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State-owned enterprises and startup, a recap of companies bowing out in 2023

Jakarta Globe - December 29, 2023

Faisal Maliki Baskoro, Jakarta – Businesses have shown resilience and growth throughout 2023, but for some companies, this year marks their final chapter. Intense competition and stringent funding conditions have led to the closure of various enterprises, spanning from startups to state-owned enterprises.

According to the e-Conomy SEA 2023 report, jointly released by Google, Temasek, and Bain Company, funding into startups in Indonesia amounted to $400 million (Rp 6 trillion) during the first half of 2023, a significant decline of 87 percent from the same period last year, as venture capitals recalibrated their expectations. This lack of funding made it difficult for startups to compete.

Meanwhile, in the public sector, the State-Owned Enterprises Ministry (SOE) shut down seven ailing companies this year, including airline operator Merpati Nusantara Airlines and construction company Istaka Karya. Merpati had ceased operations in 2014 and had undergone several restructuring. Istaka built the Ir Sedyatmo Toll Road project in 2007-2008, which connects the Soekarno Hatta International Airport in Banten to West Java. Unfortunately, payments for this project have not been received from Istaka Karya since 2011.

Here is a list of companies that shuttered their operations in 2023:

1. JD.ID

Intense competition and a series of layoffs impacting startup companies have led e-commerce company JD.ID to stop all its services on March 31, 2023. The company was a unit of China's e-commerce giant JD.com.

"JD.com aims to concentrate on establishing a cross-border supply chain network, with logistics and warehousing as its central business focus," the management said in an official announcement in January.

2. Pegipegi

Online travel agency startup Pegipegi announced the closure of its operations on Dec. 11, 2023.

"Nearly 12 years of being your travel solution has been an invaluable experience for Pegipegi. Regrettably, Pegipegi bids farewell," wrote Pegipegi in its official statement.

3. Rumah.com

After more than 10 years of operation, the property portal Rumah.com officially ceased operations on Nov. 30, 2023.

"Over the past 15 years, together, we have built PropertyGuru into Southeast Asia's leading PropTech company. Our marketplace business in Indonesia, operating as Rumah.com, will cease to operate on Nov. 30, 2023. This decision has not been taken lightly, and we recognize the impact it will have on our valued Gurus and customers, whom we have served for well over a decade," the statement read.

4. CoHive

Coworking space startup CoHive closed its journey in 2023 due to the prolonged pandemic, office supply issues, and funding problems over the past two years.

"Despite our best efforts to find solutions to our challenges, we could not endure any longer," wrote CoHive management in February.

5. Carl's Jr Indonesia

The American burger franchise Carls Jr will close its branches in Indonesia after 10 years of operation by the end of this year.

"Thank you for the tremendous support over the past 10 years. Carl's Jr. Indonesia will cease its operations under Mahadasha Group on December 31, 2023," said the management on its Instagram account last week.

6. State-Owned Enterprises

The Ministry of State-Owned Enterprises officially announced the dissolution of seven state-owned companies in 2023, on Friday.

The seven companies are airline operator Merpati Nusantara Airlines, glass company Industri Gelas, paper company Kertas Kraft Aceh, textile company Industri Sandang Nusantara, paper company Kertas Leces, construction company Istaka Karya, and financing company Pengembangan Armada Niaga Nasional (PANN).

"Of the seven companies, six of them (excluding PANN) have had dissolution regulations since April 2023. Subsequently, further processes will be carried out by the curator," said Teguh Wirahadikusumah, the Chief Executive Officer of the State Asset Management Company (PPA).

Source: https://jakartaglobe.id/business/stateowned-enterprises-and-startup-a-recap-of-companies-bowing-out-in-202