In this episode, we’re back with a returning guest, Flip CEO and co-founder Rafi Putra Arriyan. Fresh from announcing their US$48M Series B round, co-led by Insight Partners, Insignia Ventures, and also Sequoia Capital, Rafi, or Ari as he is called, goes on call to catch us up on what has happened since last year, give us some updates on how Flip has grown their ecosystem since then that has led to this last round. As a leader of one of Indonesia’s earliest fintechs, Ari also shares his views on the evolution of fintech user behavior, infrastructure, and regulation over the past few years.   

They currently serve over 7 million users across Indonesia with their money transfer app, and their business solutions cater to hundreds of companies of all sizes from SMEs, all the way through to much larger businesses, across different applications from disbursement, payroll, and supplier payments. They have been recently ramping up their hiring with new initiatives in the pipeline, from business operations to product and engineering roles. Check out Flip’s career page and LinkedIn for open positions.

Timestamps and Highlights

1. 00:28 Paulo introduces Flip and Rafi Putra Arriyan (Ari); 
2. 02:38 Expanding interoperability of Flip’s money movement platform over the past year; “We are becoming the interoperability platform that could help people move money from the bank to their ewallet, from ewallet to bank, and other channels too, and not only in Indonesia, but also overseas.”
3. 03:45 The culture of money transfer in Indonesia; “We’re trying to explore more solutions because currently we are seeing the behavior is already there. [There are] lots of users that use our platform, it’s becoming very sticky, almost no churn…And the process is there, because money transfer…basically [has] become a culture here in Indonesia.”
4. 05:22 Listening to users and maturing fintech infrastructure; “The thing that we think helps us move very fast right now is not only [that] our core product is growing, but the infrastructure around us has also become more mature.”
5. 06:41 How Flip and Rafi gain insight into their 7M+ users; “Initially we only had one to 10 or 100 users, and in [the early] days, what we did before was we had a WhatsApp group together with our first users.”
6. 08:12 Evolution of fintech-bank partnerships in Indonesia; “Currently Indonesia is building some open API guidelines for the banks to follow. It will be better for us maybe in the next three to five years. We can have an ecosystem that is quite similar to India or the US maybe, where a fintech company could tap into the bank directly.”
7. 10:03 Evolution of fintech regulation in Indonesia; “…in 2017, If I remember correctly, the Bank Indonesia made a new regulation that allows KYC in an online way. And that’s where lots of fintech companies start to boom…” 
8. 11:27 Evolution of fintech infrastructure in Indonesia; “I think the biggest gap that we’re seeing right now and still not being addressed at least by any kind of player in the market right now is how we can connect our bank account to fintech or other third parties…if we have a capability to do direct debit seamlessly…it will change a lot of how we interact with digital product or features.” 
9. 13:58 How Flip is leveraging its latest round of funding; “Currently we are [also] ramping up and expanding our business outside of money transfer, but still related to what our users need. So there are going to be lots of openings that we have at least in the few months ahead to support these initiatives.”
10. 15:04 Culture of fairness and remote working; “We try to implement this fairness value in our interaction to each other, to our customer, and to our stakeholder of work…COVID happened in Indonesia and we were thinking the fairest way for us as a company to [work with] our team is [by] working remotely.” 
11. 17:56 Best practices on remote working; “The hardest one that I’m seeing is getting honest feedback from the team…[because] we hired [them] in a pandemic situation…And it’s hard for you to be honest to each other if you never meet each other.” 
12. 19:32 Joining LinkedIn’s Top Startups in Indonesia 2021; “We have a former CFO of one of the unicorns in Indonesia, and have been attracting lots of strong, product leaders, engineering leaders, operational leaders, business leaders, from all the best companies in Southeast Asia.”
13. 21:12 Attracting unicorn and top tech talents; “We have been very persistent to provide a fair financial solution for the market. And if you are doing that the right way, naturally people will take notice about what you’re doing…”
14. 21:53 Rafi’s biggest lesson from leading Flip in the last five years; “Patience is the most important thing, especially if you are coming to an industry that is really competitive like fintech…if you want to make a big impact, for sure, it will take time.” 
15. 23:53 Biggest gap in Indonesia’s fintech landscape; “They need insurance, they need investment, but they have a gap in terms of capital. They do not have that much capital to be reserved for this financial activity…but there’s also a percentage of people that still are in the process of becoming better financially.”
16. 25:25 Next five years for Flip; 
17. 26:36 Rapid Fire Round;

About our guest

Rafi Putra Arriyan started Flip after he and his co-founders spotted an inefficiency in the interbank fund transfers segment in Indonesia. With his product-centric focus and technical background, he has grown Flip to be a platform serving 1.7 million Indonesians today. He believes in using technology to automate manual banking processes and reduce the administrative costs of wire transfer. Ari holds a Bachelor’s Degree in Computer Science from Universitas Indonesia (UI), one of the most prestigious universities in Indonesia.

