As part of the European Indonesian Business Network initiative "Gateways to ASEAN: ICT Opportunities in Indonesia", had a chance to travel to the Polish cities of Warsaw, Wroclaw and Poznan to share with Polish entrepreneurs the challenges and opportunities of conducting business in Indonesia. The main topics of conversation included Digital, Mobile, FinTech Development & Logistics. The discussions focused on providing attendees with practical perspectives on where the ICT business potential of Indonesia lies and what is to be expected when choosing to enter the country's high potential market. The ICT Business Opportunities in Indonesia sessions have the support of the Polish Agency for Enterprise Development (PARP), and are co-organized by the Polish Chamber of Commerce (in Warsaw), the Wroclaw Center of Technology Transfer (in Wroclaw) and the Poznan Science and Technology Park (Poznan).

1. Indonesia & Poland
Technology & The Future

2. Who am I?

3. Who am I?
Piotr Jakubowski
@piotrj
Born in Indonesia
Finished primary education in
Indonesia
University & work career in
Chicago, New York & Tokyo
Native Bahasa Speaker

4. Who am I?
Returned to Indonesia in 2011
Specialization in digital advertising
industry (Strategist & General
Manager)
Silent investor & advisor in startups
doing business in Indonesia
Advisor with SHARE Foundation
since 2014

5. Share Foundation

6. As the name implies –
SHARE Foundation is to
share polish information
technology as well as
knowledge and
experience of polish
developers and coders
with Southeast Asia, as
we believe that good
once shared, comes back
from recipents sooner or
later, so we warmly
welcome and support SEA
IT in Poland too.

7. In order to put into
practice the idea, we
have formed SHARE as a
non-profit Organization -
specifically to faciliate
the transfer of
information technology
and human resources
between Southeast Asia
and Poland, as a main
activity.
More about us:
www.sharefoundation.co

8. Indonesia: Quick Facts

10. JAVA
143 million people
1,117/km2
POLAND
38 million people
123/km2

11. JAKARTA
30 million people (11m city)
4,383/km2
(14,440/km2
city)
WARSAW
2.6 million (1.7m city)
631/km2
(3,304/km2
city)

12. JAKARTA
30 million people (11m city)
4,383/km2
(14,440/km2
city)
POLAND
38 million people
123/km2

14. 26 MILLION MOTORCYCLES

15. Digital & Tech
Landscape

16. POPULATION: 255 MILLION
ACTIVE INTERNET USERS: 72 MILLION
ACTIVE SOCIAL MEDIA ACCOUNTS: 72 MILLION
MOBILE PHONE CONNECTIONS: 305 MILLION (128%
PENETRATION)
ACTIVE MOBILE SOCIAL CONNECTIONS: 62 MILLION
SOURCE: WE ARE SOCIAL

17. DIGITAL NATIVES
OVER 50% OF INDONESIA’S POPULATION IS UNDER THE AGE
OF 30
SOURCE: APJI, PROFIL INTERNET INDONESIA 2012

18. TIME SPENT WITH MEDIA - DAILY
AVERAGE INTERNET USE (PC): 5H 06M
AVERAGE INTERNET USE (MOBILE): 3H 10M
AVERAGE SOCIAL MEDIA USE: 2H 52M
TELEVISION VIEWING TIME (INTERNET USERS): 2H
29M
SOURCE: WE ARE SOCIAL

19. INTERNET USAGE
ACTIVE INTERNET USERS: 72 MILLION
INTERNET PENETRATION: 28%
ACTIVE MOBILE INTERNET USERS: 54 MILLION
MOBILE INTERNET PENETRATION: 21%
SOURCE: WE ARE SOCIAL

