Opportunity in Indonesia’s digital economy

THREE years ago, Singaporean Jason Lim was working in a multinational corporation in Jakarta when he saw a business opportunity in Indonesia's emerging digital economy.

He quit his job to strike out on his own and, today, his online gaming and e-commerce start-up Yogrt has more than eight million users in Indonesia, a number that is growing.

Asked why he ventured into the digital and mobile application business in Indonesia, he said that for his mobile apps to be successful, he needed a market with a growing middle class which has a high adoption of mobile devices.

"It has more than 100 million Internet users, and about half use smartphones, that is why most start-ups set up shop in Indonesia."

Lim is not alone. Carlson Lau, chief executive of EV Hive, which operates a co-working space in Jakarta, said opportunities in Indonesia's digital economy sector are growing fast.

“One of the things I love about this country is that it is very 'social', people like to get together off(line) and online," he said. "If someone else is doing something new, it catches on very quickly."

Yogrt and EV Hive are just two of many Singapore startups that have found success in Indonesia, and the two governments now want to see more such collaborations.

Indonesia, according to Lim, is still riding the wave and growing.

"I started with social networking and now I do mobile games and e-commerce; soon we will go into e-payments," he said.

Indonesia has more than 250 million people, a quarter of whom are under the age of 30. They are fast adopters of new technologies and form an important customer group in the digital economy, say analysts.

A key challenge, however, is the lack of talent, especially of IT developers, and this has prompted digital companies to look overseas in countries such as China and India.

Singapore could work with Indonesia on human capital development to support and enable the start-up ecosystem.

Temasek Foundation International and Singapore Polytechnic have been working together with IT lecturers from the Batam State Polytechnic to conduct train-the-trainers programmes. They will also carry out the programmes for IT lecturers across public institutions next year, after having completed two rounds of training this year.

In May, Singapore and Indonesia held a coding competition which attracted more than 500 participants. — The Straits Times/ANN