those with the largest budgets. In this new landscape, a lean, well-equipped team of humans and “digital employees” can effectively challenge much larger incumbents. The encouraging takeaway for the modern enterprise is that strategic agility, rather than sheer capital, has become the primary driver of market edge.

A Practical Playbook for the C‑Suite

Predictions offer a useful horizon, but the immediate challenge for leadership is operational: what must be done to secure a competitive edge? For executives navigating this shift, Lee advocates for a pragmatic roadmap focused on personal intuition and strategic partnerships:

• Start learning personally: Leaders should not outsource their understanding of AI. True strategic intuition only forms when an individual engages with the technology personally to observe its impact on speed and decision-making. This is a matter of urgency.

• Prioritize high-value use cases: Rather than launching isolated experiments, focus on a limited number of concrete workflows where AI can be integrated into the existing system for visible impact.

• Leverage Strategic Partnerships: Organizations often achieve superior outcomes by combining “internal champions” with external specialists rather than building from scratch. Specialized vendors provide proven patterns and ready-made integrations, while internal teams provide the necessary context and data. This collaborative model significantly accelerates the move from idea to impact.

An important mindset shift is to treat AI less as a one-time project and more as an ongoing capability. Just like the internet or mobile, AI becomes a new layer in the company’s operating system.​ As teams gain experience, they can expand from early wins to more ambitious transformations across the value chain.

The Two-Tier Economy

That playbook matters because adoption is already uneven, and Lee sees a widening gap between organizations that have successfully integrated AI and those stalled in perpetual experimentation. In Southeast Asia, and particularly in Indonesia, the stage is set for a strong AI growth story where startups and digital-first companies are deploying AI to build new products and services. Fintech firms, for example, are improving fraud detection (e.g. Sxored.ai, Verihubs, etc), credit scoring (e.g. Skor Technologies, Aiforsee etc), and personalized finance (e.g. Vida, Privy, etc) , increasing accuracy while lowering operational costs, and these are increasingly local, real-world applications rather than distant case studies.

Large enterprises are also moving, but at a different pace. Their challenge is less about interest and more about complexity, including existing systems, regulatory requirements, and organizational structures. Once these companies solve the integration puzzle, their scale becomes a powerful asset, enabling them to move from cautious pilots to organization-wide AI programs.

Across the broader market, adoption remains uneven, mirroring the typical absorption cycle of any nascent technology. Companies built on digital services, such as banking and insurance, feel the impact of AI more acutely and immediately, while businesses centred on physical goods retain a longer window for adaptation. ‘Moving up’ for the middle tier is therefore less about hype and more about execution, clarifying use cases, integrating AI into the overall system rather than treating it as an isolated experiment, and building enough internal capability to scale beyond pilots.

Choosing to Lead with AI

All of these strategic threads converge into a singular, binary choice: integrate AI into the operational fabric of the firm, or fall behind those who do. Ultimately, the real divide in the global economy is not between companies that “have” AI and those that do not; it is between those that embed AI into their core operations and those that remain perpetually on the sidelines. This distinction extends to the individual level, separating teams that treat AI as a “digital colleague” and capability multiplier from those who cling to an outdated baseline.

The encouraging reality is that this remains a choice leaders can make today. The playbook for success is now clear: start with serious, small-scale applications, align technology with tangible business problems, blend deep technical skill with commercial intuition, and commit to an accelerated learning curve. By shifting from isolated experiments to an integrated architecture, organizations can transform AI from a speculative hazard into a durable competitive advantage.

The future of growth belongs to those who choose to integrate, not isolate. Lee’s bottom line is that advantage accrues to teams that integrate AI into daily workflows, because the productivity gap compounds fast.

Happy New Year!

We enter 2026 with renewed optimism as Indonesia’s startup ecosystem steps into a phase of true maturation, moving beyond exuberance into a more disciplined, resilient market.

The past year reaffirmed the strength of our fundamentals, marked by milestones such as Fore Coffee’s successful IPO and the entry of global players like Robinhood, underscoring Indonesia’s growing appeal to international capital.

In this edition, we highlight the “Merger Renaissance” and the reopening of the IPO window, expanding pathways for founders and investors alike. With a renewed focus on sustainable growth and integrity, the ecosystem is sharpening its filter for excellence and long-term value.

The opportunity ahead is immense, and we’re excited to navigate this next chapter of technology-driven growth with you.

Stay ahead,
Foundry Collective Team

When Founders Grow Up

The Indonesian startup ecosystem has experienced a reckoning. Not a collapse, but a recalibration. In the span of a year, the market shed USD318.1 million in funding as per 2025Q3. Valuations that seemed permanently inflated have deflated. Governance crises that were once unthinkable have become cautionary tales. Yet beneath the contraction lies a more consequential transformation: the shift from a venture-capital-dependent market to one where profitability, discipline, and strategic acquisition have become the language of success.

The turning point arrived in April 2025, when Fore Coffee, a premium coffee chain, raised IDR353.4 billion (approximately USD24 million) on the Indonesia Stock Exchange. The event seemed almost trivial: a domestic equity listing in a market besieged by macroeconomic headwinds. It was not. It was a statement that an Indonesian startup could achieve profitability without chasing billion-dollar valuations or perpetual venture capital. That message has reverberated through the ecosystem ever since.

The Governance Crisis That Changed Everything

In late 2024, eFishery, an agritech startup once valued at USD110 million, imploded. The company, which had raised capital from prominent regional venture funds and had become emblematic of Indonesian agricultural technology ambitions, collapsed amid allegations of fraud and governance failures. The case was not merely an isolated incident; it was a reckoning.

Investor response was immediate and severe. In Q1 2025, startup funding contracted 97 percent year-over-year as capital providers demanded enhanced due diligence, forensic scrutiny of financial claims, and board-level governance standards. Trust, which had been assumed and abundant in the exuberant years of 2020 to 2023, became the scarcest commodity in the ecosystem.

The eFishery case triggered an institutional response. Indonesia’s Financial Services Authority (OJK) implemented a sweeping regulatory overhaul, codifying standards for fintech regulation, crypto assets, and credit expansion. In February 2024, OJK Regulation 3/2024 expanded the definition of recognized fintech business models and introduced new risk management protocols. In January 2025, OJK assumed supervision of digital assets and cryptoassets (previously managed by the commodity futures regulator Bappebti), signaling that regulators would no longer tolerate speculative excess or governance lapses in the fintech sector.

Perhaps most tellingly, OJK introduced new regulation for “Buy Now, Pay Later” (BNPL) lending, capping interest charges and establishing stricter debt collection practices. These measures reflected regulatory concern about unsustainable credit expansion. Simultaneously, all fintech lenders were mandated to participate in SLIK, Indonesia’s national credit reporting system, by July 2025, aligning digital credit providers with traditional financial institutions in risk management and transparency.

Andreas Surya, Partner and Director of Investment at Kejora Capital, emphasized the importance of founder selection in an era of scrutiny, “The current funding environment demands selectivity. We need founders who are true industry experts, people who genuinely understand the sector they’re entering. Not founders chasing FOMO (Fear of Missing Out). If you want to enter banking, you must have founders who understand banking. If you’re entering logistics, you need someone who has actually worked in logistics. We also conduct more thorough background checks and integrity assessments. Reference checks alone are no longer sufficient. We look deeper at the founding team’s track record and character because governance failures almost always start with integrity issues.”

For sophisticated investors and founders, this regulatory tightening is not an obstacle; it is a competitive advantage. Companies that achieve early compliance with evolving standards and can credibly demonstrate transparent financial reporting, board independence, and fraud prevention will attract institutional capital disproportionately. Governance, once a checkbox exercise, has become a differentiator.

Profitability Becomes Currency

For years, Indonesia’s startup narrative followed a predictable script. Founders raised capital at astronomical valuations. They burned cash in pursuit of user growth. They promised that profitability would eventually arrive, after network effects had crystallized and markets had consolidated. Investors, seduced by the prospect of thousand-fold returns, participated willingly. That era has concluded.

Willson Cuaca, Co-Founder and Managing Partner at East Ventures, captured the shift in investor expectations.

Willson continued, “Focusing on profitability is not a new concept. We’ve advised this since 2022. When the global situation changed, we told our portfolio companies to prioritize profitability over growth. And they did, almost all of them are profitable now. But the media tends to amplify bad news more than good news. When a company becomes profitable, that’s not a headline to make. When there’s a scandal, everyone reports it.”

Fore Coffee’s successful IPO is instructive not because it is revolutionary (premium coffee chains are hardly a novel concept) but because of the economics that justified it. By September 2024, the company had generated USD43.2 million (or IDR727 billion) in net sales, growing 135% year-over-year. EBITDA had surged 187% in the same period. The company operated 216 outlets across 43 Indonesian cities, including tier-2 and tier-3 urban centers, plus one location in Singapore. This was not a company burning cash in pursuit of scale. It was a company printing money while expanding.

The market responded with enthusiasm. Retail investors oversubscribed the IPO 200.63 times, representing one of the most robust responses in recent Indonesian equity history. On its first day of trading, shares surged 34%, immediately hitting the automatic rejection upper limit. The signal was unambiguous: disciplined, operationally sound, profitable businesses command a premium.

Following Fore Coffee, Super Bank Indonesia (SUPA), a digital banking platform backed by Grab, Singtel and KakaoBank, moved toward its own IPO listing in December 2025, further validating the thesis that regulatory compliance and sustainable unit economics are now prerequisites for public market access. The IPO window, which seemed permanently sealed in 2024, has cracked open again, but only for founders who have prioritized profitability over vanity metrics.

In establishing profitability benchmarks, Willson emphasized, “Coffee companies achieve 60-70% gross margins. So why can’t tech companies? If you’re building something more sophisticated than a coffee shop, shouldn’t your margins be stronger? Set a benchmark. We use profitable companies like Fore as the standard and ask the next company: when will you hit these numbers? We’re not talking about EBITDA, we’re talking about net profit after tax.”

