Why Jakarta shouldn’t be the epicenter of tech startups in Indonesia

If you look at all the big tech events happening in Indonesia, you will notice a pattern. You don’t have to be Sherlock Holmes to see that most of the things happening in the tech industry in Indonesia actually takes place in Jakarta, our beloved capital city. It’s an amazing city, we have airports, malls, fast internet and so on but it turned out to be one of the worst place for the tech industry to grow.

Of course there’s several good reason on why Jakarta is good for the growing ecosystem. The availability of international airport, center for business and being the nation’s capital are a few examples. Most businesses have an establishment and HQs in Jakarta, I couldn’t disagree with that, but there are a few facts that makes other cities better options for tech companies and the industry in general.

I’m going to compare Jakarta with two other cities : Bandung and Yogyakarta. There’s a lot of things happening in these two cities, and I think there should be more.

First of all : infrastructure. Jakarta is notoriously famous for it’s traffic jam, an achievement we obtained 3 ago years while the middle-class economy is growing fast and middle-class people can now afford a car (or two). It does show that the potential market exists in Jakarta but any foreign businessman who have visited Jakarta will know how hard it is to do business in Jakarta. Simply said, it’s a very contra-productive city.

Second, it’s the characteristic of the tech people in Jakarta. We’ve seen several developer event that went pretty well in Jakarta, but if you look closer to most of the engineer/developers/hackers are coming from cities outside of Jakarta. Cities like Bandung, Yogyakarta and Malang produces significant amount of high-quality engineers/developers while Jakarta is more business-minded people. Of course there’s some good developers in Jakarta, but if you compare it to other cities then it’ll become clear that Jakarta is not producing enough good hardcore developers.

Cities such as Yogyakarta and Bandung has arguably more advantages compared to Jakarta. Allow me to elaborate.

First advantage : amazing universities. Sure, Jakarta has some good universities but Yogyakarta and Bandung has the best universities in the country. There’s ITB (Bandung Institute of Technology) in Bandung and UGM (Gajah Mada University) in Yogyakarta, not to mention tons of other smaller universities and some of them even focuses on technology and engineering.

Amazing universities is crucial because it invites people from outside of the city to migrate to study, and the graduates has a strong tendency to stay in for work right out of college. This brings significant human resource for companies to absorb, and of course the young productive and well-educated population is a significant advantage especially for technology companies that relies on constant innovation mostly driven by young people.

Another plus point for Bandung and Yogyakarta is the supportive culture for creativity and being different. If you spend enough time in Jakarta, Bandung and Yogyakarta it will become clear for you that in Jakarta people don’t tolerate creativity and a small dose of crazyness (in a good way, that is) compared to Bandung and Yogyakarta. More artists can be found in Bandung and Yogyakarta rather in Jakarta.

Infrastructure wise, Yogyakarta and Bandung is on the same level with Jakarta if not better. Airports, electricity, fast internet connections. You name it, they have it. In fact, one of the weak point for Jakarta as a business center is that it’s not as well-distributed as Bandung and Yogyakarta. Jakarta’s business is basically very centered and too clustered in certain areas, while in Bandung and Yogyakarta is more well-distributed throughout the city.

In conclusion, Yogyakarta and Bandung might not be a good option for most businesses to set up their HQs, but it basically has all the things needed for a tech company to be present, based and operates from. And in a lot of sides, way better than Jakarta.