Sharing Session With Traveloka’s CTO and Co-founder
Conversations about culture, Indonesian politics, and strategy
Thanksgiving is a unique phenomenon here in the US. Schools and offices close for up to one week in observation of the holiday. I did not travel anywhere this time. I had hectic last few weeks with job and other stuff.
However, I was glad enough to have some time to catch up with friends. I also took some ‘me’ time.
It was delightful.
On the Friday night after Thanksgiving, less than 20 twenty-something recent grads gathered in a meeting room, somewhere in Palo Alto.
We had an intimate discussion with Derianto Kusuma.
He is the Chief Technology Officer (CTO) and co-founder of Traveloka, a leading online travel-related services startup in Indonesia.
Derianto is smart, humble, and interesting. My good friend said that Derianto thinks like an economist — he considers the prices, supply, demand, and its relationships and apply those to his wide-ranging domains. At the same time, he is a true engineer. He believes in a technological endeavor that would last indefinitely, despite the market trends.
Anyway, I thought that the insights from the meetup are worth sharing:
1. Building A Top Engineering Team
For the scale that they do, Traveloka has one of the best engineering teams in Indonesia. As of now, there around 200+ engineers who work under Derianto’s guidance. But, in the early days, it was only him and his group of friends who built the product.
Derianto purposely tapped into the best practices of these senior engineering hires, and tried to replicate them in order to make Traveloka a world class company.
As Traveloka gained traction, they started hiring the top senior engineering positions from companies such as Apple, Flipkart, Google, and the like. Derianto purposely tapped into the best practices of these senior engineering hires and tried to replicate them in order to make Traveloka a world-class company. If you notice, Traveloka instills a degree of technical rigor in their business, marketing, and sales teams.
Derianto also shared some insights about the software engineering talents in Indonesia. He said that there is an upward pressure on salary, due to the demand and competition for startups to hire the ‘most competent’ talents. They have also started to include ‘stock grant’ (a modification of stock option system) into the salary package.
To give you an idea, there may be 300–400 new graduates every year from the top Indonesian universities. However, not all want to work in the tech industry , thus the number of ‘qualified talents’ is actually smaller.
2. Understanding the Political Landscape
We digressed a little bit from tech. But, this was the most interesting part.
We talked about the current political landscape in Indonesia, and the nature of the public and private sector. We discussed that in general the private sector may have an expertise in execution, however the public sector may have a ‘better’ network and leadership to reach everyone in Indonesia.
How can we best solve this problem?
For example, in the education sector, especially in smaller cities, we see that children feel reluctant to go to schools or universities. They may actually earn money by doing casual labor and therefore have less motivation to achieve a formal education. When they are in school, they may still suffer from lack of inspiration because the teachers are not that ‘competent’. This issue could be caused by the low wages that teachers get, for example. In turn, their teaching quality affects the students, and so on. It’s a vicious cycle similar to the cycle of poverty.
How can we best solve this problem?
The private sector may help in distributing educational materials, but would this solve the root cause?
In terms of policymaking, we also discussed how the legislative body has a ‘monopoly’ on power. There is already a high risk for corruption (outright or clandestine alike) in Indonesia. Given that, the executive and the judiciary have to be able to keep the legislature’s actions accountable. Still, this is not that simple due to the complex political bargains that happen under the table, invisible to voters and most people.
To quote on a participant’s comment, “Could we then democratize our ‘democracy’?” Could we use the Internet and technology to make sure that the voters’ hopes are fulfilled and delivered?
Okay. Enough about politics. We could talk all night.
(But, seriously, hit me up if you share the same vision to build the country’s financial access and education system)
3. Product & Strategy Excellence
Derianto mentioned that it was his “rational focus” in identifying gaps that led him to start Traveloka. I believe that his high-calibre team helped him to do the execution, extremely well.
He said that the consumers’ need in emerging markets are quite simple. If you are good enough in your execution, the market will respond to you.
And, regardless, Derianto plans to build features that would make the consumer’s demand to be more price inelastic.
In regards to the Chinese investments in Indonesia, there is a risk that the big ones would ‘kill’ all the smaller startups easily, either through price wars or mergers and acquisitions. We can already witness this in certain verticals such as e-commerce and ride-hailing. Apparently, the marketing and acquisition spend for the biggest ride-hailing rivals in Southeast Asia can easily reach up to $1B per year.
There are no price wars in the online travel industry (yet?). And, regardless, Derianto plans to build features that would make the consumer’s demand to be more price inelastic.
My Personal Takeaway
I enjoyed the talk as it was different from most of the talks I have attended in the Bay Area. It was great to have an intimate sharing session with one of the most prominent players in the Indonesian tech landscape.
It was a two-way street, as we also shared our passion and thoughts about things that matter. Thank you for your time, Derianto. My best wishes for the great work you and the team do at Traveloka.
Special thanks to Mellisa Luis and Samuel Halim for organizing the event.