The implication is stark: the venture capital model, where founders pursue growth-at-any-cost with the implicit assumption that profitability can be engineered later, is no longer viable in Indonesia. Investors and founders alike must recalibrate.

The Merger Renaissance

If the IPO signal communicated a shift in investor preferences, the merger and acquisition (M&A) renaissance demonstrated that alternative exits have matured considerably. In late December 2025, General Atlantic, the USD118 billion global growth investor, closed its acquisition of Sociolla, Indonesia’s leading beauty and lifestyle e-commerce platform, for approximately USD250 million.

The transaction structure reveals the sophistication of contemporary Indonesian exits. Of the USD250 million acquisition price, USD200 million represented secondary purchases from existing shareholders (a dividend for early-stage investors), while USD10 million was injected as primary capital to fund operations. This hybrid approach solved a persistent problem in Indonesian venture capital: the lack of clear liquidity events for early-stage investors. Rather than waiting indefinitely for an IPO, existing shareholders like Pavilion Capital and L Catterton could exit at attractive valuations while newer investors, like General Atlantic, could acquire control stakes at economics that reflected current market conditions.

General Atlantic did not acquire Sociolla to harvest short-term gains. Its thesis centered on three structural advantages: regional expansion potential (Sociolla operates in both Indonesia and Singapore), profitable unit economics, and professional governance. These are precisely the criteria that sophisticated international investors now demand from Southeast Asian startups. The era of acquiring growth-at-any-cost has ended.

Across the Indonesian ecosystem, M&A activity accelerated in 2025. Grab’s acquisition of Chope, the restaurant reservation platform, exemplified how regional super-apps consolidate fragmented categories. Gojek’s historical acquisitions of Loket, MokaPOS, and Kudo demonstrated the same logic: regional platforms with access to capital can acquire adjacent capabilities far more efficiently than building them organically.

For founders of operationally sound companies, this development is consequential. The IPO path, always uncertain and distant, is no longer the sole ambition. A strategic acquisition from a well-capitalized international acquirer or regional conglomerate can deliver liquidity far more quickly, with less regulatory uncertainty and less exposure to public market volatility. The M&A market has matured precisely as the IPO window has reopened, a healthy balance for ecosystem participants seeking exits.

Where Money Actually Flows

The Fintech Concentration

Fintech remains Indonesia’s dominant startup category by funding. As per Q3 2025, fintech startups secured USD53.5 million across 5 disclosed transactions, representing 32,8% of total equity funding. At the regional level, Indonesia ranked third in Southeast Asia for fintech funding and second in deal volume, capturing 18% of regional fintech funding.

Leading fintech companies continue to demonstrate remarkable scale and resilience. Akulaku, a buy-now-pay-later platform, has raised USD522 million and reached a USD2 billion valuation while generating 14% revenue growth in 2024, reaching USD53 million in annual revenue with USD4.5 million in pre-tax profit. Xendit, a payment infrastructure provider, has raised USD515 million and is expanding into Mexico, Colombia, Brazil, Australia, and the United States by 2026. Kredivo Group, a digital credit platform, has raised USD390 million and launched its own digital bank, Krom Bank.

This concentration in fintech reflects a fundamental reality: Indonesia has 270 million people and limited traditional banking penetration outside urban centres. Digital payment systems, micro-credit platforms, and investment applications address genuine market gaps. Unlike discretionary consumer apps, fintech solutions solve infrastructure problems, a structural advantage that continues to attract capital.

The Profitability Pivot in Consumer Retail

A significant inflection occurred in the first half of 2025. Capital began flowing toward new retail and direct-to-consumer (D2C) companies demonstrating strong unit economics and early profitability. Examples include Hangry (food and beverage D2C), SEIndonesia (consumer goods), Flash Coffee (coffee retail), and One Nutrition (nutritional supplements). These companies share defining characteristics: high-margin direct-to-consumer models, strong customer loyalty, scalable operations, and clear paths to profitability.

In an environment where capital is scarce and impatient, efficiency metrics such as customer acquisition cost (CAC) payback period, unit economics, and burn rate have replaced user growth metrics as investment criteria. Founders of consumer companies that can demonstrate sustainable unit economics now attract capital more readily than founders pursuing hypergrowth at any cost.

Willson offered guidance for founders navigating this new landscape.

Surya added, “Startups need to be agile in a different way. They can’t simply pursue growth for twelve months straight. They need to alternate, spend time fixing fundamentals, then spend time growing. If fundamentals are wrong, growth will break things. Fix the foundation, grow, then fix problems that emerge at scale, then grow again. This iteration must be fast, but it must also be deliberate. You can’t pause development for a year, but you also can’t ignore foundational issues while chasing growth.”

Green Economy and Infrastructure: Underexploited Opportunities

A recent ecosystem report by ERIA identified an underexploited opportunity in green entrepreneurship. Although 87% of 304 surveyed ecosystem organizations identify as green-focused, only 107 provide green-specific funding. Capital remains concentrated in Jakarta, with persistent gaps in climate-ready financing and technical expertise for non-obvious green businesses: agriculture, waste reduction, and supply chain optimization.

Similarly, Indonesia’s digital infrastructure remains a constraint. In early January 2026, Indosat, Arsari Group, and Northstar announced a 925 million rupiah fibre-optic platform to address a critical gap: broadband connectivity in non-urban regions. As digital services penetrate tier-2 and tier-3 cities, infrastructure investment is becoming a logical destination for patient capital. The return profiles may be pedestrian compared to venture-backed software startups, but the structural necessity ensures sustained capital flows.

The Middle East Nexus: Indonesia’s Next Frontier

A striking trend emerged in 2025 to 2026. Indonesian startups increasingly pursued expansion into the Middle East and North Africa (MENA), framed as a strategy to diversify revenue and access new customer bases amid constrained domestic funding. The rationale is compelling.

MENA attracted USD171.5 million in startup funding in 2025. The Middle East has 240 million Muslims, aligned with 240 million Muslims in Southeast Asia, creating natural alignment around Islamic finance principles and halal-certified products. Xendit, the payment infrastructure provider, has explicitly targeted Gulf markets. D2C brands are scaling into regional export markets with halal compliance certifications.

For sophisticated investors, regional expansion should not be viewed as a distraction from the home market. Rather, it represents a necessary response to capital constraints and market saturation in Southeast Asia. Companies demonstrating competence in cross-border payments, halal compliance, and Islamic finance stand to capture disproportionate value.

Contraction as Feature, Not Bug

Total startup funding in Indonesia reached USD161 million in the first half of 2025, representing a 38 percent decline from 2024. Seed-stage funding collapsed even more dramatically, falling 68 percent from 2023 levels. In Q1 2025 alone, funding contracted 97 percent year-over-year.

These numbers, on their surface, suggest a crisis. They do not. Instead, they reflect rational capital discipline following years of excess. Startups that raised at USD100 million valuations on minimal revenue are now recalibrating expectations downward. Investors, burned by governance crises and valuation resets, are demanding premium risk-adjusted returns. Macroeconomic headwinds persist: global interest rates remain elevated, compressing startup valuations across emerging markets.

Critically, there is no capital shortage for strong companies. Fintech leaders, D2C brands with strong unit economics, and infrastructure plays continue attracting funding. The contraction is selective: early-stage, unprofitable, governance-weak companies face a severe capital drought, while operationally sound companies access growth capital with relative ease. The ecosystem is not broken. It is filtering.

Global Capital Enters

Indonesia’s maturing ecosystem has begun to attract global players that previously stayed on the sidelines. In December 2025, Robinhood Markets entered Indonesia by acquiring PT Buana Capital Sekuritas, a licensed brokerage, and PT Pedagang Aset Kripto, a digital asset platform. Rather than bypassing regulation, Robinhood chose institutional acquisition, signaling confidence in Indonesia’s governance, licensing, and market readiness. By 2027, it plans to offer Indonesian users access to US equities, crypto assets, and its full brokerage suite, expanding global market access for approximately 19 million capital market investors and 17 million crypto traders. For international incumbents, this approach reflects a shift toward compliance, profitability, and institutional rigor over growth at any cost.

Amazon’s entry reinforces this thesis through operational investment. In September 2025, the tech-giant led a USD 51.9 million funding round in Astro, a Jakarta-based quick commerce startup, acquiring a 14 percent stake. The investment reflects confidence in Indonesia’s dense urban markets and on demand consumption patterns. Astro’s unit level profitability, logistics efficiency, and execution track record, supported by Accel, Tiger Global, and Peak XV, align with Amazon’s regional strategy of backing local leaders while building proprietary capabilities, as seen in the parallel launch of Amazon Now in India. Together, these moves signal that Indonesia’s consumer and logistics infrastructure has reached a level of maturity attractive to large scale global capital.

The Regulatory Apparatus: Order Emerges

In a significant milestone, the Indonesian government reported that digital economy tax revenues reached IDR44.55 trillion (USD3 billion) through November 2025. OpenAI was officially designated as a VAT collector for online services, the first AI platform assigned this status globally.

This development signals three concurrent transformations. First, the digital economy has achieved fiscal maturity: taxation is now systematic rather than ad hoc. Second, Indonesian tax authorities are aligning with OECD frameworks for digital services taxation, signalling integration into global governance standards. Third, regulators recognise artificial intelligence’s economic role and are integrating AI platforms into tax collection infrastructure.

For startups, this creates both burden and opportunity. Compliance costs rise, but the formalisation of tax regimes reduces regulatory ambiguity and creates a more level playing field. Founders no longer navigate a regulatory grey zone; they operate within an increasingly codified framework.

The Consolidation Imperative

Indonesia’s e-commerce market illustrates the consolidation logic. In December 2023, ByteDance acquired a 75 percent stake in Tokopedia for over USD1.5 billion, merging the platform with TikTok Shop Indonesia. The combined entity now dominates Indonesian e-commerce while supporting micro, small, and medium enterprises (MSMEs), a consolidation that benefits both parties while reducing competitive fragmentation.

