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‘Sea turtles’ import culture of innovation to Indonesia’s tech startup ecosystem

Written by Khamila Mulia Published on     6 mins read

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Just like in China, the ‘sea turtles’ of Indonesia who return after lengthy stays abroad play significant roles in building new ventures in Southeast Asia.

While studying electrical engineering and computer science at the University of California, Berkeley, Surya Halim actively participated in various extracurricular activities. He was the San Francisco Bay Area chairman of the Indonesian student association in the United States (Permias). The organization often worked with the Indonesian consulate to organize events featuring speakers from Indonesia’s top tech companies.

“Because Silicon Valley is a benchmark for Indonesian tech companies, many representatives of startups like Tokopedia and Bukalapak went there and held seminars for students in San Francisco. They’d encourage the diaspora to return home after completing their studies, so they can work in and develop Indonesia’s tech scene. Many venture capital firms also brought their portfolio companies to visit tech enterprises there,” said Surya Halim to KrASIA.

When he was still a student, Halim met Raymond Christopher and Theo Budiyanto, who also studied at the same university. After graduating, Christopher and Budiyanto worked at tech companies in Silicon Valley before deciding to return home with Halim to set up a business in data management. The three of them founded Delman in 2018, with Halim serving as CEO, while Christopher and Budiyanto act as chief data officer and CTO, respectively.

Halim said that having studied and lived in one of the world’s biggest tech hubs helped Delman’s co-founders build their own business. “We don’t want to be hypocritical by saying that educational background doesn’t matter. What helps is not being educated abroad actually, it was the fact that we graduated from one of the top universities globally. This gives us credibility when we pitch our business in front of potential investors or clients,” Halim said.

These entrepreneurs’ time in California showed them the tech industry’s best and worst practices in running a startup and steeped them in a culture of innovation. Their collective CV includes time at top companies like Google and Splunk, which gives them a competitive advantage at home.

“Education and work experience in Silicon Valley help us to project the future trend of the tech industry. That is why we chose to build a data company in Indonesia, which was not so common back then,” Halim said.

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‘Sea turtles’ lay foundations

In China, people who return to the country after years of studying and working overseas are called “sea turtles.” Just like in China, the sea turtles of Indonesia also play significant roles in building up their home country’s tech startup ecosystem by bringing with them advanced tech and entrepreneurship skills, as well as global connections and networks that may be useful later on.

Some of Indonesia’s tech pioneers, like Gojek’s Nadiem Makarim and Traveloka’s Ferry Unardi, were educated in the United States. In a 2019 interview with former minister of trade Gita Wirjawan, Makarim was asked whether he’d be able to build Gojek without attending Brown University and Harvard Business School. He said while the skills required to build the decacorn were not necessarily cultivated during his studies, these institutions did give him credibility when he met with potential investors during the company’s early phases—he agreed that branding matters. Also, Makarim said that being around students from all over the world who had plans to build their projects made him want to do the same. 

“The first five years of any early ecosystem, including tech, is usually very influenced by these sea turtles that grew up in the market but study abroad, get global exposure, and learn about business strategy, scaling techniques, and culture in places like Silicon Valley. We saw that happen in Taiwan, Korea, and Israel in the 1980s. And I saw that again in China in the early 2000s as companies like Baidu and Sohu are founded by sea turtles,” said Eddy Chan, founding partner of Intudo Ventures, an Indonesia-exclusive early-stage VC firm. Chan spends eight months a year in Silicon Valley, where he does community engagement with members of the Indonesian diaspora studying in the US.

“In Indonesia, I’d say 92% of the unicorns and tech companies with a valuation of over USD 100 million have co-founders or top leaders that studied outside of Indonesia at some point in time. These folks do have a pretty good influence on the ecosystem, and if you pair them correctly with the right in-country talent that really understands the market dynamics, it helps to build a great company and further advance the ecosystem,” Chan continued.