Transcript

Paulo: So, happy to have you back on the show, Ari, how are you? 

Ari: Yeah, I’m good. Thank you for having me Paulo, good to be back on the show again.

Paulo: Are you still based out of Depok at the moment? 

Ari: Yes, correct. Actually, our office is at Depok. 

Paulo: It’s great to know you’ve been staying safe at Depok. We will definitely talk about it as well, but really good that you’ve been able to grow the company, even as it’s fully remote. Your whole team is fully remote and that’s one of the interesting things about Flip, but, first things first, we’d love to know what has happened to Flip since June, since our conversation last year, especially from a product perspective. At the time, I think you guys were tinkering around doing remittances, and then had just launched that service.. So how is it going these days? 

Ari: We have grown quite a lot so far since our last conversation. We have grown by more than 5x Paulo. Currently, we are already helping more than 7 million people, and mostly we are thinking it happened because of the pandemic itself. There’s a behavior change in Indonesia. People [have] started to use our technology more and it became [both] a challenge and an opportunity for us, that’s helping us to increase our growth tremendously. 

So far we have [been] ramping up all our product, team, and the business too. Maybe if you remember before, we only have a domestic transfer as our product use case, but we have scaled up our remittance. And also currently we are also serving ewallet users. Currently, we are becoming the interoperability platform that could help people move money from the bank to their ewallet, from ewallet to bank, and other channels too, and not only in Indonesia, but also overseas. 

The team is growing quite a lot. We have grown by more than a hundred percent in size, and we are still looking to ramp up [in building out] our team because we have lots of exciting initiatives.

“We are becoming the interoperability platform that could help people move money from the bank to their ewallet, from ewallet to bank, and other channels too, and not only in Indonesia, but also overseas.”

Paulo: Looking back again over the past year, given your platform now has more than 7 million users as you mentioned, on your platform, are there any new interesting trends that you’re seeing in terms of the behavior of how they’re using the platform and what use cases are more popular or have shifted over the past? 

Ari: We are still seeing peer-to-peer transfer is still the most popular one, but given the recent changes in the behavior of the users, we [have] also started seeing the business use case to be growing. A lot of merchants are using our product to help their operation. And we are figuring out how to help them more.

Other than that, we’re also seeing the trend of users doing transactions at midnight. So we are expanding our capability to service [those] users better. And also we tried doing lots of experiments in terms of how we could improve the experience of the users. For example, currently we have Flip Saldo, so users can top up money to Flip, then they can use Flip basically to be like their mobile banking.

We’re trying to explore more solutions because currently we are seeing the behavior is already there. [There are] lots of users that use our platform, it’s becoming very sticky, almost no churn. That’s [what] we are seeing so far. And the process is there, because money transfer as you know, Paulo, basically [has] become a culture here in Indonesia.

Everything is being done using money transfer. If you want to pay your debt, you use money transfer to do it. If you want to send money to your family, you also use bank transfer to do that. So we are in a really interesting [era] right now, which is something that is becoming the culture in Indonesia, and we are doubling down on this product to ensure we have the best solution.

“We’re trying to explore more solutions because currently we are seeing the behavior is already there. [There are] lots of users that use our platform, it’s becoming very sticky, almost no churn…And the process is there, because money transfer…basically [has] become a culture here in Indonesia.”

Dissecting Flip’s Money Movement Ecosystem

Paulo: It’s really great that you mentioned that Flip is no longer just a product that you’re selling to people, but it’s [become] a culture that they’re adopting across the board where digital interbank transfers or money transfers have become the new normal for a lot of Indonesians. So I think these are very interesting developments, and given all of these developments, I’d like to dial back a little bit and especially for our listeners hearing you for the first time, what has been your thought process around really expanding from your initial service four or five years ago of doing these interbank transfers to now expanding all these use cases, even a little bit of mobile banking in a way, to cater to Indonesians?  