For startups, the implication is stark: competing against well-capitalised regional super-apps (Grab, Gojek, Tokopedia-TikTok Shop) is increasingly difficult. Rather than pursuing aggressive growth in red-ocean categories, founders should identify underexploited categories, develop defensible differentiation, or prepare for eventual acquisition. The acquisition premium will depend on operational metrics: profitability, unit economics, and governance quality. It will not depend on vanity metrics like user counts or growth rates.

2026 and Beyond

The Indonesian startup ecosystem enters 2026 fundamentally recalibrated. Several dynamics will persist:

• Selective capital allocation. Funding volumes will remain elevated but highly selective. Categories with structural tailwinds (fintech, agritech, healthtech, edtech, and green technology) will attract capital disproportionately. Early-stage, capital-intensive, governance-weak startups will face a prolonged fundraising winter.

• An expanding IPO pipeline. With Fore Coffee’s success and SUPA’s imminent listing, the IPO window has cracked open. Expect 2 to 3 additional public offerings in 2026 from mature Indonesian startups in sectors like D2C consumer brands and financial services.

• M&A acceleration. Strategic acquirers, both foreign platforms and regional conglomerates, will aggressively pursue acquisitions. For investors, M&A will become an equally attractive exit as the IPO, particularly for companies with strong operational metrics but limited public market arbitrage.

• Regulatory clarity. OJK’s codification of fintech standards, crypto regulation, and BNPL rules signals a shift towards predictability. Companies that achieve early compliance will benefit from regulatory favouritism and access to institutional capital at more favourable terms.

• Regional expansion. Indonesian startups will increasingly pursue expansion into MENA, India, and Vietnam. Companies with competence in cross-border payments, localisation, and regulatory navigation will capture outsized value.

The Verdict: Maturation, Not Decline

Indonesia’s startup ecosystem is not in crisis. It is in transition.

The mania of 2020 to 2023, when valuations were divorced from fundamentals and capital was abundant, has yielded to a more disciplined era characterised by profitability over growth, governance over exuberance, and sustainability over scale-at-any-cost. For sophisticated investors and stakeholders, this environment is not a warning signal. It is an opportunity.

Capital is flowing towards disciplined, well-governed companies with clear paths to profitability and regional expansion. The winners, those companies that emerge from this contraction with strengthened market positions and access to growth capital, will define Indonesia’s next decade of technology-driven development. The ecosystem’s maturation is complete. The next phase of growth has begun.

Welcome to Foundry Digest, your weekly briefing from Foundry Collective.

In this year-end edition, we examine Indonesia’s AI landscape and why local champions are emerging as the real drivers of applied AI. Drawing on insights from industry leaders, we highlight what’s working, where gaps remain, and the key ecosystem developments shaping the road ahead.

As we wrap up the year, thank you for being part of our community. We wish you a restful holiday season filled with quality time with family and loved ones, and a strong start to the year ahead.

Stay ahead,
Foundry Collective

🚀 Indonesia’s AI Landscape: Why Local Champions Will Shape the Future

Indonesia’s artificial intelligence (AI) landscape is no longer in the realm of hype. Consumer usage is mainstream, enterprises are shifting from pilots to production, and homegrown startups are exporting solutions abroad. Yet the ecosystem is still a work in progress, with meaningful gaps in deep tech talent, data practices, and capital.

Few founders sit close to this reality, including Irzan Raditya. As Co-Founder and CEO of Kata.ai, one of Indonesia’s leading AI companies with more than 250 enterprise clients, he has seen AI evolve from simple chatbots into autonomous agents embedded in core business workflows. Kata.ai’s platform alone has facilitated around USD 2.5 billion in annualized transaction volume in payment and collection workflows.

In this interview, he shares a grounded view of where Indonesia stands, what investors really want, and how local champions can build durable competitive advantages in applied AI.

A “6.5 out of 10” Ecosystem

Asked to rate Indonesia’s AI ecosystem on a scale of 1 to 10, Irzan does not answer with cheerleading.

It is a picture of a market in transition. Indonesia enjoys strong “market pull”: use cases are abundant, user behavior is already digital and messaging first, and enterprises feel real pressure to automate. Yet several layers need to catch up: data governance frameworks, robust infrastructure, and a deeper pipeline of AI engineers and product leaders.

Capital constraints add another layer of challenge. Funding into Indonesian AI startups has grown, but remains modest compared with global hubs and Singapore, which attracts a disproportionate share of regional AI capital.

The Real Bottleneck: Enterprise Trust

One of Irzan’s most counterintuitive observations concerns what actually constrains founders at different growth stages.

“For seed and pre seed teams, the first major client is still harder than the first funding round,” he explains. “Early funding can happen with a strong story and compelling team, but enterprise trust is earned through security reviews, procurement cycles, integrations, uptime, and proven ROI.”

This insight flips conventional wisdom. The first institutional check may be easier to obtain than the first serious enterprise deployment. Only after clearing that hurdle does the dynamic reverse.

“At growth stage, raising capital becomes significantly harder, especially in the current market where investors expect clear unit economics, profitability paths, and repeatable growth.”

The message is stark: storytelling might unlock seed funding, but durable traction requires navigating long enterprise sales cycles, surviving security audits, and delivering measurable business outcomes.

What Investors Actually Fund

Behind the buzz around AI, investor appetite in Indonesia is pragmatic and narrowly focused. According to Irzan, the most compelling AI narratives share two traits: they are business to business, and they directly improve measurable business outcomes.

“Investors are most excited by AI tied to clear ROI, especially B2B: automation in customer operations, sales, collections, compliance, and productivity. Distribution first startups also attract attention, because in Southeast Asia, go to market is often the real moat,” Irzan says.

This has immediate implications for founders. Generic AI features without defensible distribution or deep workflow focus will struggle. Companies that own a clear wedge use case, understand local customer behavior, and can show concrete value creation will remain attractive even in tighter funding cycles.

Agents Over Chatbots

The technical shift underlying today’s AI adoption wave is the transition from simple question answering to capable autonomous agents. Two or three years ago, most AI deployments were limited to FAQs or basic routing. That era is ending.

“Two years ago, chatbots mostly answered questions. Today, agents can plan and execute multi step workflows: call tools, trigger APIs, check rules, update systems, and complete tasks. It is not just better language, it is tool use plus orchestration, so the AI can actually do the job, not just talk about it,” Irzan explains.

This shift is most pronounced in financial services, Kata.ai’s fastest growing vertical. Banking, lending, insurance, and consumer finance share identical pressures: massive customer volume, measurable workflows, and intense efficiency demands without sacrificing compliance. Messaging first customer behavior amplifies impact. Customers expect to transact inside chat. AI agents managing an entire journey from inquiry through transaction to after sales support become infrastructure, not luxury.

Three Non Negotiables for AI Success

Years of production deployments have taught Irzan three capabilities he considers essential for any serious AI company in Southeast Asia.

First is enterprise grade delivery. Security and governance cannot be retrofitted. Startups must embrace compliance reviews, monitoring infrastructure, and robust service commitments from day one.

Second is local market realism. In Indonesia, multilingual complexity, code switching, and messaging first behavior are facts of life. AI products ignoring these realities see limited adoption.

Third is quantifiable ROI storytelling, where the narrative shifts away from abstract claims about “cool AI” toward concrete business outcomes. As Irzan frames it, the focus should be on how much cost, time, or operational leakage has been eliminated. The most successful deployments back this story with clear metrics, such as higher completion rates, faster resolution times, and measurable improvements in revenue capture.

These three capabilities combine into a defensible moat that global vendors cannot easily replicate overnight.

Scaling Beyond Indonesia

Kata.ai’s expansion into the Middle East offers a glimpse of how Indonesian AI companies can compete globally. Some elements of the playbook transfer directly. Others require careful adaptation.

“The core thesis still works: enterprises want ROI, and customer operations is the fastest place to prove it,” Irzan says. Yet Middle Eastern markets demanded a shift in delivery approach.

“The bar for procurement, security posture, and stakeholder alignment is different, and we adapted to be more structured and compliance forward,” he explains. Looking ahead, Kata.ai targets markets with Indonesia like characteristics: messaging first culture, high service volume, and multilingual complexity. This points toward Southeast Asia and select high growth regions where customer interaction is rapidly moving to chat and voice channels.

Homegrown Winners in Applied AI

A persistent question about Indonesia’s AI future is whether value will accrue to global tech giants or local startups. Irzan believes the answer reflects clear market division.

Indonesia may never need to build its own frontier model company. What it requires are founders capable of using those models as substrate to construct reliable, sector specific systems for banks, insurers, retailers, and public services.

His boldest prediction embodies this vision: “AI becomes the default interface for daily services, like a personal operator for admin life. But the twist is trust: people happily use AI for efficiency, yet still want humans when empathy, validation, or complex decisions are involved.”

A Disciplined Path Forward

For Indonesian companies adopting AI, Irzan emphasizes focus and governance: “Start with workflows where ROI is obvious, instrument everything, and take governance seriously. Adoption is already here, but literacy and privacy awareness are uneven, so you need strong guardrails and compliance discipline.”

For entrepreneurs, his advice cuts through hype: “Do not chase hype. Pick one painful workflow, go deep, earn trust, and build distribution. If you can deliver reliability and measurable outcomes in Indonesia, you can export that capability.”

The contours of Indonesia’s AI moment are visible. Adoption is real, capital is available, and proof points like Kata.ai demonstrate that local champions can compete globally in applied AI. Whether this moment crystallizes into durable advantage depends on how quickly the ecosystem deepens talent, infrastructure, and institutional support, and whether the next generation of founders chooses depth and trust over noise and speed.