Digital startups operate differently than most small and medium enterprises (SMEs) or traditional companies. Startups incorporate the latest technology to enhance their functionality, with the ultimate goal of creating disruption in the market. With a booming digital economy and more than 1,300 digital startups in the country, Indonesia now needs a growing number of proficient tech professionals—and there may not be enough of them being trained at home.

For Indonesia’s tech scene to continue to evolve, there is a need to ensure Indonesian students, professionals, and scholars who go abroad do eventually return home, apply their skills, as well as transfer their knowledge to peers. But the allure of working in the US, as opposed to starting a new operation from scratch in Indonesia, means some Indonesians are hesitant to immediately return home.

Read this: [Tuning In] Normalizing STEM education for women | Q&A with ex-Gojeker Crystal Widjaja

On various occasions, the Indonesian government has encouraged the diaspora to return home to develop science and technology.

The government plans to provide incentives for members of the diaspora, such as placement in a number of institutions to take over from foreign experts. It also provides scholarships that require recipients to return home after completing their education abroad.

The same goes for private ventures: Intudo has a program called the Pulkam S.E.A. Turtle Fellowship, which gives returnees guidance and support for their entrepreneurial aspirations, or career placement assistance at companies within Intudo’s portfolio.

Nonetheless, starting a business in a tech-oriented environment that still has growing pains is no simple feat. Sea turtles often have inner struggles after they land in Indonesia. For Halim, introducing his startup’s product to potential clients, which include traditional companies that are typically resistant to change, can be challenging.

“Since our products are very technical in nature, making adjustments based on the conditions and specifications of local companies is crucial. Otherwise, the product cannot be used by local clients,” he said.

There was another major obstacle. Even though Halim has business and personal connections in the US that could aid his startup, he lacked a local network in Indonesia. “The landscape and business opportunities in Indonesia are a bit different from those in America. In America, particularly Silicon Valley, we need to always update and sharpen hard skills, like coding or designing, in order to compete in the market. The level of hard skills needed in Indonesia is not as complex as in Silicon Valley, but we need to adjust some soft skills like communication or leadership strategy to suit local culture and customs,” Halim said.

Read this: Hacktiv8 is closing the tech talent gap in Indonesia

Local institutions are catching up

For now, many sea turtles occupy top leadership positions in Indonesian startups, but Halim doesn’t consider the geography of a candidate’s educational background as a key factor when hiring talent. This is especially true for tech-focused roles like software developers or frontend engineers, where candidates need to pass a technical test to get a second interview. Those who fail the test will not be accepted regardless of the origin of their diploma.

A successful tech startup ultimately incubates homegrown talent, according to Chan, and Indonesia has already demonstrated its ability to develop unicorn-caliber founders. Sea turtles certainly need locally trained talent who have a deep understanding of market trends, opportunities, and the industry’s ins and outs. In parallel with its fellowship program, Intudo also works closely with universities in Indonesia to source potential founders and staff for the firm’s portfolio companies, Chan said.

Indonesia has several universities that are known to breed technopreneurs, such as Bandung Institute of Technology and the University of Indonesia. To close the talent gap, a few startups like Hacktiv8 and Glints offer non-degree IT courses that match the tech industry’s requirements, while unicorns like Gojek and Tokopedia run training programs named GoAcademy and Tokopedia Academy to develop new technical personnel. Moreover, tech companies often collaborate with local universities to support students who have an interest in tech and business—and who may someday disrupt the industry.

“Education background and programs like mentorship or accelerators can help founders start a business, but at the end of the day, what matters most is making products that solve our customers’ problems,” said Halim.

“At the end of the day, there are three key pillars that early-stage founders need to have. First, you have to be very strong in signing deals, which means being good at communication and distribution. Secondly, you need to be strong in recruitment and convincing people to join your mission. And finally, you need to have good relationship capital. These apply to all founders regardless of their background,” Chan said.

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