Wempy Dyocta Koto does not come across as an investor who’s just dabbling in Indonesia. As CEO of Indonesia’s Systec Group and its venture capital arm, Koto’s approach to Asia’s tech startup business seems methodical and calculated. Koto claims to operate under a few key business maxims that he believes hold true over any single piece of data available in Jakarta’s market.
“Indonesian startups think they need money. However, what they need firstly, is education,” explains Koto. “They need to understand the rules that govern the startup ecosystem. […] I have discovered and uncovered dramatic tales of startup chaos, conflict, and confusion.”
Koto looks good on paper. With the exception of the past two years, his education and experience comes completely from overseas. He has already made his marks in Sydney, Singapore, Hong Kong, London, and San Francisco; Koto has held managerial roles in global ad firms like Ogilvy, Young & Rubicam, and Wunderman. He’s assisted on digital communications assignments for Microsoft, Samsung, Sony, LG, American Express, Citibank, and BP. Koto’s list of business accolades and affiliations goes on, and according to him, his rolodex is a “who’s who” of royal figures, big-name CEOs, and high-net-worth individuals around the globe. But Koto’s latest frontier is Indonesia’s tech startup scene.
See: Why Indonesia is an upcoming tech market that can’t be ignored
Tinkering with startups
In 2013, Koto was approached by Muhammad Ajie Santika, the Bandung-based CEO of the now well-known Tinker Games. Koto recalls that despite Tinker being named by the Indonesian government in an official creative economy initiative and receiving US$100,000 from Systec Group the year before (when Koto wasn’t with the firm yet), Tinker was on the verge of bankruptcy. He explains:
I studied their talents and assessed their global opportunities. I then placed Ajie and the Tinker Team on a prescriptive program. I told them that they must follow 100 percent of my instructions if they are to turn the company around. […] They were not allowed to question or challenge my requests. They were only allowed to execute. […] What I say, they must do. Today, one year later, Tinker Games is one of Indonesia’s and Asia’s premier game companies, and sitting in their bank account from games sales and projects is approximately US$800,000.
Wempy Dyocta Koto, CEO of Systec Group
After helping Tinker, Koto joined Systec Group full-time as chief marketing officer. Four months later he grabbed the CEO position. While Koto’s experience is largely outside the realm of tech startups, he confirms that Systec Group is fully focused on digital investments in the archipelago. According to him, that means the firm must focus solely on the domestic market.
While Koto is a busy guy, to one degree or another, he has a hand in running all of Systec’s portfolio companies. Local men’s media portal TalkMen and automobile website Speed Architect are Systec’s consumer brands, while the firm’s business-to-business portfolios include names like Teknologi Mitra Solusi (TMS) and HyperNet. TMS focuses on digital customer loyalty for clients like KFC, while HyperNet – one of the Indonesia’s largest internet service providers – serves brands like McDonalds, JCo, BreadTalk, and Novotel. HyperNet also powers national concerts and events that come through Indonesia, including Taylor Swift, Bruno Mars, the Chelsea Football Club tour, and Metallica.
Systec’s other portfolio companies include the interactive digital advertising signage firm Touchpoint, and Karnivall, a local mobile app developer and publishing company, among others.
Decentralizing Indonesia
When asked which Asian startups excite him in particular, Koto isn’t shy about his enthusiasm for the future of Paul Rivera’s company, Kalibrr. Kalibrr is a Filipino company focused on the skills assessment and talent acquisition industry, and is, for now, Asia’s only startup to enter Silicon Valley’s Y Combinator program.
Koto also voices his admiration for Indonesia’s Hanifah Ambadar of Female Daily Network, who recently received a US$1 million funding round, as well as Muhammad Alfatih Timur and Vikra Ijazz of local crowdfunding site Kita Bisa.
“One other phenomenon that excites me is the decentralization of startups rising in Indonesia,” adds Koto. “With my national travels, I have met wondrous regional non-Jakarta startups trying to disrupt the national landscape. Jakarta will soon be blindsided by various startups emerging from Makassar, Medan, Semarang, Bandung, and Surabaya.”
Nuts and bolts
Koto says that Systec Group’s VC is funded by himself, his partners, and other high-net-worth Indonesians. He did not mention how much money was inside of Systec’s fund, but he did say that his partners prefer to remain behind the scenes to better manage the firm’s finances and operations. Koto is the public face of Systec, overseeing the firm’s outreach to entrepreneurs across Indonesia.
Koto says investments into his portfolio companies tend to start as small as US$100,000 to US$500,000. For companies that are scaling up and monetizing, Systec has injected over US$1,000,000. According to Koto, the sweet spot for Systec’s pre-series A investments is around US$250,000.
However, he maintains that money is the least important item on the docket for local startups at this point in Indonesia’s tech history. He says:
We cannot bring to life, empower, or repair the national startup ecosystem without travelling and starting at the grassroots level. The startup ecosystem is still at its infancy in Indonesia. We will only attract major international funds once we elevate the quality of our entrepreneurs. That all starts with education. […] Our thesis is to invest in visionary leaders who aim to digitally disrupt the status quo.
See: Monk’s Hill Ventures and Stefan Jung set up shop in Jakarta
This post Systec CEO Wempy Dyocta Koto on Indonesian startups and disrupting the status quo appeared first on Tech in Asia.
Systec CEO Wempy Dyocta Koto on Indonesian startups and disrupting the status quo
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