At NEA, we pay particular attention to fast-growing startups serving emerging economies with exceptional user experience and brand. As part of this effort, we have been digging into investing in technology startups in Southeast Asia whose successes may have outsized impact in the communities they serve. One of the countries we are excited about is Indonesia.
As we continue to learn more about the startup ecosystem in Indonesia, we are more and more impressed by the new generation of Indonesian entrepreneurs building exciting companies, especially in e-commerce and fintech. But, we’ve noticed that the focus is often on serving the more affluent and better-connected customers residing in tier-1 cities. This is largely due to Indonesia’s unique geography—consisting of 17,000 islands—which makes building a seamless national e-commerce logistics network a challenging problem. And this results in a bifurcation of accessibility to e-commerce between consumers residing in tier-1 cities vs tier-2 cities, tier-3 towns, and tier-4 rural areas.
What this means is that consumers living in non-tier 1 cities are often required to pay unaffordable delivery costs on top of already higher prices for basic necessities when ordering from most e-commerce marketplaces. For example, in many cases, top Indonesian marketplaces charge delivery fees as high as 50% of the order subtotal to ship to non-tier 1 city addresses, effectively making the purchase not affordable for many consumers living outside of tier-1 cities. This means that the majority of Indonesian consumers are largely thwarted from taking advantage of buying goods online—a magical shopping experience that is now default for so many of us.
Super brings that magical experience of buying goods online to the 260M+ Indonesian consumers living outside of tier-1 cities by harnessing the power of social commerce. This makes Super’s market opportunity truly massive. The 260M+ of potential Super customers living outside of 1st tier cities represent over 90% of the Indonesian population and are responsible for over 70% of the total GDP of Indonesia. Super builds and operates a network of warehouses and logistics equipment which uniquely enables them to fulfill orders quickly and efficiently. Before Super, the prices of basic household items (e.g. rice, milk, coffee, noodles, cooking oil, sauces, etc.) were often twice as high in tier-2, 3 and 4 areas vs. the prices in tier-1 cities. Super is able to solve this challenge and provide the best prices for household necessities by streamlining the order process, creating more efficient supply chains and enabling economies of scale.
Super also solves complex logistical challenges and simultaneously creates high quality jobs via a network of Super Agents. Super Agents—many of whom are homemakers looking to generate extra household income—help place group orders for their community using the Super app. These Super Agents collaborate with both local warungs (small neighborhood stores) and directly with end consumers. Super Agents become small-business owners and they are able to work whenever and however they want according to their needs and desires. Super trains the agents to be the best at what they do by holding workshops, sharing regional demand data as well as case studies of other successful Super agents. The incentives are incredibly well-aligned: the success of Super Agents equals success for Super.
Super’s positive impact on the communities it serves
According to a McKinsey & Company study, over 90% of the environmental impact associated with the consumer sector comes down to supply chain management. Super’s hub and spoke model in supplying and distributing day-to-day essential goods significantly reduces not only the cost but also the carbon footprint of e-commerce delivery.
In traditional e-commerce models, orders need to be individually boxed and shipped to the end customers one at a time. Super’s group buying model enables a significant reduction in both the packaging and transportation carbon footprint for every fulfilled item. We believe that the successful scaling of group buying and hub and spoke distribution models in Indonesia will contribute to having positive environmental impact while accelerating e-commerce adoption of the non-tier 1 city residents served by Super. Furthermore, Super’s data-driven approach to further optimize the supply chain and delivery routes will have a massive positive impact in reducing the carbon footprint and enable Super to grow in an environmentally-friendly way in the long-run.
Super is also committed to encouraging its customers to make healthier food and lifestyle choices. For example, despite cigarettes being a high-demand item, Super does not highlight or promote cigarettes within its app and has a policy of not showing any pictures of available cigarette products. These products are placed in the app in a way that is designed to decrease impulsive cigarette consumption while still preserving the rights and freedom of adult customers who want to purchase them. In addition, cigarettes are excluded from promotions, vouchers, or flash sales. The Super team is also developing a new health and wellness section in all their training program materials, including lessons on the harmful side effects of cigarette consumption and the consequences of consuming highly processed foods, high sugar content, and more.
Super’s stellar team
Members of the NEA team have known Super’s co-founder and CEO Steven Wongsoredjo for over two years before making our investment. As we became more privy to the breadth of the team’s ambitions and their excellent execution track record through our diligence process, we grew more confident about the team's potential to build a monumental company. Super was co-founded by CEO Steven Wongsoredjo, who grew up in a retail family business serving tier-2, tier-3, and rural areas and is deeply committed to the long-term health and economic development of these communities. Super co-founder and CTO Willy Haryanto is a serial tech entrepreneur who built and sold a food e-commerce startup prior to Super. Co-founder and CPO Michael Rendy worked closely with Fortune 500 companies selling to non-tier-1 cities in Indonesia before working on Super’s products. Furthermore, Co-founders Debeasinta Budiman and Garret Koeswandi were honored last month by Forbes as featured recipients of the Forbes 30 under 30 list. Finally, Super was recently named as one of Y Combinator’s Top Private Companies of 2022.
We’re thrilled to partner with Super on their journey to building an iconic e-commerce company serving hundreds of millions of Indonesians. If you are interested in joining Super’s team, drop them a note via firstname.lastname@example.org.
NEA makes no assurance that investment results obtained historically can be obtained in the future, or that any investments managed by NEA will be profitable. To the extent the content in this post discusses hypotheticals, projections, or forecasts to illustrate a view, such views may not have been verified or adopted by NEA, nor has NEA tested the validity of the assumptions that underlie such opinions. Readers of the information contained herein should consult their own legal, tax, and financial advisers because the contents are not intended by NEA to be used as part of the investment decision making process related to any investment managed by NEA.