On the heels of the world’s largest single day elections, we review the stories of two companies maturing the infrastructure and productivity of the country’s supply chain, often pointed to as one of the more difficult aspects of the country to digitize with its geography, but just as massive of an opportunity

One is AwanTunai, digitizing the traditional FMCG supply chain with its proprietary ERP software, which in turn enables them to provide automated and reduced risk embedded financing for inventory purchase in the historically challenging but economically important micro-SME space, which contributes more than 60% to Indonesia’s GDP.

The other is Shipper, providing end-to-end digital supply chain solutions for businesses of all sizes. These solutions, ranging from ecommerce management for small sellers to bespoke transport services for enterprise, are integrated into the company’s logistics network of 3PL providers, first-mile delivery agents, micro-fulfillment hubs, and 140+ warehouses spread across the country. Among other efficiencies, their services reduce barriers to entry and logistics costs that represent 23.5% of Indonesia’s GDP

Very different businesses, but ultimately shaping the way businesses are able to leverage the growth of Indonesia’s supply chain, whether it’s access to previously high-risk, high-interest capital or greater distribution

And there are more these companies and their CEOs (AwanTunai’s Dino Setiawan, and Shipper’s Phil Opamuratawongse) share in common:

L-R: AwanTunai CEO Dino Setiawan and Shipper CEO Phil Opamuratawongse

(1) Both entrepreneurs came from the Valley.

Born in Thailand, Phil was a VC at Floodgate who returned to Southeast Asia looking for new opportunities as an entrepreneur.

As Phil shares on our podcast back in 2020, “I think [Southeast Asia] is a world where a lot of impact can still be created…the next billion users are right here. They’re not in the mature markets anymore. If you go to these big technology companies and ask where’s your next source of revenue, it’s the next billion users, Indonesia being a big part of that. And it’s extremely difficult to crack. So I think it’s important to be in the region to try to solve those problems.”

Dino on the other hand returned to the region fresh from a alternative data-based underwriting fintech venture he had built and wasn’t quite ready yet to jump into another startup.

As Dino shares on our podcast back in 2020, “I really broadened my horizons [at Stanford] and that’s where I was first exposed to fintech because 2011-2012, that’s when peer to peer lending was really starting to take off in the US with Lending Club and Prosper. Now I’ve started to learn a lot more about fintech so I spent an additional four and a half years in the Bay Area, right in Palo Alto, really running a kind of alternative data based underwriting financial inclusion fintech platform. And, fast forward 2016 for personal reasons I came back to Asia.” 

(2) What drew both into their next ventures was trust in their partners.

Dino came across Rama who had just left his post as CPO at Gojek and had begun to experiment around more equitable lending and building a digital rural bank. Despite his reservations, Dino was drawn by Rama’s mission of financial inclusion (not unlike his own back in the Valley) and capabilities as an engineering leader.

As Dino shares on our podcast back in 2020, “I actually wasn’t quite ready to do another startup from scratch. I know how much hard work that involves, but here before me I had Rama, who was one of the dream technical co founders anyone could ask for. He had an engineering team with him. And it was really just all the right ingredients, especially given the opportunity in Indonesia, to really start again and launch another startup.”

Phil on the other hand was exploring opportunities with us at Insignia until he found family in Budi Handoko, already a portfolio founder at the time, and Shipper, already a digital 3PL aggregator platform for small sellers.

As Phil shares on our podcast back in 2020, “The first reason is coming to Indonesia or Southeast Asia broadly, my family’s from Southeast Asia. They’re right around the corner in Bangkok. I spent significant time here during my childhood.

So that was definitely a push for me. But speaking of family, I think, Budi Handoko, who is my partner on this journey to build Shipper. You know I consider him family and he was also a big push as well in that kind of family bucket. You see, I had the support from my family, including Budi as well, people who I trust, people who I can really trust in embarking this journey so that gave me the confidence in doing this…

knowing that there was an ecosystem and there are folks like Insignia who supported entrepreneurs was a big draw for me, you know, I felt like there are always people who I can rely on and lean back and get support from if anything ever happened.”

(3) While the pandemic posed different challenges for both companies (repayment pressures for AwanTunai, and high ecommerce demand with supply chain constraints for Shipper), this period of greater uncertainty was when both companies unlocked new capabilities that have paid off in the long run.

To de-risk uncertainties in the pandemic, AwanTunai built its proprietary ERP (after previously digitizing supplier data) and also began servicing the demand for larger-scale SME financing for suppliers, not just the FMCG MSMEs they originally served. They also began developing proprietary credit risk assessment (they have patents!) These developments enabled AwanTunai to significantly expand its loan book and set new standards in the industry for financing.

As Dino shares on our podcast in 2021, “Initially, we thought that our supply chain financing would be more for the micro SME market. However, due to the unexpected pandemic effect, customers came to us wanting larger-scale SME financing, which led us to design a product specifically for the supply segment…Now, our product is highly sought after by our banking partners.”

With greater demand for more efficient ecommerce logistics, Shipper expanded its network of warehouses, which allowed them to venture further into serving larger customers, and made key acquisitions that grew their logistics network and brought in new leadership.

As Budi shares on our podcast in 2021, “Warehousing is [due to the reality], as I explained earlier, that the growth of e-commerce actually has been quite good for certain customers and they need some fulfillment services, so then they would store goods in our warehouse…the larger businesses come to our warehouse, mainly because the agent network has limitations in capability. They’re not able to deliver 50 parcels or 100 parcels at one point because they are using motorbikes. So they become a problem in the SLA and that’s why we believe with warehousing solutions those [issues] can be resolved.”

(4) Both companies have come a long way in playing their roles as growth enablers in the Indonesian economy.

Today, Shipper has a network of 300+ warehouses, working with 4000+ businesses, serving more than 500K customers per month. In 2023, Shipper partnered with 500 enterprises to fulfill over 20 million orders to over 10 million customers.  They also strengthened their position in the industry in last year’s Legendary Brand Festival, supported by the Indonesian government and played host to many of the country’s legacy and emerging brands.

AwanTunai is today present in 19 major cities across Indonesia, with more than 400 wholesaler partners and continuously expanding. By the first half of 2023, they had facilitated over 3 billion USD in sales, enabling them to lend well over 800 million USD on an annualized basis. They are registered and supervised by the OJK and are an active member of the Indonesian Joint Funding Fintech Association. They have also been recognized for their financial inclusion work by the UNDP and most recently in Davos.

In 2023, the company was also ranked in the top 50 High Growth Companies in APAC by the Financial Times. Most importantly, their business has enabled suppliers in their network to grow 4-5x or even more.

(5) This impact would not have been possible without the people the organization has brought in over time.

From former Tokopedia product and engineering leaders like Smiley and Marvinus to seasoned entrepreneurs like Jessica who joined them via acquisitions, Shipper has had leaders able to strengthen their technological and distribution backbone critical to differentiating their services in the market.

AwanTunai on the other hand is led by experienced executives from Morgan Stanley, McKinsey, Gojek, and Microsoft, and works closely with regional banking groups (MUFG, OCBC), as well as the largest local institutions (Bank BRI, Bank Mandiri). Critically, their talent are some of the most experienced in data science (like Yi Ling) and credit (like Christian Chandra).