Indonesia to see first local startup IPO next month

Indonesia Stock Exchange building. Photo credit: Everyone Sinks Starco.

Kioson, an online-to-offline ecommerce service, is on track to become the first Indonesian startup to raise money through initial public offering (IPO) at the Indonesia Stock Exchange.

It’s going to sell 150 million shares, equal to 23.1 percent of the company, at a price of just over US$0.02 per share.

Of the US$3.1 million to US$3.4 million Kioson targets to raise, it will use 76 percent to acquire another business, Narindo, the firm’s representatives said at its investor briefing preceding the IPO which is scheduled for October 3. The remaining funds will be used for operational costs.

Rural ecommerce

Kioson runs a network of small shops where you can buy things online and pay bills through agents. It’s meant for less tech-savvy people in rural areas who prefer to pay in cash through a person they trust.

The startup is similar to Kudo, which got acquired by ride-hailing firm Grab for a reported US$100 million.

“We chose to IPO because we want to show that startups don’t have to rely on venture capital,” said Jasin Halim, Kioson’s director, at the event.

Kioson’s team at today’s pre-IPO public expose and investor briefing.

Narindo, the company Kioson plans to acquire, is a payments company providing “modern retail” solutions, according to its website. It partners with mobile phone operators and ecommerce firms like Alibaba’s Lazada, Tokopedia, Blibli, and Indonesia’s two leading convenience store chains Indomaret and Alfamart are among its clients.

Kioson says it has 19,000 partner shops in 384 Indonesian cities. The number of partners is expected to grow to 30,000 in the coming year.

Its revenue for the period of April 2016 to April 2017 was US$1.9 million with a US$330,000 loss in the same year.

Halim says the company targets to be profitable in 2018. “The acquisition of Narindo will help our bottom line.”

The IPO is underwritten by Sinarmas Securities.