Ari: Mostly we are listening to the users’ feedback. We can’t predict the feature, right? We can’t predict what the users [will] want? And the users also do not know what is the thing that they want. So what we are doing is very simple. Actually with our initial product, we secured a money transfer, and then we [started] asking the users, is there anything [else] that we can help you with?

And that’s why there’s lots of suggestions coming in. And then we prioritize it based on the impact of the product that we want to build. But the thing that we think helps us move very fast right now is not only [that] our core product is growing, but the infrastructure around us has also become more mature.

For example, when we start Flip, there is no way for us to do proper KYC. The data that we can say as a source of truth — it’s hard to get this data, but right now we have access to get this data that’s being provided by the government. There’s lots of improvement in terms of regulation [that is] helping us to build a better product and also doing better partnerships with other financial institutions or maybe the banks. All of this [has been] helping us to build a more innovative solution for our users.

“The thing that we think helps us move very fast right now is not only [that] our core product is growing, but the infrastructure around us has also become more mature.”

Paulo: So I want to break that down into a few questions. The first is, how do you engage with these users and actually get meaningful feedback from them? Because you have about 7 million users. How do you sort of get a consensus, and decide from how they use the app and engage with [Flip]? 

Ari: The funny thing is when I talk about Flip people always think that we have 7 million users and they are always thinking that that’s a lot, and how [it is possible for us to] hear all of the feedback that the users [give]? But see, they forget that initially we only had one to 10 or 100 users, and in [the early] days, what we did before was we had a WhatsApp group together with our first users.

Until now these users are still using our product. And I’m in this WhatsApp group, getting feedback from them. Sometimes we are doing some experiments. We make a WhatsApp together with our users to get first feedback from them directly. That’s the way for me to get feedback from the users, at least, in my current role.

But currently because the team is ramping up, we have dedicated teams to do the research. We have dedicated teams to focus on product. Each of the teams have their own channel to get feedback. But as a founder currently, my phone is still in [the early] users’ phone contacts. So sometimes when there is an issue, they reach out to me directly. The first-hand feedback from users means that I can know for sure what’s happening from our users’ side. So I think that’s very helpful. The initial relationship that I have [from] the early days, gives lots of insights for me to understand what the users are thinking of right now.

“Initially we only had one to 10 or 100 users, and in [the early] days, what we did before was we had a WhatsApp group together with our first users.”

Paulo: Obviously your organization has become a lot more mature with how you guys get insights from your users and engage with them. But it’s really nice to know that you are able to still keep in contact with many of them, and even have this WhatsApp group for that, I would say, the first cohort of users. 

So you talked about users earlier, and then you also mentioned working with financial institutions, and at that time [in our last podcast], you had partnered with 14 plus banks, but now you have a lot more partners, obviously. What are your views on how banks have [evolved] in terms of their outlook on these types of partnerships and how they work with fintechs like Flip, amidst the pandemic, and, speaking of the larger topic of open finance, and startups and banks working together, what are your thoughts on that? 

Ari: We are moving towards a better way. Before people only saw banks and fintech as separate, but there’s lots of collaboration happening [now]. If you look at the market, there are lots of startups collaborating with banks by issuing maybe a joint, co-branded debit card or mobile banking and others.

And even one of the unicorns in Indonesia has acquired some bank — actually, not just one, but several unicorns in Indonesia have acquired banks, so I’m seeing this is as a good dynamic that’s happening on the market because it creates more flexibility in terms of how, as a fintech, as a startup, [we can implement] the solution for our users, because before it’s hard for us, for example, if we wanted to [enable] our users to receive money using some banks, like three to four years ago, we cannot do that yet because the bank did not have the infrastructure. 

They do not have the API for example, but currently most of the banks are already aware that they need to revolutionize the way they are doing this on the technology part. Currently, they are opening their API, partnering with fintechs and also from the regulator side, in this case in Indonesia, they are also pushing the banks to do that. 

In fact, currently Indonesia is building some open API guidelines for the banks to follow. It will be better for us maybe in the next three to five years. We can have an ecosystem that is quite similar to India or the US maybe, where a fintech company could tap into the bank directly. And then we can get the data based on the [activity] of the users, and it would be really a game-changing opportunity that the users can get from that kind of product.  

“Currently Indonesia is building some open API guidelines for the banks to follow. It will be better for us maybe in the next three to five years. We can have an ecosystem that is quite similar to India or the US maybe, where a fintech company could tap into the bank directly.”

