MDI Ventures, the corporate venturing arm of telecommunications firm Telkom Indonesia, plans to invest $100m in the next four years, venture partner Herdi Sularko told DealStreetAsia yesterday.
MDI, which stands for Metra Digital Innovation, was launched in January this year and is based in Jakarta, with additional offices in Silicon Valley and Singapore. It provides funding for startups in addition to operational assistance for Telkom subsidiaries.
The unit will invest about $25m each year in both Indonesian and international startups, and is particularly targeting companies with products that can be integrated with Telkom’s. Sularko told DealStreetAsia that in practice that would often mean business-to-business (B2B) startups.
“B2C (business-to-consumer) companies normally have much higher costs than B2B,” he said. “They will most likely spend on marketing. Besides, Telkom has always been more of a “background” player, an enabler, rather than providing services directly to customers.”
MDI’s portfolio companies so far include aCommerce, Red Dot Payments, Ematic Solutions, monetisation software producer Geniee, programmatic advertising platform Adskom, events listing company Goers and Kata.ai, the personal services platform formerly known as YesBoss.
The unit typically invests in deals sized between $500,000 and $5m, and aims to maintain a minority stake in each portfolio company sized at no more than 20%.
However, from 2017 MDI will look to form partnerships with additional funds in order to grow its presence, having formed such a partnership with Telstra Ventures, the corporate venturing subsidiary of Australia-based telecom group Telstra, in August this year.
“We want to prove that we can be on the same level as Google Ventures and Intel Capital, that we can also attract private funds,” Suralko said.