📊 Indonesia’s AI Consumer Penetration

The kumparan’s Indonesia AI Report 2025 reveals AI has achieved significant penetration in Indonesia, with 96 percent of the public aware that their daily digital services are powered by AI. Generative AI chatbots lead adoption, with ChatGPT commanding 85 percent of users, followed by Meta AI at 72 percent and Google Gemini at 65 percent. Within six months, 80 percent utilized AI for information retrieval, demonstrating that AI has become the default tool for accessing knowledge.​

Adoption patterns differ markedly between generations. Gen Z prioritizes productive applications like coding and data analysis, while Millennials favor practical efficiency tools such as navigation and customer service chatbots. Both use AI equally for creative purposes at 61 percent for visual content creation. Usage intensity also varies, with Gen Z showing more stable integration at 35 percent using chatbots 6 to 10 times weekly, while Millennials display more variable adoption ranging from light experimentation to heavy usage.​

Organizational adoption lags individual use, with only 45 percent of companies actively promoting AI despite 57 percent of workers already using generative chatbots. The Digital Media sector leads adoption support at 55 percent, while Commerce Consumer Services remain largely neutral at 60 percent. This gap reflects limited AI expertise, high investment costs, and regulatory uncertainty. Compounding this, 68 percent believe AI will completely replace their jobs within five years, yet 79 percent express confidence their current skills remain adequate.​

Data security emerges as the primary concern for 55 percent of users, followed by accuracy at 53 percent and cost barriers at 50 percent. Notably, 75 percent worry about deepfakes and identity fraud, while 62 percent fear personal data misuse. Learning remains predominantly informal, with 84 percent relying on social media and YouTube rather than formal courses at 21 percent, perpetuating pseudo-literacy where users feel competent but lack foundational understanding. Indonesia’s adoption trajectory will depend on whether institutional governance and education can match user-driven enthusiasm.

⚙️ Industry Dynamics

Below are several notable developments that are shaping and influencing the direction of Indonesia’s evolving ecosystem landscape.

• Indonesia is preparing two key artificial intelligence regulations: an AI roadmap and AI ethics guidelines. Both are ready and are now waiting for President’s approval. The rules will be issued as presidential regulations and are targeted to be signed and published in early 2026. The Ministry of Communication and Digital said the framework will serve as a general policy umbrella, while detailed AI rules will be developed by each sector ministry according to their needs. [Read more]

• Indonesia’s Finance Minister Purbaya Yudhi Sadewa plans to invest Rp45 billion to develop an AI-based system at Directorate General of Customs and Excise. The system, called Trade AI, is designed to detect under-invoicing, over-invoicing, and potential trade-based money laundering, while improving the accuracy of import analysis. Trade AI will be integrated with the CEISA 4.0 platform to speed up decision-making and strengthen customs supervision. [Read more]

• Local omnichannel provider Qiscus has acquired AI voice platform Kokatto to expand beyond chat and strengthen its voice-based AI capabilities. The move responds to growing enterprise demand for managing higher volumes and more complex customer inquiries. Kokatto’s technology will be integrated into Qiscus’ platform to enhance its conversational AI stack, as businesses increasingly adopt advanced voice solutions. [Read more]

• Vietnamese electric vehicle maker VinFast plans to increase its investment in Indonesia to up to US$1 billion, following the opening of its first manufacturing plant in Subang, West Java. The company has invested around US$300 million so far and aims to raise production capacity from an initial 50,000 vehicles per year to as many as 350,000 units annually. VinFast Indonesia CEO said the investment could exceed US$1 billion if market demand continues to grow, with full operations targeted to start in early 2026. [Read more]

• EDENA Capital Partners has secured up to US$100 million in investment from GEM Token Fund ISA Ltd. to scale government-approved digital securities infrastructure in emerging markets. The funding will support the rollout of regulated security token offering exchanges in Indonesia and Egypt, with Indonesia positioned as EDENA’s ASEAN hub. The company plans to launch its Indonesia STO exchange and generate first revenues in early 2026, focusing on tokenized assets such as real estate, carbon credits, and bonds. [Read more]

Welcome to Foundry Digest, your weekly briefing from Foundry Collective.

In this edition, we examine why technology matters for Indonesia’s agricultural future, with a focus on execution, consistency, and ecosystem coordination. Drawing from insights shared by industry leaders, we unpack how AI and digital systems can strengthen real-world agricultural operations, support smallholder farmers, and build long-term competitiveness when grounded in practical implementation.

We also highlight case studies from Indonesia’s agritech landscape and key ecosystem developments shaping food resilience and innovation.

Stay ahead,
The Foundry Team

🚀 Tech-Driven Execution Seen as Key to Advancing Indonesia’s Agriculture

Strengthening execution and ecosystem coordination remains the most critical factor in advancing Indonesia’s agricultural sector, according to Tommy Wattimena, CEO of Great Giant Foods (GGF). While digital and emerging technologies like Artificial Intelligence (AI), Internet of Things (IoT) continue to evolve, their impact will depend on how well they are integrated into real-world agricultural systems.

Speaking in a discussion on food security and the future of agribusiness, Tommy highlighted that Indonesia’s challenges are less about innovation gaps and more about implementation, consistency, and coordination across the value chain.

“The opportunity is already there. The market exists, the natural resources exist. The real challenge is execution,” he said.

From Asset Ownership to Ecosystem Orchestration

Tommy noted that the traditional asset-heavy model of agriculture is becoming increasingly difficult to sustain. Limited land availability and fragmented ownership structures mean that future growth must rely on ecosystem orchestration rather than consolidation.

“Land is no longer abundant. We have to work with smallholder farmers, one or two hectares at a time,” he explained.

In this model, companies and startups are expected to act as coordinators, aligning farmers, supply chains, and markets rather than owning all production assets themselves.

Technology as Systems and Intellectual Property

In the discussion, technology was framed not as a single tool, but as a set of industrial and intellectual property–driven systems. These include seeds and genetics, biotechnology, ripening technology, and quality control mechanisms that enable consistency at scale.

Such systems are seen as essential for building credibility in both domestic and global markets, particularly where Indonesia has struggled with supply reliability.

Consistency as the Core Competitiveness Issue

One of the most persistent constraints in Indonesia’s agriculture sector is inconsistency across production and distribution. According to Tommy, demand is not the limiting factor.

“Demand is not the problem, both locally and globally. Consistency is,” he said.

Addressing this requires tighter coordination across farmers, logistics, processing, and governance structures. Without this foundation, even advanced tools and digital platforms will fail to deliver lasting impact.

Agriculture as a Long-Term Discipline

Tommy also cautioned against applying digital startup growth logic directly to agriculture. Biological cycles, environmental risks, and human factors make rapid scaling unrealistic.

He added that while technology can shorten learning cycles and improve efficiency, it cannot override the natural timelines of farming.

The Role of Digital and Emerging Technologies

Within this broader context, digital tools including data-driven systems and artificial intelligence can serve as supporting layers to improve decision-making and coordination. However, their effectiveness depends on ecosystem readiness.

“Technology must stay grounded. It has to work with farmers and real conditions on the ground,” Tommy emphasized.

Without strong farmer empowerment, infrastructure, and governance, technological adoption alone will not resolve structural issues.

Execution Over Hype

Looking ahead, Tommy stressed that Indonesia’s agricultural future will be shaped by its ability to execute at scale, empower farmers, and build resilient ecosystems.

“If we focus on execution and coordination, Indonesia is very well positioned,” he concluded.

The discussion reinforces a key message for policymakers, investors, and digital ecosystem players alike: technology, including AI, can amplify progress, but it cannot substitute for strong fundamentals, coordinated execution, and long-term commitment.

📊 How Digital Innovation Builds Food Resilience

The Food Resilience through Innovation and Technology report highlights the strategic role of digitalization in strengthening Indonesia’s food security, particularly through the agritech sector. It emphasizes that food availability is closely linked to agricultural efficiency and shows how local startups leverage technology and deep understanding of farmer needs to deliver practical, adoptable solutions across the value chain.

The report demonstrates that agritech is already generating measurable impact. Precision agriculture, IoT, automation, and artificial intelligence help reduce water and energy use, increase yields, and address labor shortages. These technologies confirm that digital innovation in agriculture is no longer experimental, but actively improving productivity and sustainability on the ground.

Several case studies illustrate this impact:

• Agrari, shows how smart farming using soil and weather sensors can double yields and significantly improve crop quality while empowering smallholder farmers.

• Eratani, presents an integrated agri-fintech and supply chain model that uses data-driven credit scoring and field-level support to improve farmers’ access to financing and ensure loan repayment.

• Kreasi Pangan, highlights a strategic shift from a direct-to-consumer model to a B2B, logistics-first supply chain approach, focusing on building a sustainable and replicable commodity model before scaling.

Overall, the report concludes that long-term food resilience in Indonesia depends on pragmatic digital innovation, strong logistics foundations, and collaboration across the agricultural ecosystem.

Get more insight, download the report: Food Resilience through Innovation and Technology.

⚙️ Industry Dynamics

Here are several significant developments across Indonesia’s ecosystem landscape that merit further attention.

• Airwallex has acquired a majority stake in PT Skye Sab Indonesia, a Category 1 licensed payment service provider, to accelerate its expansion across Asia Pacific and strengthen its local payment capabilities in Indonesia. The acquisition allows Indonesian businesses to access Airwallex’s global financial infrastructure for cross-border transactions, while enabling international companies to more easily enter the Indonesian market. This move follows Airwallex’s recent US$330 million Series G funding round and underscores Indonesia’s strategic importance amid rapid growth in digital payments, e-commerce, and cross-border trade. [Read more]

• Granite Asia has raised over US$350 million in the first close of its pan-Asia private credit fund, Libra Hybrid, with anchor commitments from Temasek, Khazanah Nasional, and Indonesia Investment Authority. The Singapore-headquartered firm, formerly GGV Capital Asia, is targeting US$500 million in total commitments as it expands beyond venture and growth investing into private credit. The strategy focuses on providing secured, non-dilutive financing to mid-sized Asia-Pacific companies pursuing growth and digital transformation, leveraging Granite Asia’s long track record in technology investing. [Read more]

Welcome to Foundry Digest, your weekly briefing from Foundry Collective.

In this edition, we explore how Indonesia’s young farmers are reshaping agribusiness through system-driven agriculture and practical technology, examine the country’s evolving agrifood landscape and its global positioning, and highlight key ecosystem developments.