Paulo: Speaking of regulation and working with regulators, and you’ve been a fintech for a while now, and have seen the evolution of Indonesia’s landscape. So I wanted to get your thoughts also on how regulation has evolved, especially licenses and sandboxes as well, allowing fintechs to experiment and really develop new products. 

Ari: So I started Flip in 2015, Paulo, six years ago. At that time, fintech was not a term yet, and we experienced this when we wanted to apply for a license. We had to print lots of paper, go to the regulator then they check it and then we get back, print the paper again, et cetera. And if there’s any kind of notification that we need to [send] to the regulator, we have to send it using snail mail.

Right now, at least in this year, a lot of [those processes] are not existing in the market from a regulatory standpoint. We can submit everything using online channels and connect with the regulator in a much more efficient way. Not only that, but from the core regulation itself, for example for KYC, before we started Flip, in Indonesia, we do not have any kind of online KYC regulation. So all KYC should be done offline, and it became a very big headache for us as a startup. 

And it was in 2017, If I remember correctly, the Bank Indonesia made a new regulation that allows KYC in an online way. And that’s where lots of fintech companies start to boom, and not only [KYC] all of these things are being refined right now. I believe currently we are going in the right direction in terms of regulations.

“…in 2017, If I remember correctly, the Bank Indonesia made a new regulation that allows KYC in an online way. And that’s where lots of fintech companies start to boom…” 

Paulo: That’s really great to know. And it’s not just Indonesia, but we see it all over Southeast Asia as well. And in that sense, it’s great that we’re in a very vibrant region for financial services and fintech, that all of these regulations are being made.

I think the final element that I wanted to talk about, the final tailwind that has been driving the growth of Flip and many other fintechs, is also the emergence of a lot of infrastructure built for fintechs. It could be separate startups, building infrastructure for fintechs, or even fintechs like yourselves building your own in-house infrastructure.

And we had that conversation a few episodes ago with Verihubs, with Rick talking about the layers of infrastructure that fintechs need. They’re focusing more on the verification, eKYC, all of that. From Flip’s perspective, what are the infrastructure layers that are currently solved in Indonesia, and what are the other infrastructure layers moving forward? 

Ari: I think everything is still on a work-in-progress track. Now verification is seeing lots of improvement compared to a few years ago, but there are [still] lots of gaps that I’m seeing. We are not in a situation where users could verify instantly. For example, what happened in India, you only need to input some ID and then you can be verified without needing to upload your KTP or filling in any kind of identity data.

We are not there yet, but we are moving toward that, and I’m sure when we are in that kind of position, everything will be in a different situation compared to now — in a much better situation compared to now. But I think the biggest gap that we’re seeing right now and still not being addressed at least by any kind of player in the market right now is how we can connect our bank account to fintech or other third parties.

This kind of thing is already happening a lot in the US, in India, and in other countries. But in Indonesia we are moving toward there. That’s why the Bank Indonesia is building an open API regulation that I’m assuming will help us to be closer to that kind of infrastructure later, because it will be a very big change in terms of how people will interact with other kinds of products, especially in their relationship with their money.

Currently, if you are aware, [there are] lots of products in Indonesia. There’s a gap in the way they can accept payments from the customer because currently the most popular method is still bank transfer, or [they] have ewallet on the platform, but still the experience is not really smooth and not really good from the user perspective, and I’m seeing if we have a capability to do direct debit seamlessly, connecting our bank account to the third party, seamlessly and securely, it will change a lot of how we interact with digital product or features. 

“I think the biggest gap that we’re seeing right now and still not being addressed at least by any kind of player in the market right now is how we can connect our bank account to fintech or other third parties…if we have a capability to do direct debit seamlessly…it will change a lot of how we interact with digital product or features.” 

Paulo: We talked about all of these things that have been influencing the growth of flip over the past year. And definitely a lot has changed in terms of the fintech landscape regulation wise, infrastructure wise, even the user behavior has also changed in certain ways. And your own growth as a company and see that you mentioned 5X growth, since we last talked, and a lot of investors have also taken notice, which has definitely led to the fundraise that was announced very recently. And we’re also happy to be doubling down on Flip, since our very first investment, way back. So what’s the next stage of growth for Flip, given all of these changes that you’ve been talking about? How will the recent funding that you raised fuel this next stage? 

