How valuable is VC money for Indonesia’s profitable bootstrapped startups?

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Hello reader,

Life is all about weighing your options. Should I have a burger for lunch or chicken rice? Should my partner and I buy an existing apartment on the resale market or wait for a new property that’s under development?

This mental balancing act behind the decision-making process applies to startups as well. Founders often spend a lot of time looking at the different options available to them, whether it’s considering what direction to take the company in or how they should finance their growth.

But as investors turn their attention to firms with sustainable business models, these companies also have to consider if a VC investment could give them the extra push they need to get even bigger.

Today we look at:

• The value of VC money for profitable startups in Indonesia
• A startup that’s delivering advertising to kids safely
• Other newsy highlights such as Sea’s widening losses and Adam Neumann’s latest venture

Premium summary

It ain’t always about the money, honey

Image credit: Timmy Loen

As profitability and sustainability become buzzwords for VC firms given the current global economic downturn, it’s no surprise that investors are looking to companies with proven and profitable business models. Indonesia is home to a fair number of bootstrapped firms that fit the bill, but they may not be so keen on taking VC money.

• Options aplenty: Startups with positive cash flow have lots of options when it comes to getting money. They can get loans that are non-dilutive or tap into profit-sharing investment schemes, among others, instead of giving up equity for VC funding.
• E is for equity: For many founders, equity is important to them. Some want to maintain greater control over their companies, while others feel that the cash burn and valuation playbook that is synonymous with the venture capital model don’t make sense for their businesses.
• The question of growth: But VC money could open new opportunities for these businesses to grow bigger and faster. Bootstrapped companies with solid fundamentals can leverage VC funding and value-add to accelerate growth at levels that could not be achieved by mere cash flow alone. But it’s up to individual founders to see if that’s something they want for their startups.

Read more: To take VC money or not: Indonesia’s profitable bootstrapped startups at a crossroads

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