Stay ahead,
The Foundry Team

🚀 Inside the Millennial Revolution Transforming Indonesia’s Agribusiness

In a modest greenhouse built on family-owned land, Felix, together with his brother Billy and fellow young farmers Calvin and Natalia, is rewriting the script of traditional farming. All four are part of the Young Farmers Academy, a millennial farmer group nurtured by Kreasi Pangan that equips emerging growers with practical skills and structured guidance. None of them come from agricultural academic backgrounds. Their fields of study range from graphic design to fashion and urban corporate careers. Yet they share a conviction that modern farming shaped by practical technology, systematic management, and strong market networks offers a new and promising future for Indonesia’s agribusiness sector.

From “Muddy and messy” to “Agritech with Measurable Outcomes”

The conventional image of Indonesian farming often revolves around physical labor, hot weather, and unpredictable income. This perception deters many young people from entering the agricultural sector. The interviewees highlight that one of the most significant changes is the adoption of system-based agriculture. They now use standard operating procedures, detailed record-keeping, structured workflows, and streamlined supply chains. These elements transform farming into a data-driven profession where decisions become measurable and margins predictable.

Indonesia’s 2023 Agricultural Census shows that only 21.9 percent of farmers are aged 19 to 39, a reminder that young farmers exist but that structured regeneration is urgently needed.

On the ground, technology does not automatically mean expensive IoT devices or full automation. For these young farmers, the most impactful improvements come from environmental control through greenhouses and hydroponic systems. These methods provide consistent yields and high-quality produce for premium markets. As Felix explained during the interview, “If we want to play in a premium market, we must ensure consistent harvests.”

The team approaches technology with financial discipline. Essential tools such as sensors or exhaust systems are prioritized, while high-cost automation is postponed until the farm reaches a larger scale. Early progress comes instead from simple digital tools like Google Sheets and field data logs.

Promising Numbers Balanced with Real-World Risks

The interview provides rare transparency into greenhouse economics. For a unit of roughly 1,000 square meters, the team reports:

• Revenue of around Rp60 to 70 million per cycle

• Operating margins of 40 to 50 percent

• Net profit of Rp30 to 35 million per cycle

These numbers help explain the rising interest among young professionals who view agribusiness as a viable and scalable career. However, challenges are real. Greenhouses require substantial initial investment and market fluctuations must be managed with discipline.

Partnerships with off-takers bring farmers more stability and predictability. They provide clear product standards and consistent pricing that farmers can use for planning future cycles. This stability is crucial, especially when compared with the unpredictable payment patterns in traditional markets.

Knowledge Transfer By Simplifying Complex Technical Concepts

Another important insight from the millennial team is the way they train their operators. Instead of hiring workers with prior farming experience, they prefer people who are not influenced by outdated techniques.

According to Billie, “We simplify the SOPs so that even people without an agricultural background can understand them.”

Training includes classroom learning, hands-on practice, and written tests. This approach ensures that the system can be replicated consistently as the business grows.

Young women are also stepping confidently into agribusiness roles. Natalia shared her experience of breaking stereotypes and embracing the work despite outdoor challenges: “My foundation shade went two levels darker, but in the end it was worth it.”

Her perspective highlights the increasingly inclusive environment emerging in modern agriculture.

Why Millennials Choose Farming

Many of the interviewees left comfortable city lifestyles to pursue agribusiness. Their motivation is long-term impact and the opportunity to build something meaningful. Calvin noted the industry’s resilience in an age of automation.

“This is one of the few industries that cannot be replaced by AI. Robots will become our partners in advancing this industry together,” said Calvin.

The transformation in Tulungagung results not from a single breakthrough but from a series of practical reforms. System-driven management, simplified knowledge transfer, appropriate technology adoption, and consistent market partnerships are reshaping agribusiness into an attractive path for Indonesia’s younger generation.

Their story suggests that the future of farming in Indonesia depends on more young people stepping forward with the willingness to learn, innovate, and lead.

📊Indonesia’s Agrifood Landscape: Top Commodities and the Big Players

Indonesia’s agrifood sector is built on several major plantation commodities that play an important role both nationally and globally. Oil palm is the largest, with 16 million hectares of cultivated land and 45 million tons of annual production, making Indonesia the world’s top producer. Other key commodities such as natural rubber, coffee, cocoa, and coconut also rank among the top three globally. Many of these crops are grown by smallholder farmers, showing how strongly the sector supports rural livelihoods.

The data from the Food Resilience Report 2025 also shows how large corporations shape Indonesia’s agrifood economy through scale and integration. Companies like Wilmar, Golden Agri-Resources, and Astra Agro Lestari lead in palm oil and oleochemicals and have strong export performance. Diversified food companies such as Indofood and Mayora strengthen Indonesia’s presence in global processed-food markets, while firms like Charoen Pokphand and Japfa drive growth in poultry, feed, and livestock. Together, these players highlight a sector that is becoming more integrated and export focused.

The case study of Great Giant Foods (GGF) shows how modern agrifood models can raise the value of Indonesia’s agricultural output. GGF manages about 33,000 hectares of pineapple plantations and exports fresh and processed products to more than 60 countries. The company produces roughly one in every four canned pineapples sold worldwide and operates using a circular economy system that turns waste into feed and fertilizer. This example demonstrates how innovation and value-added processing can strengthen Indonesia’s horticultural value chains.

Get more insight, download the report: Food Resilience through Innovation and Technology.

⚙️ Industry Dynamics

Here are several significant developments across Indonesia’s ecosystem landscape that merit further attention.

• DANA has launched the AI Enablement Playbook, a practical guide designed to help industries assess and improve their readiness to adopt artificial intelligence. The playbook includes insights, metrics, and principles for safe, inclusive, and scalable AI implementation, as well as an AI Enablement Checklist that evaluates business goals, data preparedness, infrastructure, and standardized AI tools. Built from cross-sector discussions, the guide aligns with Indonesia’s National AI Roadmap and introduces a three-level readiness model: Curious, Committed, and Confident. DANA aims to accelerate national AI adoption through collaboration, talent development, and responsible practices. [Read more]

• Chemistry AI startup ChemLex has raised US$45 million, led by Granite Asia, and established its global headquarters in Singapore. The company builds 24/7 autonomous chemistry systems that massively accelerate experiment workflows, generating in a single day as much data as three years of manual experimentation. ChemLex, which already supports more than 70 global customers including major pharmaceutical companies, will use the new funding to expand its team of engineers and chemists in Singapore and broaden its work in pharma and material science. [Read more]

• Robinhood Markets Inc. is entering Indonesia’s capital market by acquiring Buana Capital and PT Pedagang Aset Kripto, tapping into a rapidly growing investor base dominated by young, mobile-first users. The deal is expected to close in 2026 and aims to expand investor access to global assets while boosting financial literacy and inclusion through Robinhood’s technology-driven platform. The Indonesian government welcomes the move for its potential to strengthen market competitiveness and innovation, while regulators emphasize compliance, investor protection, and data security. [Read more]

• Indonesia and the United Kingdom launched the Innovation and Technology Fund (ITF) to accelerate green and climate-resilient development, supporting technology that reduces investment risks for low-carbon solutions. The initiative is part of broader climate policies, including the updated Climate Resilience Development Policy (PBI 2.0) and a new study on climate-driven population displacement in coastal and small-island areas. The government highlights urgent action, significant climate-finance needs, and the importance of science-based planning and multi-stakeholder collaboration to strengthen national climate resilience. [Read more]

• TP in Indonesia has launched TP.ai FAB, an AI orchestration platform that integrates analytics, generative AI, automation, predictive modeling, and human expertise to enhance large-scale operations. The platform aims to improve speed, accuracy, and customer experience across sectors such as banking, fintech, telecommunications, and retail. Its human-in-the-loop framework ensures ethical and compliant AI use. During the launch, industry leaders highlighted AI’s growing role in personalizing services and advancing Indonesia’s digital transformation. [Read more]

Welcome to Foundry Digest, your weekly briefing from Foundry Collective.

In this edition, we spotlight how Agricon is driving national food resilience through vertical agribusiness integration: reducing import reliance, strengthening upstream capabilities, and equipping smallholder farmers with accessible technology and climate-ready solutions.

We also highlight Indonesia’s smart farming momentum through Agrari’s data-driven model and share key ecosystem updates across circular economy policy, EV adoption trends, and institutional investment movements shaping Indonesia’s future.

Don’t miss the Indonesia Food Resilience Forum 2025 – a half-day conference featuring industry leaders and the launch of “Food Resilience through Innovation & Technology.” This is your opportunity to connect with key players shaping the future of agriculture and food systems in the region. More info: https://luma.com/75o04yki.

Stay ahead,
The Foundry Team

🚀Agricon’s Strategy to Curb Imports and Empower Farmers

Amid the challenges of climate change and global economic fluctuation, national food resilience can no longer rely solely on expanding land acreage. The key now shifts to supply chain efficiency and technological independence in agriculture. PT Agricon, a major player in Indonesia’s agribusiness sector, is answering this challenge through an aggressive vertical integration strategy, moving the production of agricultural inputs onshore and bringing innovative technology directly into the hands of smallholder farmers.

Dave Bengardi, CEO of Agricon, emphasizes that the future of Indonesian agriculture depends on the industry’s ability to reduce import dependency through integrated upstream and downstream initiatives.

Building Independence from the Upstream

Agricon’s grand strategy is currently focused on “going more upstream” in the agri-input supply chain. This move is not merely business expansion; it is a strategic effort to reduce reliance on imported raw materials and create products more relevant to local conditions.

“Integration for Agricon today is going more upstream in our agri inputs field. This is defined for us as trying to bring more of production of agriculture inputs into the country,” says Dave Bengardi. He cites the domestic production of suspension concentrate (SC) formulations and corn seeds as key examples.

This step allows Agricon to customize seed genetics to fit specific challenges across different regions of Indonesia.

