Hi all! I was speaking in a conference called Slush in Singapore few weeks ago. The session theme was the next big things for Bukalapak and here is summary of what I shared there.
What is Bukalapak? People know us as leading e-commerce platform in Indonesia, but we are not e-commerce company, and you can see why later. We are technology company with mission to empower Indonesian economy especially SMEs.
How and why we started Bukalapak
First, let me share you why we started Bukalapak. It was eight years ago in 2010. Remember, during that time, startup ecosystem was pretty much nonexistent in Indonesia. There were very few investors. There were very few tech conferences — if any. The term “startup” was even rarely mentioned. Usually people called startup as IT or digital company back then.
We decided to jumpstart because we believed in our country’s potential especially in digital economy. Zaky, Nugroho, and I happened to be college classmates who just graduated from Informatics engineering in ITB 1–2 years before that and we saw what happened with digital economy around the world — US, China, South America, and others. We thought that this is something that can be done in Indonesia. With very big and young population, this country is projected to grow very fast. The growth of digital economy in Indonesia is in fact the fastest in the region.
And so, we did start Bukalapak. We started with creating third party, open marketplace platform where merchants especially SMEs can sell. The term Bukalapak itself means “open your stall” — an open invitation for everyone. It was not easy, obviously. We only gathered few SMEs when we started. But we continued until we gathered 10,000 SMEs in 2011. Currently in 2018, we have 4 million merchants with over 50 million users.
We are currently the 7th biggest overall website in the country (based on Alexa), have more than 100 cities where our merchants form active communities, are supported by over 2,000 talents (of which around half or 1,000 are in tech), and process billions of dollars of transactions every year. Even now, we still continue to grow fast every month.
So, what is our next step? As mentioned, we are still growing the marketplace, but there are 2 (two) other interesting areas that I want to share.
Supporting financial inclusion initiative through fintech
The first area is, we want to support Indonesian government in providing financial inclusion for its people. Now probably you will think, “Oh it is just another fintech”. I understand the skepticism since today there are so many people developing payment, p2p lending, and so on. Yet, what makes us unique is the fact that we build the fintech on top of already working ecosystem and this makes it more natural to grow.
For example, we have some investment products such as mutual fund and online gold. We have the basic feature, i.e. as user you can pay/invest to get this mutual fund or gold. Yet, on top of that, we also provide feature for our merchants to automatically invest part of their sales in Bukalapak to gold. So, for example, if merchant is selling IDR 53,000, or, to make it simple, $5 and 30 cents, they can automatically set to receive $5 to their bank account and to save 30 cents into gold.
Therefore, it is essentially accumulating spare change into gold. Later when it reaches certain amount, merchant can physically redeem the gold. Using this method, in just few months, our merchants have invested over a million times.
Empowering Indonesian Micro Economy with Mitra Bukalapak
The second big thing that we are doing is we want to empower Indonesian micro economy through our mitra Bukalapak (mitra is Indonesian word for partner). Who are these partners?
These are warungs or traditional mom and pop stores. Majority of Indonesian retail is composed of these warungs as opposed to modern trade, hence there are a lot of warungs across the country. What are we doing with them? Essentially warung becomes our sales channel so that people who are not online savvy yet / people who do not know how to buy online can just go to these warungs and ask the warung owners to order for them. They later pay the warung usually in cash.
Warung will get commission, thus essentially, we help this warung to increase their sales with almost no capital or inventory risk needed. Currently we have 300,000 warungs and this makes us the largest warung network in the country.
I am going to close this with takeaways or action points. First, if you want to create business, start with strong why or big vision. This is because the bigger your vision is, the more you will be driven to solve your problem. Entrepreneurship is never easy and the failure rate is high. Therefore, it is easy to give up quickly if you do not have big vision.
Second, however, when you start, start small. You probably read many good examples from Silicon Valley, China, or even from our case, but do not always assume that solutions done by other people can immediately work in your case as well. Pair the good solution with your unique problem in your environment. Good solution answers actual problem.
You may ask, what is our why or vision then? We want to empower our country, Indonesia. We want to grow together with Indonesian economy especially SMEs, and we can only be successful if more of these SMEs are successful.