UMG Group launches venture capital facility in Indonesia

• A CVC offering funds for seed-stage funding
• Has invested in 11 local startups

MYANMAR-based corporate venture capital (CVC) providing seed stage funding, UMG Idealab has started its venture journey in Indonesia with 11 portfolios to date.

UMG Idealab is a subsidiary of UMG Myanmar, one of the largest companies in Myanmar with more than 5,000 employees and the largest producer and distributor of agricultural tractor equipment. Seeing the rapid growth in technology, the founder of UMG Myanmar, Kiwi Aliwarga initiated the creation of UMG Idealab.

The CVC has two lines of business, the first based in Myanmar, is an incubator that helps startups boost their business and the second is an Indonesian-based CVC that funds startups with seed funding, and has sister companies in Myanmar and Thailand.

UMG Idealab managing partner Achmad Syaefi told Digital News Asia that for 2019, the company is looking for startups in IoT, Big Data, Voice Recognition (VR), and Artificial Intelligent (AI). He aims to invest in 20 startups next year.

To date, UMG Idealab has funded 11 Indonesian startups in agri-tech, health-tech and edu-tech namely Ritx (MSMB) (Agri-tech app supported by IoT), Bahasakita (VR platform driven by AI), Botika (Chatbot driven by NPL), Frogs: Online Air Taxi (in development), Crowde (P2P lending platform for farmers), Aruna (integrated fishery commerce), Bukku (commerce for books), Prosehat (healthcare marketplace), Netis (human capital management platform), Total Agri Mart (e-commerce for comestibles), and Perawatku (on-demand nurse services).

UMG Idealab brands itself as an agnostic investor even though the business of startups in agriculture will bring more value to the company.

Syaefi said that all the investment deals involve equity participation. “Now, all funding comes from UMG Group but we are also open to any interested ‘Limited Partners’.

“The market size in Indonesia is undoubtedly high with the biggest digital population in Asean. And there is possibility for us to invest in startups coming in from countries across the region.”