MDI Ventures Immediately Announces Third Investment Fund, Targeting 1,4 Trillion Rupiah

MDI Ventures, a corporate venture company Telkom Group, revealed that it is in the process of raising its third investment fund with a target value of $100 million (more than 1,4 trillion Rupiah). This time, MDI involved foreign investors as LPs, one of which was revealed: Kookmin Bank from South Korea.

To DailySocial, Principal and Head of Investor Relations MDI Ventures Kenneth Li confirmed that Kookmin Bank is one of the LPs that will enter the third investment fund from MDI Ventures. However, the agreement between the two has not yet reached the final stage.

He also could not confirm whether Telkom would return to the new investment fund or whether it would come entirely from foreign investors. Apart from Kookmin Bank, his party is exploring LPs from the Middle East and several Southeast Asian countries, such as Thailand and Singapore.

Kookmin Bank's debut in Indonesia began with entering as a new shareholder in Bank Bukopin. One of the largest banks in South Korea, it bought 22% of Bank Bukopin's shares worth 1,46 trillion Rupiah last year.

"Kookmin is one of the investors who entered fund our latest, but still finalizing. The investment fund target that we want to manage this time is $100 million, equivalent to fund first," he said, Friday (13/9).

MDI Ventures' decision to open to outside investors is actually a new thing. Initially, the company pocketed an investment fund of $100 million entirely from Telkom. Then, in the second stage, it comes from the subsidiary Telkomsel, Telkomsel Innovation Partner (TMI), for $40 million in May 2019.

MDI Ventures wants to open the gate to outside investors who have been stuck when they want to enter Indonesia. They know about Indonesia thanks to the names of unicorns that are often mentioned by the outside media, but are still not well known.exhibits with other local startups that can be invited to collaborate.

The strategy chosen by MDI Ventures this time is arguably following in its footsteps Softbank. At first SoftBank used its internal funds to invest in technology companies. After their success, they are determined to launch various high-value investment funds because they are filled with well-known foreign LPs.

Managing funds from outside investors is not a major challenge for MDI Ventures, although this is the first time. Kenneth believes that the company's performance and track record proven since operating in 2015, it can make investors confident in the company's ability to manage investment funds and can provide promising returns.

MDI Ventures so far manages 35 portfolios spread across 10 countries, totaling five exit. Some of them have IPOs abroad, such as Geenie on TSE (Japan stock exchange) and Whispir (Australian stock exchange).

"From track record MDI, we know how exit the right one because the investor is still looking for return. But we don't want to be there. How can we collaborate further with investors, MDI is the initial phase and partner to help them enter Indonesia."

Next plan

Telkom, as the parent company, has given its blessing to MDI Ventures to look for growth gaps that can be accelerated further. Companies cannot rely solely on Telkom and need support from other parties.

However, the focus has not changed from the beginning, namely looking for potential startups that can be invited to collaborate with the Telkom Group. This is in line with efforts to support Telkom's transformation to become more than just a telecommunications company.

"Telkom in the future will not only be telco companies. So we will stay go beyond telcos. Our task remains the same, find potential startups who can help Telkom for the future, if there is a good one, there will be collaboration," added Aldi Adrian, GM of MDI Ventures Investment.

The freedom to choose startup segmentation is an advantage for MDI Ventures compared to other CVCs, especially those formed by banks due to regulatory limitations.

"We are more agile because we can enter all business segments, so value added which we provide more than CVC in general."

Although still closing the next investment plans, Kenneth ensured that there are several investments that are ready to be announced towards the end of 2019. One of them is an investment for a fintech startup founded by a former employee of a unicorn.