Uber is a cautionary tale – and inspiration – for Southeast Asia

Dear readers,

I spent a tiring but fulfilling week in Jakarta at East Ventures’ 10th-anniversary event as well as our flagship conference, moderating panel discussions and catching up with friends.

The mood was upbeat. People are optimistic about the future of Indonesian tech. The country had zero unicorns a few years ago, but it has five today, and folks like William Tanuwijaya, the founder of Tokopedia, are hailed as heroes.

Put this in contrast with the US, where Big Tech is now seen as villainous. I was reminded of this after reading Super Pumped: The Battle for Uber, an excellent book chronicling the rise and fall of Uber’s ex-CEO, Travis Kalanick.

Travis Kalanick speaks at TED2016 – Dream, February 15-19, 2016. Photo: Bret Hartman / TED.

It contains many lessons for Southeast Asia’s tech companies. We’ve forgotten how revolutionary Uber was when it first started: It leveraged the rise of smartphones to popularize ride-hailing and changed the transportation landscape by making rides seamless and giving the complacent taxi industry a kick in the butt.

While its aggressive mentality may have propelled it ahead initially, it failed to adapt. As the company grew, it was derailed by a mix of ethical compromises, a lack of board oversight, a nonexistent corporate structure, as well as rampant spending. Kalanick’s company was so sought after by investors that he could dictate onerous terms and withhold information from shareholders without complaints.

But after the startup blew up, Kalanick finally admitted to his employees that he was a great founder who failed as a CEO.

Uber serves as a cautionary tale for Southeast Asia’s internet economy, which looks to be in a golden age and could see its size triple in five years. Many unicorns will be born, and valuations could get frothy.

While we’ve certainly seen some excess in this region, it hasn’t hit the heights of the US and China yet. Founders and investors here will do well to absorb the lessons from those markets and clean house before the shit hits the fan.

The public may have turned against Big Tech in the US, but that doesn’t have to be the case in Southeast Asia.

As always, check out our premium pieces from the past week (do subscribe if you want to read them):

Fintech

• Southeast Asia’s e-payments battle is reaching fever pitch. Here are the players
• What’s next for Stripe in Southeast Asia
• After P2P lending, an alternative form of credit financing is taking shape
• Meet the 20 top-funded fintech companies in India

Big Tech

• Beyond Lazada and Shopee: Southeast Asia’s major ecommerce players in each market
• The positive impact of Adam Neumann 😊

Up-and-comers

• Rising startups on Tech In Asia: super app for SMEs, hyperlocal logistics, and more
• A startup claims to help companies reduce incorporation and governance headaches

Stuff you may have missed

• Reebonz has been facing cashflow problems and rising debt. It’s now plotting a comeback.
• Grab: Indonesia’s fifth unicorn?

Cheers,

Terence
Chief editor