People often perceive digital signatures to be only happening in the developed world. DocuSign, a US company that manages electronic signatures and documents, went public in 2018, with a current market capitalization of more than US$8 billion.
However, many outside Indonesia did not know that Indonesia, the fourth most populous country in the world, recognized electronic signatures more than 10 years ago.
The Electronic Information and Transaction Law was passed in 2008, giving the legal basis of electronic signatures, useful for an archipelago of 17000+ islands with very challenging logistics to reach to everyone. The government also recognizes that digital services and fintech are the way to give everyone access to the modern world.
However, with the infrastructure just maturing, digital signature and digital identity are still a relatively new industry. PrivyID was founded in 2016 to just tap into that opportunity.
As one of the few companies who have been registered as Certificate Authority (CA) in issuing digital certificates by Indonesia’s Ministry of Communication and Information Technology (KEMKOMINFO), PrivyID received pre-Series A funding led by Mandiri Capital and MDI Ventures in 2017. They also received public endorsement from Indonesia’s government officials.
Mandiri Capital is the VC arm of the biggest state-owned bank of Indonesia, while MDI is the corporate VC of Telkom Indonesia – the country’s biggest telco. Other investors include Gunung Sewu and Mahanusa.
PrivyID also established direct connections to the government database of Directorate General of Population and Civil Registration, Ministry of Homeland Affairs of Indonesia, allowing a fast and secure electronic verification of the user’s identity before any document can be signed digitally.
For the founder of PrivyID, Marshall Pribadi, one of the proudest achievements is to reduce the registration time of Mandiri Sekuritas customers from 7 days to 2 hours. It is believed that Mandiri Sekuritas customer base grew by 30% because of this reduction of hassle and improvement of efficiency.
So it came as no surprise that many leading companies have become PrivyID customers:
Attract, train and retain good talent
Unlike many other startups in Indonesia which are consumer driven, PrivyID’s business model is heavily tech and B2B. Marshall shares that the need to hire and train more professional experts across multiple functions is imperative and pressing.
While many startups have set up their tech team in the capital Jakarta, the challenge is that bigger, better-funded companies often poach good talent. PrivyID has set up an R&D Centre in the city of Yogyakarta, which boasts a number of good universities, committed talent base, affordable living costs, and a very good vibe.
Coincidentally, HalalNode, one of the ventures of Momentum Works, also keeps a tech team in Yogyakarta.
To attract and retain good talent, PrivyID has designed a number of programmes to improve skills and sense of belonging. Aside from the common “best employee award” etc., PrivyID also instituted a “CEO Shadow” programme where two employees will join the CEO to oversee business activities even including VC pitches, media interviews, and government meetings.
Dealing with trust issues in Indonesia
Outside the company, Marshall says there are still some challenges in the market. For instance, the digital literacy ratio is still relatively low in Indonesia, manifested by the multiple hoaxes that people fell prey to. This in a way is a hindrance to PrivyID’s adoption among consumers, but interestingly became an impetus for organizations to adopt solutions like PrivyID.
Compared to major, many judges, notaries and police officers are still unfamiliar with digital signatures and thus prefer old ways of document evidence.
These are all the issues the PrivyID is trying to resolve, and Marshall seems to be very confident about resolving them.
Marshall and his team will be present at MWC Shanghai on 26-28 June as part of the Momentum Works delegation. Marshall will also be a key speaker at the Momentum Works China – Indonesia Fintech Summit, held in Shanghai on 26 June. Join us!
Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at [email protected]