Jakob Rost left Berlin for Indonesia more than 7 years ago as director of Lazada. Jacob built the Lazada market from the ground up to 70% of GTVs and led the geographic expansion.
Prior to that Jacob worked as a management consultant for the Boston Consulting Group on projects in banking and financial services. After the takeover of Lazada by Alibaba, Jacob founded Ayoconnect together with his two co-founders; he is still the general manager today. He and his Indonesian wife have a daughter and live full-time in Jakarta.
Ayoconnect is Indonesia’s leading open ticketing network, offering over 2,500 ticketing products in 20 categories. The network connects account providers, such as utilities, telecommunications companies, aggregators or publishers, to consumer-oriented platforms and financial institutions. Categories of delinquent accounts include telephone loans, electricity and gambling vouchers.
The company has recently introduced regular payments for real estate and training. To date, Ayoconnect has successfully processed more than 40 million transactions and enabled channel partners to offer and monetize payments to their customers. For their part, account providers use the network to collect periodic payments from consumers faster and cheaper.
Ayoconnect operates, maintains and expands the network and provides companies with the right internal infrastructure technology.
In an exclusive interview with the AsiaTechDaily, Jacob Rost says…
Understand where you’re standing and get out. Product compliance is the key to successful market entry, but it is only one of the elements in a world where consumers face new challenges that allow technology to act as a solution. I say the best advice is to solve problems that have long-term consequences.
I want my daughter to find the best way, whether it’s the choice of profession, hobbies, etc. Since there are social networks at the beginning of her life, I think it is important that the next generation knows where she is in the real world instead of focusing too much on her schedule. The second living being strives for a healthy lifestyle. Above all, I want her to know that whatever path she chooses, she must believe in herself and be ambitious and passionate.
Read on to find out more about Jacob Groei and his journey.
Tell me about your personal experiences and what motivated you to work for your company.
Jacob Growth: I had business and management experience and worked for a number of years in investment banking and management consulting across Europe. One day I got a call from all over the world that it was a company that wanted to set up e-commerce in Southeast Asia and was looking for people adventurous enough to make it happen. Then I became general manager of Lazada, Indonesia.
In 2016, Alibaba took control of Lazada with an initial investment of $1 billion, and at that time, I believe, the technological services landscape in the country began to take shape. I quickly realised that the payment system for invoices was largely offline, fragmented and manual. Together with my friend, we decided to establish a technology company that is capable of setting up a basic infrastructure for the fast, secure and smooth payment of digital bills, which today has become Ayoconnect.
What is your current main product and can you give a product sales history?
Jacob Growth: Our nationwide network includes more than 1,000 account providers and consumer partners in 34 provinces, including Indonesia’s best known telecommunications companies, utilities, e-commerce platforms, banks and online and offline retailers. We use smart invoicing technology combined with innovative services to provide tailored, business-oriented solutions that increase our partners’ return on investment, allowing them to grow and run their business more efficiently. Currently, our main account categories are telephone credit, electricity bills and gambling vouchers. Recently we also released a solution for recurring payments for real estate and education, vehicles and property tax revenues.
We started at the end of 2015, but our business model has officially changed from B2C to B2B since June 2020 to offer our partners better business continuity solutions and more comprehensive digital billing services.
How much money have you raised so far? When was the last financing cycle?
Jacob Growth: We look forward to working with our existing and new investors who share the strategic importance of Ayoconnect’s vision to organize the entire Indonesian billing ecosystem in a centralized network. We raised $5 million in a series of early-stage B financing from strategic global investors and more than $10 million.
What are the internal decision-making processes that determined the start of fundraising and what logistics are involved? And how many investors did you meet, how did you get to know these investors, and which channels worked best for you?
Jacob Growth: We are looking for investors who share our vision of developing cutting-edge technology to improve Indonesia’s financial performance and strengthen the digital economy. They should not only be able to benefit from the injected funds. This can take the form of an experiment, a network, or a strategic selection.
Our Pre-Series B fund is used to invest in technology and partner network expansion to bridge the gap between billing and distribution partners who have a solid infrastructure that can provide our digital payment partners with reliable, secure and timely invoice payment services.
However, we are very pleased to have the opportunity to support some of the most experienced companies in the region. The investors in this round are BRI Ventures, a venture capital arm of BRI Bank, listed on the Tokyo Stock Exchange (TYO) by internet company Kakaku.com, Inc. and Brama One Ventures. Existing investors also participated in the round table, together with Finch Capital and Amand Ventures, a global specialist in financial technology. Other existing investors in Ayoconnect are Strive and AC Ventures.
What are the main challenges and obstacles in the fundraising process? If you had to start over, what else would you do?
Jacob Growth: The pandemic that started at the beginning of the year caused financial disruption worldwide. Investors are increasingly reluctant and are no longer willing to take risks. However, we soon realized that our technology was the solution that Indonesian end-users, account providers and consumer-focused platforms needed more than ever.
Every month we see an increasing number of transactions. In the difficult times caused by COVID-19, our company will continue to focus on providing an all-inclusive payment option by creating more effective solutions together with our partners.
What are the milestones for the next cycle? And what are your goals for the future?
