Kudo’s untold story: how it got invested by East Ventures to enable Indonesia’s unbanked

This article is part of a series by East Ventures (a Tech in Asia investor) revealing the behind-the-scenes stories of how it invested in Southeast Asia’s leading startups. Republished with permission.

Kudo is an Indonesia-based tech company founded by local entrepreneurs Albert Lucius and Agung Nugroho in July 2014. The company wanted to allow anyone to participate in the local ecommerce scene, regardless of issues surrounding financial inclusion or internet access in the country.

At that time, the nation’s unbanked population accounted for approximately 64% of all locals, while overall internet penetration sat at roughly 20%. Ecommerce represented only less than 1% of all retail transactions in the country.

The Kudo team

From 2004 to 2009, Kudo CEO Lucius attended the University of Illinois at Urbana-Champaign, where he received his bachelor’s and master’s degrees in computer science. After earning his MBA from London Business School and UC Berkeley’s Haas School of Business, Lucius went on to become an analyst at Goldman Sachs, a product design engineer at Apple, and a consultant at Boston Consulting Group (BCG) before co-founding Kudo.

On the other hand, Kudo COO Nugroho had experience in management consulting and a track record in the telecommunication, infrastructure, and public sectors. He held multiple associate and consulting roles at BCG between 2008 and 2011. He attended London Business School before becoming an MBA candidate at Haas School of Business.

Willson Cuaca, co-founder of East Ventures, first met Lucius and Nugroho at a gathering of the Indonesian Professional Association (IPA) in Silicon Valley. The event was hosted in the cozy Bangkok Bay Thai Cuisine restaurant in Redwood City. Indonesian professionals in the South Bay area assembled to get a glimpse of the startup story back home. Lucius and Nugroho patiently waited until the event finished to talk about their startup with Cuaca privately.

IPA meeting with Indonesians in the San Francisco Bay Area

As the restaurant was about to close, the trio moved to a dark cafe across the street where Lucius and Nugroho showed the UI prototype using a tablet. The product instantly caught Cuaca’s attention as it seemed a very suitable product to serve ecommerce to the population outside of Jakarta, which was growing rapidly at that time.

He quickly threw an offer. The three shook hands in the dark while the cafe was about to shut its doors. Lucius and Nugroho said that they took the money despite meeting Cuaca for the first time in under six hours. “At the end, it’s about trust. I trust Willson,” Lucius says. “You just need five minutes to determine if the person is trustworthy. Sometimes, it just clicks.”

Nugroho adds: “We know Willson before from his track record, but never met him. We knew he is a believer in people.”

The term sheet was sent to both co-founders the same night, while Cuaca traveled back to San Francisco to catch a morning flight to Singapore. The deal was finalized the following week and Kudo set up shop in Jakarta.

“Finally, someone really understands the Indonesian opportunity of offline consumers, and combining that with tech is just powerful,” Nugroho says.

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