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Modernizing trucking in Indonesia: Tiger Fang of Kargo | The Indo Tekno Podcast

Indonesia’s trucking sector is profoundly fragmented: 75% have 20 trucks or less and a massive amount of the USD 38 billion annual trucking spend disappears into a labyrinth of middlemen.

The Indo Tekno podcast is hosted by Alan Hellawell, who is the founder of Gizmo Advisors and a venture partner at Alpha JWC Ventures. In this episode, Alan talks to Tiger Fang, co-founder and CEO of Kargo Technologies.

Trucking in Indonesia is clearly ripe for disintermediation: Annual logistics spend represents a massive 26% of GDP. Moreover, the sector is profoundly fragmented: 75% of trucking companies have 20 trucks or less, and a massive amount of the USD 38 billion in annual trucking spend disappears into a labyrinth of middlemen.

​Having started his career in investment banking, Fang early on developed an appreciation of the awesome power of financial and technological leverage in driving profound change into operationally intense industries such as logistics and e-commerce.

Fang is a veteran of massive platform launches into new markets. For instance, he built out Uber in Western China. At one point, the provincial capital Chengdu was in fact Uber’s busiest urban market globally. Fang also helped launch Rocket and Lazada operations into Thailand and Vietnam.

​Founded less than two years ago, Kargo has already deployed its “marketplace model,” which aggregates supply and demand between transporters and shippers, initially across the dominant markets of Sumatra, Java, and Bali (80% of Indonesia’s GDP) and beyond. Fang believes that Kargo has one of the most robust R&D teams of the Indonesian tech scene, an achievement that he credits to co-founder and CTO Yodi Aditya. The two leaders view a robust culture as critical to ensuring healthy growth.

Read this: This is how Kargo Technologies will spend USD 31 million: Startup Stories

​While truckers are unlikely to become first adopters of cutting-edge technology, Fang has been pleased with the adoption of Kargo’s platform in Indonesia, which he attributes primarily to its effectiveness in reducing the truckers’ downtime. It is improving earnings power and—most importantly—easing working capital challenges for a sector that usually gets paid only 1–3 months after the delivery of goods.

​While COVID-19 has led to significant disruptions to the sector, Kargo’s use of big data has been critical in creating greater market efficiency and liquidity on the platform. Fang is particularly excited about the steady stream of “financing-as-a-service” offerings that Kargo plans to unveil steadily over the coming months.

​Listen to the full podcast here.

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