20. SHARE OF WEB TRAFFIC
DESKTOP/PC: 45%
MOBILE: 50%
TABLET: 4%
OTHER: 0%
SOURCE: WE ARE SOCIAL

21. ONLY ONE WORD MATTERS
MOBILE

22. MOBILE PHONES
NUMBER OF SUBSCRIPTIONS: 308 MILLION
MOBILE PENETRATION: 128%
PERCENTAGE OF PRE-PAID CONNECTIONS: 99%
PERCENTAGE OF POST-PAID CONNECTIONS: 1%
PERCENTAGE OF 3G/4G CONNECTIONS: 34%
SOURCE: WE ARE SOCIAL

23. MOBILE ACTIVITIES
SOCIAL MEDIA APP USE: 14%
MOBILE VIDEO WATCHING: 11%
MOBILE GAME PLAYING: 10%
LOCATION BASED SEARCH: 9%
MOBILE BANKING USAGE: 11%
SOURCE: WE ARE SOCIAL

24. LET’S TAKE A LOOK AT
SOCIAL MEDIA

25. SOCIAL MEDIA ACCOUNTS
SOURCE: WE ARE SOCIAL

26. TOP ACTIVE PLATFORMS

27. TOP ACTIVE PLATFORMS

28. E-COMMERCE BY DEVICE
SOURCE: WE ARE SOCIAL

29. Digital & Tech Landscape:
E-Commerce

34. 70% OF E-COMMERCE
ORIGINATES FROM
RURAL AREAS
SOURCE: TECH IN ASIA

38. 78% - FASHION
46% - GADGETS
43% - ELECTRONICS
39% - BOOKS & MAGAZINES
24% - GROCERIES

41. Digital & Tech Landscape:
FIN-TECH

42. Per capita GDP and Internet penetration percentage
Developed Market
20%
of retail shopping
is online
Emerging Market
<1%
of retail shopping
is online
Indonesian e-commerce and online transactions
in general is still newly nascent.

43. 43
80 mil
Internet users
55 mil
Consumers joining
middle class
35% growth
in mortgage lending
Indonesia’s demographic bonus.
Millions of young people joining the middle class, going online
and beginning to save and consume.
$ 565 bio
Forecasted size of
savings and
investment market in
2030
50%
of population is
under 30 years of age
24% growth
in insurance
premiums
26% growth
in consumer lending
22% growth
in Credit card
transaction value

44. Before e-
commerce
After e-
commerce
Macro story: technology-
enabled society evolving
from “push” to “pull” with
the individual dictating
what, when, where and how.

45. 45
Connectivit
y
Logistics,
Human
Capital, and
Last Mile
Payments
Structural Root
Issues…
Paper-
based
systems
Lack of
infrastr
ucture
Antiquat
ed
regulati
on
Low
Trust,
poor
consume
r
protecti
on
PoorPoor
nationalnational
educatioeducatio
nn
standarstandar
dsds
Growth constraints for Internet business in
Indonesia

46. 46
But the winds of change are
blowing…
ICT
Initiative
s
eServices
Business-
friendly,
from our
industry,
open to
innovation
Mobile
Payment
eVoting,
eTax,
eApplicatio
ns,
eHealth

47. 1,000,000 families to
get Cash Aid USD
20/month
Distributed via Mobile
SIM Card!
#SUPERCARD

48. 48
E-
Money
vs
Paper/
plastic
P2P
paymen
ts
vs
Cash
Custome
r
data
safety
Vs
No
custome
r
data Big
data
analyti
cs
vs
Guess
work
Persona
lized
product
s
vs
One size
fits all
Lower
loss
rates
vs
High
NPLs
Faster
transa
ctions
vs
Go to
branch
E-
Applica
tions
vs
Wet
signatu
re
FINANCIAL
TECHNOLOGY
Financial Technology is a structural pillar that enables
scalable innovation.

