Indonesian Startup Shakes Up The Muslim Fashion Industry

It’s one thing to be the founder of a successful startup, quite another to have two in one household.

Achmad Zaky and Diajeng Lestari are Indonesian couples whose respective businesses, Bukalapak and HijUp, are taking on the world of online sales.

Founded in 2010 by Zaky, Bukalapak, which means “open store” in Indonesian, is an eCommerce platform serving 2 million visitors a day. HijUp is an editorial and sales platform for Muslim fashion that Lestari started in 2011, and which now has more than 500,000 monthly visitors.

In Sydney on Oct. 29 for the startup conference SydStart, the pair spoke with Mashable Australia about what it’s like to be entrepreneurs in Indonesia and offered insights for foreign startups eyeing the increasingly tech-savvy nation.

The story of Bukalapak

When Zaky started Bukalapak at university, he couldn’t imagine it would grow into such a big business. “At the time, it was just a hobby,” he said. “We are now one of the largest [ecommerce sites] in Indonesia by traffic.”

He has big ambitions for the site, which operates similarly to eBay. “Every day, 50 million Indonesians check-in on Facebook. That’s huge potential,” he suggested. Of course, he’s comparing a sales platform to social media, but Zaky pointed to Chinese sales giant, Alibaba, as an example of a company that can reach those kinds of numbers.

“Alibaba is the same class compared to Weibo or even Facebook,” he said. ‘I believe an Indonesia player, and especially Bukalapak, will go in that direction.”

The story of HijUp

Also working in eCommerce, HijUp is an online platform for designers creating Muslim fashion. Zaky said he calls it the “ASOS of the Islamic world.”

Lestari explained she started the business because she didn’t have a lot of choices in a wardrobe when working. “It was frustrating to drive from one mall to another mall because the traffic in Jakarta is very bad,” she said. She talked to Zaky about her idea when he was already running Bukalapak, and he advised her to start something online.

The target audience for HijUp is both very specific and very large. “Our target market is me: A Muslim woman, modern, cosmopolitan,” Lestari said. She believes the western media projects only one image of Muslim women. “We’re wearing all black, wearing a burka … There is a market there for a Muslim woman who is quite modern, moderate, and open-minded.”

In Indonesia alone, there are more than 205 million Muslims, and 1.7 billion Muslims around the world. Given around half of those are women, the size of the potential audience for HijUp is significant.

The state of Indonesian startups

With a population of 255 million people, Indonesian startups have a healthy home market to work with, and one that is increasingly online.

According to Zaky, the growth rate of Internet users per month in Indonesia is immense. “In the next three years, I believe we will have like 150-170 million Internet users,” he said.

Indonesia’s large population makes all the difference for local startups, supplying millions of potential customers. “All the players, I think, are focusing on Indonesia and that’s why they win,” he said. “We are a huge market. That’s why most players are playing locally.

“We have a lot of competitors from Japan, from China, from Germany, but we can say that we are winning the game and that’s because we understand Indonesia very, very well compared to other players.”

The domestic focus can make it difficult to expand beyond the country’s borders, however. “It’s a huge challenge for us because we don’t understand the global market very well,” he said. “I think that’s the next 20-years road map for Indonesian startups.”

Challenges for Indonesian startups

One of the biggest hurdles for Indonesian startups is finding talent, agreed to Zaky and Lestari.

For the last five to 10 years, most graduates have gone to work for big corporations like banks, and oil and mining companies, they explained. “We need to change graduates’ minds,” Zaky said. “Look at startups, you have a better opportunity. It’s higher risk, yes, but it’s a better [culture] … We have a lot of computer science graduates, but changing their minds is tricky.

“We have talent, but they prefer to work abroad,” Lestari added. “The challenge is how to attract talent abroad and in Indonesia to join this new opportunity.”

Advice for startups looking to open in Indonesia

For foreign startups looking to open up shop in Indonesia, Zaky had two words of advice: “Be local.”

Saving that, make a great product that everyone around the world needs. He pointed to companies like Facebook and WhatsApp as huge success stories in Indonesia. “If you have great products, relevant to people all over the world, then it’s relevant to Indonesia,” he said.

Given the popularity of smartphones in Indonesia, Zaky also suggested looking to mobile-first. “Everyone would prefer to buy a smartphone than McDonald’s or KFC,” he said. “I think this is a huge opportunity and that’s why Bukalapak grew so fast because mobile is growing like crazy.”

More than 70% of traffic on Bukalapak is now via mobile. “95% of Indonesia Internet users will be mobile in the next three years, that’s my prediction,” Zaky said.

Zaky and Lestari believe the startup ecosystem in Indonesia is at a tipping point and venture capitalists are taking notice, such as one well-known American investor firm, 500 Startups, who also invested an undisclosed amount in Bukalapak and HijUp.

“The number of entrepreneurs is growing, the market is ready and I think right now we are trying to make Indonesia go to the next level,” Zaky said.

Originally published on www.mashable.com