1. Startups

Things you need to know about the Merah Putih Fund

Interview with Eddi Danusaputro, CEO of Mandiri Capital Indonesia who is also one of the committees of the Red and White Fund

The government announced the “Digital Generation Acceleration” initiative, a collaborative movement to support the acceleration of digital potential, innovation, and startup development in Indonesia. In it there are three main programs, including the Red and White Fund, Indonesia Digital Tribe, and Microcredential.

Indonesia Digital Tribe is an educational program 'skills and mindset' aims to give birth to a generation founder next. In addition, it is intended to fill the needs of talent in the rapidly growing local technology industry. Meanwhile, Microcredential is in the form of an internship program to gain hands-on experience in technology companies – synergizing with the Merdeka Campus program initiated by the Ministry of Education and Culture.

The Merah Putih Fund itself is an initiative of the Ministry of SOEs to accelerate local startups that have the potential to become unicorn. Capital provision and business collaboration will be the focus, to generate synergies in various industrial sectors.

To find out more about fund This time, we had the opportunity to talk with the CEO Mandiri Capital Indonesia Eddi Danusaputro, who is also a committee member of the Red and White Fund.

First stage managed fund

In its first phase, the Merah Putih Fund (MPF) will close managed fund $300 million or equivalent to 4,3 trillion Rupiah; supported by five SOEs including Telkom, Telkomsel, Bank Mandiri, Bank Rakyat Indonesia, and Bank Negara Indonesia. According to Eddi's explanation, later in the second phase, MPF will invite other SOEs to participate – as well as several private companies based in Indonesia, including involving the Indonesia Investment Authority (INA).

"I think MPF will focus on local companies, but will not raise funds from foreign [LPs or companies]," said Eddi.

Currently MPF is not fully operational, it has just been officially announced by the President. When later it starts working, this investment unit will led by representatives of the 5 CVCs involved in the early formation these managed funds, including from Mandiri Capital Indonesia, MDI Ventures, Telkomsel Innovation Partners, BRI Ventures, and BNI. Each will send a representative to become a 'Co-Fund Manager'.

Invested startup criteria

Eddi said that there is no target for the quantity of startups from the first managed funds recorded, the focus is on the quality of startups. With the aim of presenting unicorn new, MPF will focus on providing advanced funding, especially for startups centaur or soonicorn – which this MPF requires is above $200 million.

Ada 3 main criteria that will be required to startups that can receive MPF funding. First, the majority founder is an Indonesian citizen. Second, the company's operations [can be interpreted as the head office and main base] in Indonesia. And third, having The roadmap to do go public on the Indonesia Stock Exchange.

“Regarding the sector, we are not targeting a specific industry. All startup fields can basically be funded through fund this. However, the three conditions above must be met," added Eddi.

He continued, there is not any ticket sizes definitive for every funding which will be given later. The size will depend a lot on the agreement and needs of each invested startup.

“This has also been discussed from the start. Each of us operates CVC with a specific purpose. However, for this MPF the resulting investment decisions are collective and based on a majority vote, so it will avoid conflict of interests," continued Eddie.

Startup selection process

Later, the team involved in MPF ​​will be active, both searching for potential startups and opening opportunities for founder that meet the criteria for doing pitching. However, there is no specific activity plan that can be shared at this time.

More Coverage:

If you look at the data, according to the records DailySocial.id currently there are about 50 startups centaurs, some of which are already valued at over $500 million – just waiting funding rounds last to be unicorn.

Question The roadmap to be listed on the IDX is also an aspect that will be highly emphasized. According to Eddi, this is done to create a healthy ecosystem – investment is used as a starting point, and exit via IPO be the end point of a life cycle investation.

"Some SOEs have CVC and go their own way, through the Red and White Fund, we unite the spirit and vision to create a digital economy and a healthy digital ecosystem in Indonesia," explained Eddi.

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