“With more control over the seed that we sell to farmers we are able to customize the genetics in order to fit with farmer needs. In certain areas of Indonesia farmers face soilborne diseases such as downy mildew that can drastically reduce production. We can create seed that have higher resistances to this,” Dave explains.

Lowering Technology Barriers for Smallholder Farmers

One of the greatest paradoxes in Indonesian agriculture is the availability of advanced technology that remains unaffordable for farmers with low average incomes. Agricon’s vertical integration aims to cut supply chain inefficiencies so that cutting-edge technology becomes accessible at a reasonable price point.

Dave highlights that the technology to drastically improve yields is available, yet the barrier to entry for farmers remains too high.

A concrete example of this approach is the launch of “Brofreya,” an insecticide developed in partnership with Mitsui Chemicals. This technology successfully cut the spray program for shallot farmers from 10-15 times a season to just 3-5 times. This efficiency not only reduced labor costs but also increased yields by 10-15% due to more effective pest control.

Climate Adaptation: Innovation Amidst Uncertainty

Food resilience also means climate resilience. Facing phenomena like La Niña and increasingly unpredictable weather, Agricon has introduced practical innovations such as the “Suryakencana” drying system. This system is essentially a modified greenhouse turned into a drying house, enabling farmers to dry crops 50-70% faster without relying on electricity.

“This year with La Nina has been quite a difficult year for farmers in the horticulture sector... Our products have been able to at least protect farmers from the downside risk by helping them navigate the disease pressure,” adds Dave.

Collaboration for a Stronger Ecosystem

Agricon recognizes that food resilience cannot be achieved in isolation. The company actively partners with universities for bio-product research and works with the government (Ministry of Industry and Ministry of Agriculture) to set pesticide standards that protect farmer interests.

Furthermore, Agricon acts as a bridge in the downstream sector. “Agricon often works together with partners that are on the post harvest side of the business to connect our farmers to buyers that have better and/or more stable pricing,” says Dave, referring to initiatives that connect corn farmers directly to industrial buyers.

Through comprehensive vertical integration (from seed research in the lab to post-harvest market connectivity) Agricon proves that the path to national food resilience must be built on a foundation of industrial independence and a commitment to farmer welfare.

📊 Indonesia’s Agritech Revolution

This insight is featured in the upcoming report “Food Resilience through Innovation and Technology,” which Foundry Collective will launch at the Indonesia Food Resilience Forum 2025 tomorrow. 

Indonesia’s agricultural sector is undergoing a fundamental transformation, shifting from traditional farming methods to data-driven approaches. Smart farmingis driving this change, advancing through five progressive levels from software and hardware to automation, data analytics, and artificial intelligence. These precision technologies enable farmers to optimize resources, increase yields, and build resilience across crops, livestock, and aquaculture.

Agrari, a homegrown agritech company, demonstrates how smart farming directly tackles agricultural inefficiency. Using its Astani product with soil and weather sensors to collect real-time field data, Agrari achieves measurable results: higher yields, up to 50% reduction in crop losses through data-driven pest control, and empowerment of smallholder farmers through its Inti-Plasma partnership model. This end-to-end approach (from farm level to market) creates a more sustainable and self-sufficient food system while minimizing chemical residues for export compliance.

Agrari’s targets tell the full story: doubling yields from 30 to 60 tons per hectare and increasing premium, export-quality fruit from 15% to 80%. By solving core agricultural challenges through digital innovation, smart farming strengthens individual farmers while advancing Indonesia’s food sovereignty. This enables the country to meet rising domestic demand and reduce import dependency, building a more resilient agricultural future.

⚙️ Industry Dynamics

Here are some noteworthy ecosystem-related developments from Indonesia worth exploring.

• Indonesia and Germany have launched the InCircular project to accelerate the country’s circular economy transition. The five-year collaboration between Bappenas and GIZ will support the Circular Economy Roadmap & Action Plan 2025–2045, focusing on stronger regulations, capacity building, improved coordination, and upgraded waste-management systems in East Java, Bali, and Jakarta. The initiative aligns with Indonesia’s existing policies, including mandatory EPR, closing open-dumping landfills, green industry standards, and waste-to-energy development, to cut waste and boost resource efficiency. [Read more]

• Indonesia’s electric vehicle (EV) market grew 49% this year even as conventional car sales fell 11%, according to PwC. Weak economic conditions slowed overall vehicle demand, but EV adoption continued to rise due to tax incentives and battery investment progress. While below the ASEAN average EV growth of 62%, Indonesia is seeing increasing interest, with 14% already owning EVs and 70% considering purchase. Thailand and Vietnam remain regional leaders with adoption above 30%. [Read more]

• BPJS Ketenagakerjaan is exploring investment opportunities in global AI infrastructure companies, including those in the U.S., Taiwan, Japan, and South Korea, as part of a strategy to diversify its portfolio and tap into the rapidly growing AI supply chain sector. Managing IDR879 trillion in assets, the institution has requested approval to invest up to 5% overseas, focusing on data centers, energy providers, and cable network companies rather than core chipmakers, though options like Nvidia remain under consideration. The initiative awaits government regulatory clarity and hinges on rupiah stability, while BPJS also targets doubling domestic equity allocation to 20% over the next three years. [Read more]

Welcome to Foundry Digest, your weekly briefing from Foundry Collective.

In this edition, we dive into how Chickin is transforming poultry farming through innovative financing and smart technology, explore agriculture’s growing role in Indonesia’s impact investing landscape, and share critical ecosystem updates on major funding initiatives and regional ventures.

Don’t miss the Indonesia Food Resilience Forum 2025 – a half-day conference featuring industry leaders and the launch of “Food Resilience through Innovation & Technology.” This is your opportunity to connect with key players shaping the future of agriculture and food systems in the region.

Stay ahead,
The Foundry Team

🚀 Closed-Loop Model: How Chickin Saves Poultry Farmers from Price Volatility

Indonesia’s poultry industry contributes IDR700 trillion to the national economy, yet farmers often suffer massive losses. Chicken prices fluctuate drastically within hours, making survival difficult. Farmers commonly profit for six months and lose money the other six months annually.

Chickin, an agritech company founded in 2017, solves this through a closed-loop business model integrating financing, smart farming technology, and supply chain management.

This creates extreme uncertainty. When supply exceeds demand, prices collapse despite farmers’ significant production costs.

“Many Indonesian farmers cannot survive because they depend on extremely high price risks,” Tebe adds.

Chickin’s Solution: Three Integrated Strategies

1. Input Financing, Not Cash

Chickin directly purchases chicken feed from suppliers with cash payment rather than giving farmers cash. This creates two advantages: Chickin achieves economies of scale through bulk buying and secures large discounts, which farmers automatically benefit from. Feed efficiency improves by 30%.

2. Smart Farming

Chickin provides technology to maximize productivity:

• Online dashboard: Replaces manual records with AI-powered automatic systems

• Climate control hardware: Automates temperature, humidity, and oxygen regulation

• AI and computer vision: Enables digital weighing and production uniformity

“When yield improves, we can achieve up to 30% efficiency gains in feed costs. In terms of mortality, we can improve it by around 50%,” Tebe states.

3. 100% Offtake Guarantee

When farmers harvest, Chickin automatically purchases all output at agreed prices. Farmers avoid unsold inventory or below-market sales. Chickin achieves this through vertical integration: processing facilities, 13 cold chain hubs, and restaurant brands in 12 cities.

Scale and Impact

Chickin’s model has delivered impressive growth:

• 12,000 coops using Chickin’s app

• 88 million chickens in ecosystem

• IDR 1.5 trillion financing distributed annually

• 3 million chickens under financed contracts

Surviving Crisis

During 2022-2023 oversupply crisis, when prices collapsed, Chickin survived by maintaining healthy unit economics and measured growth. “We grow slowly, carefully optimizing every cost component,” Tebe states.

Chickin also leverages purchasing power to negotiate better prices with major feed producers.

The government’s Free Nutritious Meal Program (MBG) is projected to increase chicken demand by 20% of national needs. “From the 330 trillion MBG budget, 60% goes to raw materials. Around 100 trillion will be added for protein—chicken and eggs,” Tebe explains.

Indonesia has the lowest per capita protein consumption in Southeast Asia. With rising incomes and government programs, demand will continue growing.

“Now is the right time to invest in agriculture. Everyone focuses on food security,” he adds.

Weak cold chain infrastructure remains a bottleneck. Chickin plans further investment in this area to strengthen the supply chain.

📊Agriculture Becomes Top Priority in Indonesia’s Impact Investing Landscape

Agriculture has become the second most-funded sector in Indonesia’s impact investment landscape, with 19 of 57 funds targeting agricultural sustainability according to the Indonesia Impact Alliance 2024 report. Yet a critical funding gap exists for enterprises needing USD100,000 to USD1 million. This USD50.8 billion annual gap leaves one in four agricultural companies without access to suitable impact investors.​

The sector is also shifting from Development Finance Institution dominance toward private investors, with USD1.44 billion deployed in 2020-2022, making Indonesia Southeast Asia’s most active impact investing market. Agricultural funds use mixed equity-debt strategies, though collateral requirements and longer investment timelines remain barriers to capital access.​

The research proposes an Indonesian Impact Investment Wholesaler to aggregate capital through blended finance and channel it via smaller funds (USD30 million and below). This model can unlock private investment in sustainable agriculture while reducing risk, creating a multiplier effect for agricultural growth and Indonesia’s SDG progress.

