OJK Issues New Regulations, 8 Startups Prepare for IPO

The Financial Services Authority (OJK) has finally issued a regulation on the classification of shares with multiple voting shares (MVS) for technology-based issuers. Meanwhile, currently, there are about eight startups that are preparing to list their initial shares, aka IPO.

Secretary-General of the Association for Venture Capital for Indonesian Startups(Amvesindo) Eddi Danusaputro assesses that startup founders will respond positively to this regulation.

“There should be an increase in the number of startups considering an IPO and this will be done domestically,” he said, Wednesday (12/8).

The study in the form of a whitepaper entitled The Billion Dollar Moment: A Paradigm Shift for Indonesian IPO’s released by Mandiri Capital Indonesia (MCI), Mandiri Sekuritas(Mansek), and Mandiri Institute revealed that the new regulation from OJK will make local exchanges more friendly for companies. technology such as startups.

Optimistic That MVS Rules Will Attract Unicorn Interest for Domestic IPO

The MVS rules allow startups listed on the IDX to issue multiple voting shares allowing the founders to retain majority voting rights. “In fact, this can happen if the founder owns less stock than the public,” the study said.

Edward Ismawan Chamdani, the Co-Founder and Managing Partner of Gayo Capital agreed that the MVS regulation would attract IPO unicorns in the domestic exchange.

“I agree and this regulation is indeed needed,” he said, mid last month (17/11). Because, the direction and decisions of technology companies that still depend on the vision, mission, and leadership of the founders and co-founders, are important for the founders to keep.

The provisions in the new rules are also considered to have the potential to attract more technology companies to list shares on the stock exchange. With jumbo valuations, unicorn and decacorn IPOs will increase the market capitalization value of the IDX.

Reza Priyambada, the Capital Market Analyst of the Indonesian Securities Analysts Association, also assessed that the MVS regulation could increase the number of issuers so as to boost market capitalization. 

What’s more, the Exchange classifies technology stocks in independent sectoral indexes. He also assessed that the authorities need to think about regulations regarding the ownership of capital. 

Because, startups are companies that are full of capital. “That must be regulated, who are the parties who are allowed to have a startup public company,” said Reza.

Eight Indonesian Startups Prepare for IPO

In Indonesia, there is one unicorn or startup with a valuation of over US$ 1 billion which has an IPO on the Indonesia Stock Exchange (IDX), namely Bukalapak in August (6/8). There are eight other startups that are planning to IPO, namely:

1. Combined Gojek and Tokopedia, GoTo

GoTo is preparing to IPO on two exchanges, namely the US and the IDX. Previously, GoToCEO Andre Soelistyo targeted the initial share listing on the IDX to take place before the end of 2021.

The business group resulting from the fusion of technology company Gojek and e-commerce Tokopedia then plans to list its shares on the US stock exchange with a potential valuation of around US$ 40 billion.

However, based on three sources quoted by Reuters, the postponement of the IPO plan occurred in line with the revision of OJK rules regarding share listing. 

2. Kredivo

Kredivo is considering IPO plans on two exchanges. The initial stage, this financial technology (fintech lending) company will become a public company on the United States (US) exchange, Nasdaq early next year.

“Considering the need for capital (capital), we chose a deep stock exchange on the Nasdaq. We are also considering listing in Indonesia and that does not rule out the possibility,” said FinAccel Co-Founder and CEO Akshay Garg in a virtual press conference, in August (3/8).

3. Tiket.com

The digital-based travel service (OTA) startup, Tiket.com, is reportedly planning an IPO next year. Tiket.com CEO George Hendrata said that the company reflected on the many tourism startups that benefited after the IPO. Apart from that, there are also Tanihub Group, Traveloka, Blibli, Warung Pintar, and OnlinePajak.