Ari: Thank you so much, for Insignia first, to have trusted us since the early days, I believe Insignia is our first institutional investor, back in 2019 Paulo. We have been working together [through] ups and downs, since then. So we just raised a quite big amount of capital, and we are very efficient in how we are spending, but moving forward, we have three [ways] on how we are expanding our company in the future. 

First, we are planning to strengthen the roadmap, make a more solid product, and also we are going to invest more on the team, especially on our capability to build product and technology for our users. Currently we are [also] ramping up and expanding our business outside of money transfer, but still related to what our users need. So there are going to be lots of openings that we have at least in the few months ahead to support these initiatives.

“Currently we are [also] ramping up and expanding our business outside of money transfer, but still related to what our users need. So there are going to be lots of openings that we have at least in the few months ahead to support these initiatives.”

Developing a Culture of Fairness and Remote Working

Paulo: Actually that leads me to the next part of our conversation. Since you talked about opening up more roles and hiring more people, and even over the past year, you mentioned that more than a hundred percent, I think it’s like 140% team growth over the past few months, can you share with our listeners how you’ve evolved in terms of capabilities across the team how have you managed through, not just recruit, but retain all wave of new people coming into the company, especially since you guys are working remotely?

Ari: We are still learning about that, Paulo. We are not saying that we are the best at it. We are still learning, and improving what we can do. But I believe, the core thing that has helped us to have a strong team until now is because we are making a decision back then to have a value of the company that could help us scale the team in a proper way.

So at the time we were thinking that we should have a value of the company that could help us make tough decisions. And we call this value fairness. This is a value that we tried to implement, to all of our team, and [everything] that we are doing as a company. We try to implement this fairness value in our interaction to each other, to our customer, and to our stakeholder of work. So I believe that’s one of the, we can say, secret sauce, that has helped us to scale the team until now. 

But after that, you are mentioning that we are working remotely. Right now actually, that’s one of the byproducts of this value Paulo. At the time, COVID happened in Indonesia and we were thinking the fairest way for us as a company to [work with] our team is [by] working remotely. 

At the time when we are making this decision, there was a lot of pushback that we are getting from the team because they are unsure if we can do that kind of remote working, in the long run, especially on the operations team, because operations need to have the best communication, but we try to make a support system and infrastructure for us to be able to do that.

And in one week, we [were able to start] working full remotely, but after we started working remotely, there are lots of challenges happening for sure. The culture will be different compared to when we were working in the office. And also there are lots of learning that we are getting by implementing this working culture, but so far we have been doing this for almost two years and we are getting lots of good feedback from the team and based on the research that we are doing internally. Most of the people prefer to still work remotely, but still [want to] have the option to meet each other, in the office or in some co-working space.

That’s the plan that we have moving forward. We are going to implement this remote working as a culture, but we are going to build some sort of like separate office in each city that we have, because we have been working remotely, we have started to hire people, not only outside of Jakarta, but all across Indonesia and for sure as a human, we need to connect to each other offline, which we are planning to facilitate by having the separate office in each city of the team that we have. 

“We try to implement this fairness value in our interaction to each other, to our customer, and to our stakeholder of work…COVID happened in Indonesia and we were thinking the fairest way for us as a company to [work with] our team is [by] working remotely.” 

Paulo: Those are really great initiatives moving forward as we move into that post pandemic normal. And it’s also really interesting how you tied that to the cultural principle of fairness. I wanted to ask specifically, are there any interesting things that you guys do at the company or anything new that you had to do as a leader to be able to manage remote working culture or for a remote company. 

Ari: The hardest one that I’m seeing is getting honest feedback from the team, because currently 70% of our team never met each other [because] we hired [them] in a pandemic situation. We had a hiring spree at the time. There are lots of them that have never met each other. And it’s hard for you to be honest to each other if you never meet each other.

For example, if I never meet you in person, there’s a different level of trust. I think that’s a challenge that we [have been facing]. So at the time we were thinking, at least people need to know each other first before they can work in a more seamless way. So we are doing lots of initiative.

One of the most fun things that we have been doing in the past few months is having virtual lunches. So we are connecting all of the team at random. For example, one of the leaders will meet with the people that never interacted with them, for example, this person [comes from] marketing and then they get matched up with people from finance, or from legal, [because] they never have a chance to talk to each other as friends before, and having this kind of virtual lunchtime helps us to get to know each other in a more casual way.