⚙️ Industry Dynamics

Here are several ecosystem updates from Indonesia that are worth following.​

• Indonesia’s BPJS Ketenagakerjaan explores AI infrastructure investment opportunities overseas, targeting companies in the U.S., Taiwan, Japan, and South Korea. The agency aims to diversify its portfolio within the expanding AI supply chain ecosystem—focusing on data centers, energy suppliers, and cable infrastructure rather than core chip manufacturers. BPJS Ketenagakerjaan manages Rp879 trillion in assets and is awaiting government approval to invest up to 5% abroad. [Read more]

• NTT Group has launched its first Southeast Asia startup investment vehicle, Synexia Ventures, based in Singapore and set to begin operations on December 15, 2025. The fund, jointly managed by NTT DOCOMO Ventures and NTT Finance alongside regional VC leader Kuan Hsu, will invest in startups across Singapore, Indonesia, Malaysia, and the Philippines, particularly in AI, IoT, smart cities, robotics, and drones. The initiative aims to accelerate collaboration with local innovators and strengthen NTT’s business expansion in the region. [Read more]

Welcome to Foundry Digest, your weekly briefing from Foundry Collective.

In this edition, we highlight Kejora Capital’s investment strategy, global leadership data driving food-system transformation, and other key updates from the ecosystem.

We’re also pleased to invite you to the Indonesia Food Resilience Forum 2025, a half-day conference featuring key leaders in agriculture and food innovation, along with the launch of the report “Food Resilience through Innovation & Technology.”

Register here: bit.ly/IFRF2025.

Stay ahead,
The Foundry Team

🚀 Kejora Capital’s Staged Investment Strategy for Supporting Indonesia’s Food Resilience

In the investment map of Southeast Asia, Indonesia’s agriculture technology (agritech) sector is often viewed as a challenging terrain. Yet, for Kejora Capital, this is precisely where golden opportunities lie. With a measured, step-by-step investment approach that starts at the production level, they are proving that building food resilience is not only impactful but also commercially viable.

Behind the estimated US$30 to 40 billion potential of Indonesia’s agricultural output lurks a set of classic challenges: an aging farmer population, productivity lagging behind neighboring countries, and relentless conversion of arable land.

While many investors, particularly global players, remain hesitant to dive in, Andreas Surya, Partner & Director of Investment at Kejora Capital, sees a missed opportunity.

For Kejora, investing in agritech is not a leap of faith, but a gradual journey beginning with the most fundamental layer: production.

Starting Upstream: Strengthening the Production Foundation

Instead of immediately targeting supply chain logistics, fintech, or crop insurance, Kejora chooses to first focus on enhancing production capacity at the farmer level.

“I believe this will come in stages. So, the first thing we must focus on is our output. Technologies that strengthen the robustness of out-yield from agri-farms, aquaculture, and so on. That comes first,” Surya emphasized.

The logic is simple: without quality and quantity in production, it is impossible to build a resilient value chain. Once production is stable and efficient, supporting aspects like access to financing, insurance, and food waste reduction can be integrated more easily.

“If the production is good, the goods are of high quality, then even securing insurance will be easier. It will be cheaper, simpler, and more players will enter. Why? Because the foundation is solid,” he explained.

Appropriate Tech and Scalability

When evaluating agritech startups, Kejora looks beyond market size and the founding team. Technical aspects and long-term sustainability are key considerations.

“We want to look at the longer-term angle, like climate resilience. Will this solution help to address future challenges, not just current ones?” Surya added.

Scalability is also critical. Can a solution that works in one region be replicated elsewhere? The business model and operational processes are specific points of assessment, alongside traditional metrics like traction and unit economics.

Despite having a clear strategic map, Kejora recognizes that transforming the agritech sector is impossible to do alone. They actively facilitate multi-stakeholder collaboration, connecting startups with corporations, government bodies, and farmers.

Looking five years ahead, Surya’s hope is simple: to see more local fruits like Malang Apples or Medan Oranges filling the shelves of domestic supermarkets, replacing imported produce. This would be a tangible indicator that Indonesia’s agritech ecosystem has grown robust.

Kejora’s staged strategy carries an optimistic message: building food resilience is a marathon, not a sprint. With a strong production foundation, appropriate technological support, and tight collaboration, investing in Indonesian agritech is not just about profit and loss; it is about sowing the seeds for a more sovereign and resilient nation in the future.

📊 Global Leaders Call for Food System Transformation

A KPMG survey of more than 200 global business leaders shows clear agreement that the current food system is not resilient enough to handle rising environmental, geopolitical, and economic pressures. Leaders highlight the need for a shift toward a more regenerative and inclusive system that protects ecosystems and better supports smallholder farmers.

Most leaders also stress that real change requires cross-sector collaboration. Agriculture alone cannot drive the transformation; technology providers, financial institutions, energy companies, logistics networks, and governments must work together to strengthen long-term food security.

Technology is seen as the strongest catalyst. Leaders point to digital supply chains, precision agriculture, and data-driven tools as key enablers. Yet they also acknowledge major obstacles, including misaligned policies and high upfront technology costs, which currently slow progress.

⚙️ Industry Dynamics

Here are several noteworthy news from Indonesia’s ecosystem worth exploring.

• Louis Dreyfus Company (LDC) is strengthening its commitment to Indonesia in 2025 with major investments, including a new glycerin refining plant with a 55,000-ton annual capacity and a new edible oil packaging line in Lampung. Despite global geopolitical and regulatory challenges, the company reported 4.4% volume growth in the first half of 2025. LDC continues to support local farmers through training, sustainability programs aligned with ISCC and RSPO standards, and initiatives that empower women in agriculture. These developments underscore LDC’s long-term strategy to advance downstream operations, boost supply chain resilience, and deepen its economic contribution to Indonesia. [Read More]

• At COP30, Indonesia officially released its Blue Carbon Roadmap and Action Guidelines, developed by multiple ministries with international support. The document sets a unified national framework for high-integrity blue carbon implementation across coastal and marine ecosystems, integrating mangroves, seagrasses, and tidal marshes into emission-reduction strategies and the national carbon economy system. The roadmap positions blue carbon as a key component of climate policy while unlocking benefits such as biodiversity protection, coastal resilience, and sustainable economic opportunities. [Read More]

Welcome to Foundry Digest, your weekly briefing from Foundry Collective on Indonesia’s technology and investment landscape.

In this edition, we explore strengthening Indonesia’s horticulture value chain, highlight data on the country’s growing digital economy, and share the latest industry dynamics.

Whether you’re tracking innovation, investing, or shaping policy, Foundry Digest delivers sharp, actionable insights to keep you ahead.

Stay ahead,
The Foundry Team

🚀 Inspiring Story: Agrari’s Bid to Repair Indonesia’s Horticulture Value Chain

In Indonesia’s agriculture industry, fruit fly infestations are often underestimated, but their impact ripples across the entire horticulture value chain. The effects range from crop failures and downgraded fruit quality to eroded market trust and mounting farmer debt.

Agrari, an agritech startup focused on improving fruit harvest quality through technology, argues that the root cause of Indonesia’s low fruit quality lies upstream: persistent fruit fly attacks that are not being handled properly.

“We initially focused downstream by acquiring a post-harvest patent. But if the fruit arriving at the packing house is poor quality, it’s pointless. The root problem is upstream,” said Agrari Founder & CEO Robertus Theodore in an exclusive interview.

Agrari is an agriculture technology company dedicated to overhauling the horticulture value chain, especially for fruit commodities. Through a core-plasma partnership model, modernized cultivation, and integrated tech solutions, the company aims to lift productivity, improve harvest quality, and raise farmer incomes.

Founded in 2022, Agrari is transforming agriculture with innovative technology designed to empower farmers and promote sustainable practices. Its flagship product, ASTANI (short for “Farming Assistant” in Indonesian) is the country’s first Tree and Soil Sensing Sensor, specifically developed for fruit plantations. Leveraging IoT and AI, ASTANI standardizes harvests, detects pests, monitors plant growth, and tracks fruit development.

Complementing ASTANI, Darifarm delivers premium, high-quality produce from Agrari-supported farms, helping farmers meet market demand for superior yields. By equipping farmers with advanced tools to understand soil, plant, and weather conditions, Agrari enables precise plant care and exceptional harvests. At present, the company is rolling out integrated pest-management (IPM) programs and targeting significant plasma-area expansion over the next few years.

The Domino Effect of Fruit Flies

Robert explained that fruit fly attacks on citrus, mango, starfruit, and guava can cause up to 50% crop failure. Infected fruit often rots during distribution, contaminates other produce, and undermines buyer confidence.

“As a result, prices are suppressed and farmer incomes plunge. To cover losses, farmers reduce fertilizer use, leading to less sweetness and weaker fruit resilience. It’s a vicious cycle,” he added.

Heavy reliance on chemical pesticides also leads to residue buildup on fruit, constraining export potential and posing health risks to consumers.

An Integrated “Painkiller”

In response, Agrari has developed a bundled, integrated solution, its “painkiller” for farmers, modeled after a military strategy: establish perimeters, deploy traps, and sanitize orchards.

The method also includes weather and soil monitoring via sensors, as well as a core–plasma partnership approach to consolidate smallholders.

Within two years, the approach has begun to show results. Average plasma-orchard productivity increased from around 30 tons per hectare to 38 tons per hectare. Premium-grade fruit (supermarket class) rose from 15% to at least 50%, with a target of 80%.

“Most importantly, the fruit has minimal chemical residue because we use more environmentally friendly inputs,” Robert emphasized.

Expansion Plans and Scaling

Agrari currently manages more than 150 hectares of plasma orchards and plans to expand to as much as 2,500 hectares within the next two years, with North Sumatra as a priority.

“By controlling fruit flies across 20% of key citrus areas, we can significantly suppress pest populations. Cultivation costs fall, quality rises, and only then can we confidently enter domestic and international markets,” he said.

While upstream challenges such as farmer mindsets and land fragmentation remain significant, Robert is optimistic about the sector’s outlook.

“Domestic fruit consumption is still 50% below the standard. The market opportunity is huge. With modernization and the right approach, we can not only meet domestic needs but also become a credible export player,” he concluded.

The war against fruit flies is more than a harvest issue, it is a strategic step toward healthier, more sustainable food security that benefits farmers.

