Investors, venture capitalists and regional start-ups gathered on the Indonesian island of Bali to discuss the future of tech in the world’s fourth most populous and the broader region, while U.S. Vice President Mike Pence visited Jakarta, Indonesia, this week to discuss bilateral trade issues as part of his 10-day trip to Asia.
“What’s happening politically with the H-1B visas being reviewed and the crazy stories you’re hearing, people have to hedge their situation and see where the high growth is happening,” Ahmed Shabana, managing partner of Parkpine Capital, a Silicon Valley firm, said while talking to the media. “It might be risky to get talent in the U.S. if things escalate.”
While connecting investors with ideas, aiming to find scalable technologies in high growth markets is the first of its kind, the Global Ventures Summit in Bali. Presentations from VCs and the likes of tech giants from Google to IBM were included in the event. Taking part in the summit was $5 billion worth of investor funds, Shabana estimated.
“We’re viewing Southeast Asia and Indonesia as the new China and it’s very obvious that something great is going to happen,” said Shabana. In two to three years from now, acquiring a customer in Indonesia will be costlier and more difficult and that is why now is the time to get in he thinks.
a ripple of anxiety here is being caused by political uncertainty in both the U.S. and Indonesia. Many trade partners throughout the region have been worried as president Donald Trump has repeatedly said he will seek trade arrangements that greater benefit his country.
“Donald Trump presents the danger of U.S. protectionism being misinterpreted to an economy here,” said Wayne Forrest, president of the American Indonesian Chamber of Commerce. “A lot of questions I’ve had with government officials here are about Indonesia being on the list of countries being watched.”
While not being exciting, Indonesia’s potential for investment and scalable growth was described as positive by Forrest. Forrest said he fears infrastructure in the region still lags behind while the population and rising middle class is appealing for U.S. companies.
But the region as a whole is intriguing for many U.S.-based VCs at the summit.
According to a report by Temasek and Google released last year, adding close to 4 million new internet users every month, South East Asia is the fastest growing internet region in the world. According to the report, by 2025, the internet economy is expected to be a $200 billion opportunity.
The first trip to the region for investors like Andrew Romans, general partner at Rubicon Venture Capital and author of “The Entrepreneurial Bible to Venture Capital,” was prompted by that statistic.
“I think that the percentage of global GDP that the U.S. represents is going to keep going down and the percentage of GDP from South Asian countries is going to continue to grow,” Romans said. “What’s our strategy to get there?”
(Adapted from CNBC)