Study Finds 98% of Indonesian Startups Were Just Elaborate Excuses to Raise Seed Rounds
Report reveals Indonesia’s startup boom was built on fundraising, not innovation. Founders raised, cashed out, and moved on.
JAKARTA — A new study released this week by the Institute for Emerging Market Truths has found that 98% of Indonesian startups were created not to build businesses, but to raise seed funding and then immediately start raising the next round.
The report, based on interviews with over 300 founders and a forensic analysis of LinkedIn activity, concluded that “fundraising had quietly replaced innovation as the core product.”
“After a while, we realized none of these companies were actually designed to sell anything other than themselves,” said Dr. Lestari Nugroho, who led the research. “The MVP was always the pitch deck.”
The study found that the typical Indonesian startup lifespan followed a predictable pattern:
Brainstorm an “idea” over coffee.
Raise a seed round to “explore the concept.”
Raise a Series A to “scale the concept.”
Raise a Series B to “pivot away from the concept.”
Quietly fold or get acquired by another startup doing exactly the same thing.
“By the time anyone asked whether these companies were making money, the founders were already ‘advisors’ to three other startups and living in Bali,” Nugroho added.
In follow-up interviews, several founders openly admitted that profitability, product-market fit, and “actual products” were often treated as secondary to the “real work” of fundraising.
“I mean, building an app is fine,” said one Jakarta founder, who requested anonymity. “But the real game? Convincing VCs to give you enough cash so you can look big enough to convince other VCs to give you more cash. That’s the loop.”
When pressed about why so many startups collapsed, the founder shrugged. “Collapse? That’s just when you stop raising. It’s like breathing. You can hold your breath for a while, but eventually, you have to inhale or you’re done.”
The study even found startups who had never shipped a product yet had raised three rounds. “We interviewed one founder whose ‘minimum viable product’ was a PDF of an idea for an app,” said Nugroho. “He called it an ‘alpha demo.’ He raised $4 million.”
The findings have shocked some venture capitalists, many of whom insisted they had no idea they were essentially funding a cottage industry of pitch deck designers.
“We thought we were investing in companies,” said one Singapore-based VC partner. “Turns out, we were just paying for increasingly elaborate PowerPoints. At one point, I funded a startup whose deck had a cinematic trailer. I don’t even know what they sold.”
Despite the revelations, the report noted that the fundraising carousel is already spinning again. Several founders from collapsed startups have resurfaced as “mentors” and “advisors,” launching new companies that, according to early pitch decks, will “redefine fundraising itself.”
“They’re calling it ‘Fundraising-as-a-Service,’” Nugroho said. “At least they’re honest this time.”
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