📊 Data & Insight: How SEA’s Digital Economy Strengthens Food Resilience

Southeast Asia’s digital economy continues to grow steadily, with a projected GMV of over US$300 billion by 2025 and an annual growth rate of around 15%. Core sectors such as e-commerce, digital finance, and on-demand services are shifting toward sustainable monetization. Video commerce already accounts for 25% of e-commerce GMV, while digital payment infrastructure is rapidly expanding across borders. As digital platforms mature, they increasingly play a role beyond consumer services, supporting broader development goals including food security.

Digital technologies have become a critical component across real sectors, serving as essential tools in advancing food resilience initiatives. In the Southeast Asia region, with climate change and supply chain disruptions threatening food systems, digital platforms help improve farming efficiency, reduce post-harvest losses, and connect producers to markets. AI-powered advisory apps, IoT sensors, and digital payment integration provided by agritech innovators enable small farmers to make better decisions, access financial services, and sell produce more efficiently. These capabilities are crucial to building resilient food systems that can withstand external shocks and feed growing populations.

The agritech sector has seen rising investor interest in SEA, reaching US$2.6 billion in funding in 2024. With more than 270+ startups active in the region, solutions range from precision agriculture and drone monitoring to online marketplaces for surplus produce. Agritech not only helps optimize inputs and increase yields but also supports sustainability by reducing waste and enhancing supply chain transparency. As such, it is increasingly seen as a strategic pillar of both digital economy growth and food security policy.

In Indonesia, agritech plays an important role in efforts to secure food resilience for its 33 million smallholder farmers. Local startups such as Eratani, Agrari, and Chickin offer digital solutions for crop planning, livestock monitoring, and supply chain logistics. Government support for smart farming and rural digital access further accelerates adoption. With strong alignment between digital innovation and national food goals, Indonesia illustrates how the digital economy can directly contribute to building a more secure and sustainable food future.

⚙️ Industry Dynamics

Here are several noteworthy news updates from Indonesia’s ecosystem worth exploring.

• Living Lab Ventures, the corporate venture arm of Sinar Mas Land, has launched the Japan Thematic Fund in partnership with Spiral Ventures to strengthen Japan–Southeast Asia investment collaboration, with Indonesia as the main focus. The fund brings together strategic investors including Cool Japan Fund, Bank Danamon (part of MUFG Group), Rohto Pharmaceutical, Advasa, and Culture Convenience Club (TSUTAYA Group). Their participation reflects Japan’s growing interest in Southeast Asia’s creative economy, technology, and urban innovation, while positioning BSD City as a regional smart city hub and a bridge for cross-border startup collaboration throughout Southeast Asia. [Read More]

• Indonesia’s online spending surged 6.19% quarter-on-quarter in Q3 2025, with Bank Indonesia recording IDR134.7 trillion in e-commerce transactions—up 4.93% from Q2. The increase was fueled by nationwide discount campaigns such as 7.7, 8.8, and 9.9, boosting participation across top local e-commerce players ahead of 11.11. Electronics, food and beverages, and beauty products led sales, while Eastern Indonesia saw the fastest growth. Despite seasonal shifts in consumption, household spending remains resilient, keeping Indonesia’s digital economy on an upward trajectory. [Read More]

Welcome to Foundry Digest, your weekly briefing from Foundry Collective on Indonesia’s technology and investment landscape.

In this edition, we explore key supply chain challenges in agriculture, highlight data on the sector’s significant credit gap, and share the latest industry dynamics.

Whether you’re tracking innovation, investing, or shaping policy, Foundry Digest delivers sharp, actionable insights to keep you ahead.

Stay ahead,
The Foundry Team

🚀 Inspiring Story:
Horticulture is Hard to Scale, Supply Chain Stability is the Missing Link

Scalability remains a core challenge for Indonesia’s horticulture sector. From chilies to melons, many upstream development efforts fail to reach meaningful scale due to inconsistent yields, fragile farmer institutions, and costly logistics. Yet the market potential is vast. Estimates put Indonesia’s horticulture market at around IDR 1,500 trillion (USD 90 billion) annually, while per-capita fruit consumption remains roughly 50% below the World Health Organization (WHO) standard.

Amid these headwinds, Kreasi Pangan is redesigning its playbook to balance upstream and downstream in a more realistic way. Formerly best known for its Kedai Sayur online-grocery service, the company has transformed into an integrated agriculture enterprise, covering everything from farm-gate sourcing to last-mile distribution.

Established in 2018, Kreasi Pangan now works with over 400+ farmer partners, 600+ B2B partners, and serves more than 80,000+ active consumers. The company has raised funding from Kejora Capital, East Ventures, SMDV, Triputra Group, and Multi Persada Nusantara.

Fragile Institutions, Slow SOP Adoption

According to Adrian, weak farmer-level institutions are a major bottleneck. Cooperatives often struggle to endure due to leadership turnover and poor record-keeping. The industry, however, requires continuity and reliable supply to sustain long-term contracts.

Standard operating procedures (SOPs) also remain unevenly applied. Many farmers have yet to see the economic value of strict compliance, especially when higher yields and margins haven’t been proven in the field.

“SOP adoption needs clear proof that outcomes and margins improve. Only then can you scale,” Adrian explained.

After testing several upstream approaches, Kreasi Pangan chose to build logistics foundations first to cut waste, secure volumes, and shorten distribution chains. “If supply and logistics aren’t strong, scaling production only creates more waste,” Adrian said. In his view, improving logistics systems and demand forecasting has a more immediate impact on price stability than expanding planted area.

Greenhouse Melons: A Replicable Small Model

One innovation under trial is greenhouse-grown melons in East Java. The system enables tighter control over quality, flavor, and harvest frequency. Produce is sold across grades, from premium fruit for fresh markets to lower grades for juice, minimizing waste.

With more than 20 greenhouses operating, early results are promising. “Farm-gate prices can be IDR 10,000-12,000 per kilogram, while retail can reach triple that. It shows how supply-chain efficiency can directly lift farmer income,” Adrian said.

Kreasi Pangan is also building digital tools to track SOP steps and forecast demand, aligning planting schedules with market needs and reducing oversupply risk. Next, the company plans dedicated financing schemes to accelerate greenhouse expansion. With the right capital and mature SOPs, the model could be replicated for other commodities.

Building Resilience from the Ground Up

Adrian believes agricultural transformation can’t be achieved through short-term projects. “We have to be realistic, food resilience is built on efficient supply chains and low waste. Only after that should we talk about expansion,” he said.

Kreasi Pangan’s approach underscores that scaling horticulture is not just about production. It is about reliability, predictability, and partnership. By starting with market and logistics, the company aims to build a more shock-resistant ecosystem, an essential foundation for Indonesia’s food future.

📊 Data & Insight: Significant Financing Potential to Elevate Farmers

Data from Indonesia’s Central Bureau of Statistics (BPS) reveals a significant credit gap in the agricultural sector: a mere 18.5% of individual farmers have access to or use credit. The vast majority, 81.5%, are left financially excluded, unable to secure formal loans to address production challenges or household needs. This gap represents a major hurdle, but also a clear opportunity for financial innovation to drive change.

The main barriers are clear and addressable. Farmers cite difficult procedures (41.64%), lack of knowledge about the process (29.05%), and absence of collateral (20.51%) as their primary obstacles. These are precisely the problems that fintech and digital finance platforms are built to solve. By streamlining applications, using alternative data for credit scoring, and offering mobile-based services, these innovations can directly bypass the traditional bottlenecks that have long excluded smallholder farmers.

The future of agricultural finance is not about forcing farmers into a rigid system, but about adapting the system to fit them. Fintech can leverage data from satellite imagery, transaction histories, and mobile payments to create tailored financial products. This allows for more realistic risk assessment, competitive interest rates, and flexible repayment schedules aligned with harvest cycles, simultaneously boosting both financial inclusion and literacy.

The conclusion is straightforward: this credit gap is solvable.

While the challenge is significant, the potential for technology to bridge it is even greater. With the right innovative solutions, we can transform Indonesian agriculture. The path forward is one of collaboration—where innovator, government, and agricultural stakeholders work together to build a more resilient, productive, and financially inclusive sector. The tools to solve this problem are already here; now is the time to deploy them boldly.

⚙️ Industry Dynamics

Here are several noteworthy agriculture-related news updates from Indonesia worth exploring.

• President Prabowo Subianto reaffirmed that food security will be the central priority of his administration’s first year, calling it the most strategic pillar for national resilience. He has signed a decree to establish food self-sufficiency zones nationwide under the Asta Cita mission, aiming for full self-sufficiency by 2028 while rejecting reliance on imports. The government reported that rice production in 2025 is projected to rise 13.54% to 34.77 million tons, a milestone attributed to Prabowo’s agricultural policies. [Read More]

• ADB unveiled its 2025–2029 Country Partnership Strategy for Indonesia, aligning with the national Asta Cita agenda to accelerate inclusive, resilient, and sustainable growth through three pathways: investing in people, boosting competitiveness, and enhancing resilience and sustainability (clean energy transition, power grid modernization, and stronger energy-water-food security via higher agricultural productivity, irrigation, logistics, and support for the free, nutritious meals program), with crosscutting priorities in women’s empowerment, digitalization, governance, and regional integration. [Read More]

• Askrindo, part of IFG, is partnering with Tugu Insurance on an agritech-powered co-insurance scheme to protect farmers with modern index/parametric coverage—allowing faster, data-triggered payouts (e.g., rainfall or yield thresholds), lowering admin costs, and expanding reach. The initiative aims to boost insurance literacy and inclusion, support national food security under the Asta Cita agenda, and address climate-driven risks; Askrindo’s concept was also named runner-up in the 2025 Inclusive Insurance Challenge Fund. [Read More]

• Eratani, a farmer-centric agritech startup, has partnered with PT Casagro Futura Pratama to improve agricultural productivity and soil health in Indonesia. Through the use of Casagro’s high-carbon organic fertilizer, the collaboration aims to reduce chemical fertilizer dependency by up to 50% while boosting yields by 25–30%, based on 2024 trials. This initiative supports sustainable and climate-resilient farming practices, aligning with Eratani’s mission to enhance farmers’ welfare and long-term land productivity nationwide. [Read More]