Charting this little-known Indonesian startup’s rapid rise

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Hello reader,

It is not uncommon to find ludicrous company valuations in both public and private markets. Usually, these absurd figures spell either trouble or opportunity. If the valuation is shockingly low, you buy. If it’s jaw-droppingly high, you don’t touch it with a ten-foot pole. There’s your 101 on investing.

Investors in Cermati likely leaned closer to the former, pushing the little-known Indonesian startup’s valuation 10x higher to US$344 million following its series D round in the second quarter last year.

The generous valuation bump does make some sense. For starters, since 2015, Cermati has seamlessly grown from a fintech aggregator to an all-around financial group with consumer lending and insurance services as well as a banking-as-a-service operation.

Further bolstering investor optimism, the fintech firm logged a nearly 2x year-on-year growth in the book value of its “as-a-service” model last year, while both its insurance and consumer-financing businesses went a step further and more than doubled their book value over the same period.

In today’s featured piece, my colleague, Budi, dissects how Cermati’s as-a-service model glues its core financial products together more efficiently and how embedded finance offerings across banking, pay-later services, and insurance have propelled the company into the spotlight.

The premium story also explores the likely challenges the startup will face as it further digs its roots into the insurtech and buy now, pay later sectors in Indonesia.

Today we look at:

• How Cermati’s valuation grew almost 10x in under four years
• Why analysts back Alibaba to grow in 2023
• Other newsy highlights such as Shein setting a massive US$60 billion annual revenue target

— Shravanth

P.S.: If you’re an entrepreneur looking for funding, fill out this form to get your company featured on our list of fundraising startups.

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Image credit: Timmy Loen

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