And so far we are getting a lot of positive feedback from the team. And we are trying to make this kind of activity more frequent when, as a team, we can not only work together in a professional way, I mean, in our job, but also we can know each other in person.

“The hardest one that I’m seeing is getting honest feedback from the team…[because] we hired [them] in a pandemic situation…And it’s hard for you to be honest to each other if you never meet each other.”

Paulo: There are a lot of great practices there that the founders who are listening in or anybody who is managing a remote team can actually pick up and try out if you haven’t already, and so that we’re in the topic of culture and team development and organization. 

I also want to bring up the fact that Flip has been included in LinkedIn’s Top Startups in Indonesia this year. So congratulations on that. What do you think were the biggest factors you think that contributed to Flip being included in this list?

Ari: Yeah, we are very grateful to be included on the inaugural LinkedIn Top Startups this year. I think there are four main things that’s helped us to be included on this list. First, we have been growing very fast in terms of the payment business. I should say in the past 12 months, our team has been growing by more than 140%.

We also, as a team, have a culture where initially some of our teams started to share about the things that we are doing as a company in their own personal account on LinkedIn, and these have been getting very positive feedback from their audience and, somehow, other teammates are seeing this kind of feedback happening. And then they start to share as well the things that they are doing in Flip, for example, our GA team sent a table to our teammates’ home, and then he posted on LinkedIn and is getting very positive feedback.

It has become some sort of a loop with more people getting positive engagement from other people on LinkedIn, and then that makes our team more motivated to share what they are doing. That’s one of the things that has helped us to be included on this list. 

Other than that we are ramping up our hiring across the department right now. All of the team is [aggressive] on hiring because there’s lots of initiatives that are going on internally and currently we are very grateful that we could attract lots of top talent from the ecosystem.

We have a former CFO of one of the unicorns in Indonesia, and have been attracting lots of strong, product leaders, engineering leaders, operational leaders, business leaders, from all the best companies in Southeast Asia. And I think this also helped us to become one of the top startups on LinkedIn this year.

“We have a former CFO of one of the unicorns in Indonesia, and have been attracting lots of strong, product leaders, engineering leaders, operational leaders, business leaders, from all the best companies in Southeast Asia.”

Paulo: Just a follow up to that, what do you think is the reason a lot of the top talents, even C-level, as you mentioned, from Indonesian unicorns to actually move to Flip?

Ari: This is a team effort Paulo. We as a team are working on the same mission and I believe lots of people have been noticing that. We have been very persistent to provide a fair financial solution for the market. And if you are doing that the right way, naturally people will take notice about what you’re doing and our organization is committed to supporting our team and developing our team. And this thing is being seen by people outside, and that has helped us to attract strong, good talent, from others to join on the mission.

“We have been very persistent to provide a fair financial solution for the market. And if you are doing that the right way, naturally people will take notice about what you’re doing…”

Paulo: On that note, I’d like to shift gears back to Flip and look back at the past few years. What has been the biggest lesson that you’ve learned as CEO leading this company, as a technical founder?

Ari: I think the biggest lesson that I get right now, patience is the most important thing, especially if you are coming to an industry that is really competitive like fintech, there are lots of people doing lots of things. The industry is very noisy. And when you want to make a dent, if you want to make a big impact, for sure, it will take time.

It rarely happens that you are doing something, and in the next one, two or three months, you are getting results. It will take some time and for sure on the journey you will face ups and downs for me, at least, in facing this journey until now. I believe that’s the biggest lesson that I’ve gotten so far. 

Before, I was really a rushy person. I wanted to see results fairly quickly, but somehow it does not work at our scale. Lots of things will need time. We need to do lots of iterations. We need to hear our feedback when the feedback is not really good, and we need to accept that and improve and move on. All of these things require very high patience.

“Patience is the most important thing, especially if you are coming to an industry that is really competitive like fintech…if you want to make a big impact, for sure, it will take time.”

Future of Fintech in Indonesia and Flip

Paulo: It’s really about striking a balance with the speed with which you rolled out that product. It took only like a few months for you guys to find that product-market fit right. You were saying the previous podcast, but at the same time, you’ve also endured through the years, even as a lot more financial services have popped up.

You mentioned before that, at that time, Grab and OVO weren’t there yet, but now you have a lot more players in the landscape, and yet you guys are still there and also leading and pushing the envelope in terms of consumer financial services in Indonesia and speaking of the landscape, I also wanted to ask, what do you think are the biggest gaps in terms of Indonesia’s fintech services or fintech product?