Jacob Growth: We will continue our commitment to the account payment industry, where we also want to create more efficient solutions that we can implement for our customers (account providers and business partners). Some of those we hunt are indeed a blue ocean with hundreds of thousands of microcomputers; with the enormous potential and range of 360º products we can offer, we are convinced that the time has come. We also have a number of interesting projects and announcements in store.
How did you attract users and what strategy did you use to grow your business from start to finish?
Jacob Growth: We are a B2B company, which means that our clients are public services, public companies, private companies and financial institutions. Understanding the challenges our customers and partners face and being able to solve them with indispensable solutions was our main selling point.
We regularly contact our partners to continuously improve our work and at the same time receive valuable information from them. As the leading B2B network for subscription payments and digital product solutions, Ayoconnect has grown significantly and offers innovative solutions that solve real problems.
Which software was the best marketing tool to develop your start-up and why?
Jacob Growth: We have noticed that most industries that need billing and network services will approach us, but we are also expanding our audience organically. We are currently working with a cumulative number of integrations to integrate them into our API. In recent years we have invested a lot in creating an excellent technology platform and operating system. These decisions are now bearing fruit.
That most starters are usually wrong about marketing?
Jacob Growth: It is essential to understand your target group, whether they are B2B or B2C customers. This means you can use the right channels and messages. It was also an instructive experience for us, especially in the early years. If you don’t do the right thing, you risk losing a lot of time and money. In addition, we believe that marketing is becoming an increasingly longer process. Building the right reputation and brand takes time; there are no quick wins. We have realized that we want to be a long-term partner for our customers and support them in this.
How would you like to develop your activities worldwide?
Jacob Growth: The total population of Indonesia is 272.1 million. Payments from bills such as gas, water, utilities, internet subscriptions, insurance, rent, tuition fees, etc. account for a significant proportion of total GDP. It is a huge and highly fragmented ecosystem with enormous potential for continuous improvement: That’s what we’re going to focus on now.
Our strategy is to develop efficient and transparent solutions for the Indonesian billing ecosystem to improve our partners’ ability to collect payments while improving the quality of service to their customers. We achieve this by having the most talented and motivated people working together, far away from the two countries. Our technical center is located in Pune, India, and our headquarters are in Jakarta, Indonesia.
What are the most common mistakes companies make in their global expansion?
Jacob Growth: We see the need for invoicing and payment and scanning technology in many markets outside Indonesia. But we have also recognised that the Asian market is very diverse in terms of culture, language, currency and political systems. This requires a specific and highly localized approach.
How do you manage the Kovid 19 flash situation to ensure the survival of your company?
Jacob Growth: We will move to PWN in early March to ensure the safety of our team and to continue to evaluate the policy and the DIS to maintain effective performance. We have also been very cautious and limited in our spending. We help our partners to develop their businesses and we are constantly introducing innovative, high value-added solutions that enable us to further increase our revenues.
What are the most common mistakes founders make when starting a business?
Jacob Growth: There are many similarities; the most important thing I’ve found so far is finding the right product on the market (PMF). All products, services, and other successful entrepreneurs have given their customers the much-needed benefit of the solution. Finding the right product for the market is a prerequisite for controlled and stable growth; a company can only develop a valuable product if it focuses on what the customer really needs. One thing to consider is customer feedback. With the right tools, this information can give you an idea of how your product is received and whether it is suitable for use in a product of minimal feasibility, or whether a further iteration is required. Failure to do so usually leads to the introduction of a solution that does not meet market requirements and is unsustainable for the economy.
What is the best advice you have ever received? And what advice can you give to someone who wants to do similar things with you or go in a similar direction?
Jacob Growth: Understand where you’re standing and get out. Product compliance is the key to successful market entry, but it is only one of the elements in a world where consumers face new challenges that allow technology to act as a solution. I say the best advice is to solve problems that have long-term consequences.
What are the three most popular books or movies (series) that changed your life and why?
Jacob Growth: In general I like company films or soap operas like Suites or Trillions. I’ve heard the continuity is good, but I haven’t been able to see it. 16. How can one maintain motivation on a daily basis? The excitement about what we’re creating, the impact we’re having and how we’re doing the financial and accounting digitization has really motivated me and the whole team. Personally, I feel that routine motivates me, too. I try to integrate this into my team by holding a 30-minute online session for department heads every morning.
It’s about informing everyone about new updates and what to do, and creating a familiar lifestyle. The close cooperation and hand in hand with the whole team to realize our vision is also what I am looking forward to tomorrow.
What are the three most important life lessons your (future) sons and daughters need to know?
Jacob Growth: I want my daughter to find the best way, whether it’s the choice of profession, hobbies, etc. Since there are social networks at the beginning of her life, I think it is important that the next generation knows where she is in the real world instead of focusing too much on her schedule. The second living being strives for a healthy lifestyle. Above all, I want her to know that whatever path she chooses, she must believe in herself and be ambitious and passionate.
Why do you want to be remembered?
Jacob Growth: It will play a modest but important role in promoting the Southeast Asian technology ecosystem and guiding early development with Lazada and Alibaba, through our own company Ayoconnect, or by encouraging new founders and new companies to start up and grow, and helping them on their way.
You can follow Jacob Growth here.
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