S3E3 | Lessons from Indonesia’s Startup Crash and the Road to a Stronger Future

In this episode of Hard Truths by Vertex, Gary Khoeng, partner at Vertex Ventures Southeast Asia and India, joins host Rahul Thayyalamkandy to explore the Indonesian startup ecosystem. They discuss the recent decline in capital flows, attributing it to global macroeconomic conditions, underperforming IPOs, and election uncertainties. Gary also addresses corporate governance issues and fraudulent activities, highlighting the need for investors to take a more active role. The conversation also covers the ongoing tech talent shortage and potential for AI to bridge the gap. Despite challenges, Gary expresses cautious optimism, pointing to Indonesia's strengths in natural resources and its large consumer base, which present opportunities for fintech, logistics, and consumer-focused startups.IN THIS EPISODE(00:00) The Hidden Startup Boom: What’s Happening Behind the Scenes in Indonesia?(01:00) Capital Exodus or Course Correction? The Truth About Indonesia’s Investment Shift(04:55) Can Indonesian Startups Escape the Governance Trap? Lessons from Recent Failures(07:16) Investors vs. Fraud: Are They Watching Closely Enough?(08:33) From Boom to Bust: Why Some Startups Collapse Overnight(10:32) Who’s Really in Charge? The Role of Governments, Investors & Founders in Fixing the System(11:38) Why More Founders Are Skipping the Startup Dream in Indonesia(13:55) Indonesia’s AI Gamble: Can Tech Talent Gaps Be Closed?(15:24) Is Uncertainty the Best Time to Invest? Finding Opportunities Amid Chaos(21:43) Can Indonesia Revive Its Industrial Legacy Through Exports & Manufacturing?(23:28) Can Indonesia’s Sovereign Fund Replicate Singapore’s Success Story?(25:31) The Valuation Trap: Are Indonesian Startups Focused on the Wrong Metrics?(28:48) The Next Big Spark: What Could Ignite Indonesia’s Startup Renaissance?Gary KhoengGary Khoeng joined Vertex Ventures Southeast Asia & India in 2017. He focuses primarily on covering Indonesia’s burgeoning startup ecosystem.Prior to joining Vertex, Gary was actively investing in early-stage opportunities entrepreneurs at an Indonesian fund across various sectors including e-Commerce, Fintech, Media and SaaS. Prior to that, Gary spent several years at Citigroup in New York, Singapore and Hong Kong. He also joined the Boston Consulting Group in Jakarta, covering the FMCG and Financial Services sector.https://www.linkedin.com/in/garykhoeng/Rahul ThayyalamkandyDirector of Comms & Community, Vertex Ventures SEA & IndiaRahul Thayyalamkandy joined the SEA/India team as the Director of Communication & Community in 2024 and is based in Singapore.Before joining Vertex, Rahul served as a Product Manager at BLOCK71, an incubator and joint venture of NUS Enterprise and Singtel Innov8, where he developed scalable services for portfolio startups and designed mentorship programs. He also gained experience as a Summer Associate at Cocoon Capital, working with the Managing Partner on investment deals.https://www.linkedin.com/in/rahulthayyalamkandy/Vertex Ventures Southeast Asia & India is a pioneer in investing in tech start-ups in this region and has helped to build a number of unicorns. In this podcast, we seek to share and uncover the Hard Truth - raw, unfiltered insights and venture capital knowledge from across Southeast Asia and India. Tune in to learn from leading founders, innovators, venture capitalists, and industry experts in the region and gain industry insights from those in the know.If you like what you hear, please follow or subscribe to the show so you don’t miss out on any of our upcoming discussions.—Follow us to get notified whenever new episodes are shared.—For more information, please visit: https://www.vertexventures.sg