Indonesia’s WIR rides metaverse to IPO success, but revenue stream raises questions

Earlier this year, an innovative local tech company went public on the Indonesia Stock Exchange (IDX), and its IPO was oversubscribed.

No, it wasn’t the super app GoTo.

Rather, it was homegrown metaverse builder WIR Group, which raised a relatively modest US$29 million in its IPO just a week before GoTo’s US$ 1.1 billion listing.

WIR Group co-founder and chairman Daniel Surya / Photo credit: WIR Group.

Understandably, WIR’s stock market debut was mostly overshadowed by the hype surrounding the IPO of Indonesia’s largest tech company. However, WIR’s post-IPO journey as a listed tech company has been much more successful than GoTo’s.

While GoTo saw its share price go on a free fall by 34% after its first month on the IDX, WIR’s share price climbed by over 350% after a month of being listed. On the close of July 20, GoTo’s shares were trading at 308 rupiah (slightly below its original selling price of 332 rupiah per share), while WIR’s share price stood at 560 rupiah (higher than the 222 rupiah in its IPO).

It should be pointed out, though, that WIR’s market capitalization and trading volume is meager compared to GoTo’s. WIR’s market cap on July 20 was pegged at 6.91 trillion rupiah (US$460 million) while GoTo’s was at 357 trillion rupiah (US$24 billion). Also, WIR’s 65-day average trading volume stands at 116 million, significantly lower than GoTo’s volume of 2.8 billion.

Prior to its IPO, WIR was already profitable for three years. Having strong fundamentals helped WIR get a solid start to its life as a public company, says co-founder and chairman Daniel Surya.

He adds that another factor was the timing of the WIR’s listing. It coincided with the early rise of the metaverse concept championed by Facebook, which prompted the social media titan to rebrand itself as Meta.

“When the momentum came and [Meta co-founder] Mark Zuckerberg called it Metaverse, we rode on the wave because we had it all prepared,” Surya says.

However, WIR still has a lot to prove with regard to its business model. It also has to contend with competition from metaverse makers like global tech giants Apple, Decentraland, and Nvidia as well as Meta itself, which will undoubtedly pose a massive challenge for the Jakarta-based company.

An O2O approach to the metaverse

The idea of building a metaverse must have been sexy enough to attract Indonesian investors, with excitement also drummed up by WIR partnering with a number of state-owned and private companies.

WIR is building Metaverse Indonesia, which is set to be introduced in November. The platform will be the “gateway that leads humans to various digital experiences,” the company says.

Concerns over the business model