Four to five years ago, corporate venture capital (CVC) is a relatively new phenomenon in the Indonesian startup scene, where many domestic corporations are starting to enter the realm of digital business funding. Judging from the climate outside Indonesia at that time, the shape venture capital this one looks to have been a progressive trend.

This trend can be seen from the positive growth rate globally. According to data CB Insights, CVC's contribution to the investment ecosystem venture capital (VC) globally is always increasing; it can be seen from the total participation of CVC in all VC funding as much as 16% in 2013 and 23% in 2018. Also, the trend of active CVC funding increased by 47% from 2017 to 2018.

The figure above shows CVC's power and efforts to continuously improve the health of the technology business ecosystem, which is also of course in line with CVC's goal to connect the best innovations with business and market access from the parent company. Thus, it is important to further examine how the profile and potential of the parent company can then contribute to startups through CVC, especially large corporations with CVC that are still relatively green.

One of them is PT Bank Rakyat Indonesia Tbk (Bank BRI) which in the third quarter of 2019 launched the Their CVC is BRI Ventures. BRI Ventures CEO Nicko Widjaja said that although BRI Ventures is relatively new in exploring the investment area of ​​the digital world--with a rich team of experience and insight--but he believes that execution speed is the best way to have the best impact on innovation. So, what are the tactical steps of BRI Ventures as a relatively new CVC to be able to participate in developing the startup ecosystem?

CVC's vision of investing in digital business

As mentioned at the beginning of the article, the entry of corporations in the form of CVC into the digital innovation business pool has been the talk of the past half a decade or so. BRI Ventures is clearly still young when it comes to the startup and technology jungle, especially with a holding company that is one of the largest and oldest in the industry.

Continuing what Nicko said regarding the presence of BRI Ventures in the industry, Markus Liman Rahardja, VP Investor Relations and Strategy of BRI Ventures, doesn't mind at all if you have to step on the pedal as hard as you can to move forward to speed up the renewal of Bank BRI.

“Because BRI Ventures exists to accelerate innovation from outside (BRI Bank) and do things that cannot be done inside (BRI Bank). BRI Ventures will take on the role of innovation liaison, where later the innovation can come from BRI Bank or related startups, so that we are all always ready to face this industry which is naturally constantly changing, "said Markus.

By brand imageBRI Ventures may be considered new, but the individuals behind it are veterans in the digital, innovation, and technology sectors. In addition to Nicko, Markus, and VP Investment of BRI Ventures William Gozali, who has more experience in the industry (both from the perspective of founder and VC), BRI Ventures is also mastered by the founder Indra Utoyo, Director of Digital, Information Technology and Operations at Bank BRI, who is also known for his long experience in making strategic decisions in corporations with a focus on technological innovation and collaboration.

Together with these figures in the main team, BRI Ventures takes on the role of CVC that builds a comprehensive digital ecosystem. The existence of Bank BRI as a holding company certainly invites the initial assumption that BRI Ventures support is more focused on the financial industry (specifically fintech).

“We will enter not only in the financial industry, but also in emerging ecosystems others, of course by looking at digital innovations that have great value. It's just that, we hope valueit's really real, not numbers and made up stories. Real people, real work, real customers, and relevant value propositions, said Mark.

CVC in general will want to be connected to the main business of the group. Bank BRI and BRI Ventures certainly have similar expectations, with high innovation values ​​covering various digital industry sectors. “BRI is currently an integrated financial solution. BRI Ventures wants to be an integrated digital ecosystem,” said William, reinforcing Markus' statement regarding the vision of BRI Ventures.

CVC for Indonesia's digital ecosystem

Working with financial services giants in Indonesia, which is relatively old, still allows BRI Ventures to move freely in making commitments to the technology ecosystem, with two functions that become the main umbrella for collaboration, namely the Digital Center of Excellence (DCE) function for collaboration with fintech and the Technology Cooperation (KJT) function for collaboration with non-fintech.

“So when asked how far the collaboration is, at least we have a commitment by having a specific team, whose job it is to collaborate with banks. In today's era, not everything can be run alone, "said Markus.

A real case of collaboration between Bank BRI and the technology ecosystem led by Markus is Indonesia Mall. The collaboration, which was launched in April 2018, is a collaboration program between Bank BRI and several leading e-commerce companies in Indonesia (Tokopedia, Bukalapak, Shopee, Blibli, and Blanja) in creating official online store of selected MSME products.

“We do not have the resources in the form of expertise, logistics, and capital in terms of e-commerce. So, instead of making E-commerce alone, we prefer collaboration. We execute things that we can collaborate on to accelerate innovation and we will think about the form of cooperation," said Markus.

Bank BRI's commitment to the collaboration planned by BRI Ventures can be seen from funding worth $250 million such as ever mentioned. With resources equivalent to Rp3,5 trillion, BRI Ventures' immediate focus is to manage its portfolio, especially to embrace ecosystems outside of fintech.

“This ecosystem includes agriculture, maritime, health, education, tourism & travel, transportation, creative industries, and retail. We're opportunistic in numbers, so we're not aiming for how much deal, "explained William.

The current focus of BRI Ventures collaboration is at the growth stages, where the startups they are after are those that already have a product and a business model. “We have made an assessment with a number of startups. Only the announcement can not be direct. Until the end of the new year, LinkAja has been announced. Actually there are several more startups that we are evaluating. This year, we are in the final stages of 4-6 startups, we will announce the details at a more appropriate time,” continued William.

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Disclosure: This article is sponsored content endorsed by BRI Ventures.