Ari: I’m sure not many people are aware of this problem, currently, I believe the biggest gap currently is under literacy in the market. We are seeing payment, remittance products growing. But when we talk about finance, payment is only the bottom of the pyramid. There will be investing, lending, insurance, and others on top of that. And for sure, as a financial product, we wanted to help our users to fulfill the pyramid of better financial wellbeing.

The challenge that I’m seeing right now, not many people have a need for that first. They do not have a need for insurance, for example. They don’t have a need for investment, for example. But after I tried to learn more, actually they have a need for this, they need insurance, they need investment, but they have a gap in terms of capital. They do not have that much capital to be reserved for this financial activity. And also, I’m assuming this is a normal thing that is happening in a growing country. 

Indonesia is growing very, very fast as an economy right now, lots of young people are doing really well, but there’s also a percentage of people that still are in the process of becoming better financially. I think this is the thing that for sure will be in a different position in the next three to five years. And we, as the company that strives to be the solution for this segment of users, we need to invest more right now, so hopefully when the market comes already, they already have lots of good choices when they are ready to do some investment, make some insurance decisions or more. 

“They need insurance, they need investment, but they have a gap in terms of capital. They do not have that much capital to be reserved for this financial activity…but there’s also a percentage of people that still are in the process of becoming better financially.”

Paulo: I really like that proactive approach to anticipating all these, obviously incomes are rising and will continue to rise for the next few years, and once more Indonesians, I mean, we’re already seeing it, especially in a lot of urban areas in Indonesia, but I guess when it extends to a lot of different areas across the country, I am sure there will be a lot more potential for, all these other, as you say, levels of the pyramid, to attract users. So that would definitely be interesting, and on that note, would love to know where do you see Flip in the next five years? 

Ari: I think we are in a really great environment right now. Everything is moving in a better way. And we believe in the next five years, there will be a golden opportunity, not only for us, but for everyone that wants to come into the space. Indonesia will have a very strong growth in terms of economy. We are going to be one of the world’s most active digital users in the next five years, and I believe five years from now, young people will consist of one of the biggest percentages of the population in Indonesia. And startup technology companies and financial companies will be one of those getting benefits from them. 

And we hope when we are already in that kind of situation, Flip can play the role where we are building the fair financial solution for the market. We are not going to only help one segment of users. We are striving to help everyone to get access to our fair financial solution.

Rapid Fire Round

What are the top 3 skills a CEO should have? 

Ari: First is patience. I don’t know if patience is a skill or not, but I think it’s very important for patience, listening, and studying.

Any advice for early-stage tech founders raising their first round?

Ari: Maybe it is counterintuitive. I believe for the first round, you should focus on your product first, rather than focus on finding the investor. Because if you have a strong product, the investor will come, of course, if you are lucky. 

We’ve all been students once (and always are arguably) — most memorable class you’ve been in?

Ari: Learning sign language. 

Paulo: Have you ever had to use it for anything Flip related? 

Ari: Not really, but it helps me put [see the] perspective of others better, because basically when we are building a product, you are not only building it for yourself. There’s lots of users that are going to use our product and it helps me to put myself in other people’s shoes in different ways.

What do you do to de-stress?  

Ari: I play video games.

Paulo: What’s your favorite video game to play? 

Ari: I like to play Dark Souls. Basically I love all games from software. Dark Souls is one of the favorites. I’m really looking forward to the Elder Ring next February.

Anything else you’d like to share / promote? 

Ari: I would like to double click again on the initiatives that we have moving forward. We are really grateful that we have been supported so long from Insignia, Sequoia, and Insight Partners, in our previous round, and currently we are in a really strong position right now in the market and we are ramping up our hiring initiative, not only for the business operation, but also on the product and engineering roles. So please check out our career page and LinkedIn.

To all our listeners, this is the final episode for season three of On Call with Insignia Ventures. So this season has been going on over the past year, and we’d really like to thank all of our listeners, who have supported us throughout this whole season, tuned in to all these great conversations that we’ve had with founders and investors.

We’re all looking at Southeast Asia as fast emerging technology markets. And while we’re preparing for season four next year in 2022, in the meantime we’ll be putting up some really great compiling of all the best bits from this past season, so I’m looking forward to the next season, which will come around February next year. And in the meantime, I’m looking forward to sharing our season-end compilations with you all. Once again, thank you for tuning in to On Call with Insignia.