UpBanx, Indonesia’s fintech platform for creators and brands established mid last year, has secured $5.2 million in a pre-seed round as it gears up to expand its operations in the market.
The round has been co-led by Y Combinator and Alpha JWC with the participation of Alto Partners Multi-Family Office, Number Capital, and content creators Raffi Ahmad and Nagita Slavina, besides Collab Asia, and DRM (Digital Rantai Maya), Wafa Taftazani, CEO and co-founder at UpBanx, told DealStreetAsia.
Others who infused capital are Oliver Jung, who was an angel investor in home-sharing company AirBnB, and American financial services company Robinhood; Frances Kang, investment director at Horizon Ventures, and Hendra Kwik, co-founder and CEO at Fazz Financial Group, among others.
“Although it’s still very early days for UpBanx, with only six months of operation, its valuation has touched $120 million,” said a source privy to the company’s plans. The figure, however, could not be independently verified by the company.
UpBanx, co-founded by Taftazani, along with Hendri Wijaya and Alif Jafar Fatkhurrohman, is a fintech firm that caters to creators, brands, freelancers, and agencies, among others. The startup helps them get financing, grow commercial partnerships, incorporate and raise investments.
The market of influencer and marketing in the archipelago is increasing every year, driven by the growth of social media, combined with the amount of time spent by Indonesians on online media.
According to data available with Statista, about 98.5% of the country’s internet users watch videos on social media to gain knowledge on products across sectors. The penetration rate of instagram touched 86.6% in Q3 2020.
According to a survey on social media influencers conducted by Rakuten Insight in October 2020, approximately 49 per cent of Indonesian respondents between ages 25 and 34 stated that they would rather opt for a product endorsed by influencers instead of going in for a similar product available in the market for the same price.
However, the growing market isn’t aligned with the transformation of influencers and creators. In Indonesia, Taftazani explained that the ecosystem is still manually driven and creators find it difficult to gain financial access to develop their contents.
“Therefore, we will build UpBanx as a combination of US-based creator and brand agency platforms such as Brex, Carat, GRIN, and Singapore’s fintech for influencers, Friz. Upbanx will be the hub of creators, brands, and freelancers ecosystem, not only providing the financial needs but also connect and create partnerships between the brands and creators,” Taftazani, a Youtube, Shopee and Google veteran said.
With UpBanx’s first-ever fundraising exercise, the startup plans to accelerate its product development and business growth, leveraging on Y Combinator’s world-class accelerator programme and investors’ experience, said Taftazani.
Indonesian fintech firms raised a total of $494 million in funding in the first half of 2021 (1H2021), surpassing the total investment amount of 2020 by 75 per cent, according to a UOB report.
Early-stage startups (those that secured capital in their Series A and B rounds) raised the maximum amount of capital in 1H2021. Investment tech firms and finance and accounting fintech firms attracted major investor interest, thereby garnering 43 per cent and 28 per cent of all the funds raised in 1H2021.
Indonesia is the most populous ASEAN country, home to over 275 million people. The country is undergoing a digital revolution – a trend that’s increasingly attracting investors. Internet user penetration in Indonesia reached 67 per cent in 2020 and is expected to rise by another 20 per cent by 2025.
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