49. 49
NOT THIS INNOVATION
NOT THIS INNOVATION

50. CLOSER TO HOME

51. 51
kyat Indonesia (BRI) :
vans + 10K permanent branches
micro lending alone (7M micro credits customers)
pportunity : USD 50B/year
ng is proxy for branchless banking with massive op
FinTech-enabled innovation –
what is needed?
Full-service branchless banking, microfinance,
inclusion

52. 52
BANKED:
40% of Indonesian Adults
1600 microbanks, few hundreds multi finance
FinTech-enabled innovation –
what is needed?
Credit Scoring for Banked and Non-Banked Data Sources
UNBANKED:
60% of Indonesian Adults

53. 53
FinTech-enabled innovation –
what is needed?
True Digital & Mobile Payment

54. 5454
BBM
MONEY
FinTech-enabled innovation –
what is needed?
P2P payments and money transfers

55. 55
Consumer lending market : USD 120B (12% CAGR)
Retail Insurance : USD 40B (15% CAGR)
Life Insurance : USD 20B
FinTech-enabled innovation –
what is needed?
Online Comparison, Brokerage & Transparency

56. 56
Center for Middle Class Consumer
Studies /CMCS (2013):
“The wealthier Indonesian moslem are, the more religious
they become”
87%
of middle class
in Indonesia are
Moslem
2012
(mn people)
2020
(mn people)
Jump 26.6mn
Jump 26.1mn!
Jump 36.2mn!
BCG Report
FinTech-enabled innovation –
what is needed?
Indonesian Moslem Middle Class Consumer

57. 57
rently only has around 5% market size
Islamic Banks are growing faster than
Conventional Banks in Indonesia
Statistik Perbankan Syariah 2014

58. 58
Structura
l
solutions
for the
e-
commerce
industry
Enable
creative
producers
like games
and music
to gain
truly
mass
distributio
Enable
developme
nt (mass
market
remains
largely
unbanked)
Impact of fintech
Enable
SMEs and
the small
businessm
an

59. Digital & Tech Landscape
Mobile

65. Knowledge sharing:
Polish ict in indonesia

66. Polish ICT
in Indonesia

73. „There are two reasons why I believe
Indonesia is one of the most important
markets to enter. From hiring
standpoint, there is already a
substantial amount of talent based in
Indonesia. More importantly,
Indonesia is a booming economy.
Early presence might convert to a
leadership status in following years
for any company entering Indonesian
market.”

74. „Poland is known for big number of
excellent engineers and Polish
companies - for ability to build great
products and outstanding IT solutions.
Indonesia on the other hand, is a
growing, booming market which has a
great need for technology to solve
even the most simple challenges.”

75. Doing Business
in Indonesia

76. „Developing a
startup in
Indonesia is fun.
Emerging
markets tend to
have relatively
high barriers to
entry, but these
can be
construed as a
competitive
advantage to
those savvy
enough to
successfully
navigate them.”

77. 7 challenges of ict business in indonesia

78. 1. Infrastructure
17,000 Islands, lack of roads, transport, etc

79. 1. Infrastructure – connectivity
300 million mobile connections, more data

80. 2. Fragmented audiences
17,000 islands, 700 languages, 300 ethnicities, 6 religions

81. 3. E-Payments
distrust of online payments, cod and transfers still rule

83. 8 million credit card holders in indonesia

84. 4. Permits & Regulations
53 business days to set up a company (Poland: 30)
107/175 on transparency.org corruption index (Poland: 35/175)

85. 5. Enforcing contracts
Indonesia ranks 114 of 185 according to world bank “Doing
Business” Rankings

86. 6. Talent
good talent is difficult, but not impossible to find
currently, only 36,000 students are studying abroad

87. 7. People business
indonesians are a very collectivistic society, and favor personal
relationships (both clients and employees)

88. The good news:
Opportunities for ICT in indonesia

89. 1. Growth potential
20% of population is online…

90. 2. Government support
ICT Minister Pledges $1 billion support for startups

91. 3. Technology is the solution
17,000 Islands, lack of roads, transport, etc

92. 3. it’s working…
jakarta – smart city

93. 3. it’s working…
go-jek: Formalizing the “ojek” industry

94. 3. it’s working…
go-jek: Formalizing the “ojek” industry

96. 3. it’s working…
co-working spaces: Jakarta

97. 3. it’s working…
co-working spaces: BALI

98. THANK YOU & LET’S
DISCUSS