Venturra Weekly Opinion Piece: Live Commerce, Health Care, and Financial Services in 2024

As we stand at the threshold of 2024, the Southeast Asian tech landscape vibrates with both opportunities and challenges. In this edition of Venturra Unfolded, we have compiled all the opinion pieces from the team in January. Our focus is on three sectors that are expected to experience notable growth: Live Commerce, Healthcare, and Financial Services.

Live Commerce: A TikTok-Powered Renaissance

Indonesia's live commerce arena is set for a thrilling revival with TikTok's strategic acquisition of a controlling stake in Tokopedia. This powerful synergy marks a pivotal moment, not just for these two industry giants, but for the entire market. Before its temporary absence, TikTok boasted an impressive $4.4 billion GMV in 2022, with projections reaching a staggering $15 billion by 2023. Indonesia's rapid growth within this realm underscores its immense potential, making it a market TikTok couldn't afford to lose.

This re-entry signifies more than just the return of a popular platform; it heralds the institutionalization of live commerce in Indonesia. Following China's trend, we anticipate the proliferation of dedicated live commerce studios and support services, catering to entrepreneurs seeking to navigate this dynamic space. From strategy consultancy firms to creative content studios and talent agencies, a comprehensive ecosystem is poised to flourish, empowering businesses to maximize their live commerce revenue streams.

With TikTok back in the game, Indonesia's live commerce landscape is primed for a renaissance. The combined strengths of these platforms promise to not only reignite growth but also reshape the industry, offering exciting opportunities for entrepreneurs and fostering innovation across the board.

Healthcare: Digitizing for a Proactive Future

Indonesia's healthcare sector is experiencing a remarkable surge, fueled by government initiatives, a health-conscious population, and a wave of digitization transforming the landscape. Despite a challenging funding environment, the health tech industry remains resilient, evidenced by Halodoc's recent $100 million Series D round. Furthermore, between H1'22 and H1'23, funding for health tech companies surged by a staggering 8.6x, according to the Indonesia Venture Capital Report.

One key driver of growth is the digitization of medical records, paving the way for innovative preventive healthcare solutions across the care delivery chain. The Ministry of Health's Electronic Medical Record (EMR) initiative facilitates efficient data retrieval and interoperability between healthcare systems. Local EMR providers like Klinik Pintar and Zi.care are utilizing these vast repositories of patient data to train powerful predictive diagnostic tools, enabling quicker diagnoses and early detection of chronic illnesses. This newfound data transparency empowers patients to take an active role in their health, shifting the focus from curative to preventive care.

Consumer trends reflect this proactive approach. Vitamins, health supplements, and functional foods are gaining traction, driven by increased disposable income and the rise of local brands challenging international incumbents. Total sales of health supplements in ASEAN alone are expected to reach $5.45 billion in 2024. Additionally, teleconsultations focused on chronic conditions are improving access to nutritionists and physicians, laying the groundwork for continuous remote patient monitoring.

Indonesia's healthcare ecosystem is rapidly integrating and digitizing, despite lingering disparities in accessibility and affordability. However, a combination of supportive government policies and a vibrant healthtech startup scene is diligently working to bridge these gaps and ensure high-quality care for all citizens.

Financial Services: Riding the High-Interest Wave

While rising interest rates may seem daunting, they often pave the way for new opportunities in the financial services sector. Since July 2022, Indonesia has gradually increased its interest rate from 3.5% to 6.0% by December 2023, aligning with the Fed's trajectory. This narrower gap has led to reduced liquidity in the national market, with investors opting for the perceived safety of the US market. Consequently, Indonesia's banking sector has witnessed slower growth in third-party funds (current accounts, savings, deposits).

However, challenges often breed innovation. This rise in interest rates presents a compelling prospect for both investors and entrepreneurs alike. Let's explore key avenues for growth:

• Alternative Lending Platforms: With traditional lenders tightening their belts, alternative lending platforms specializing in peer-to-peer lending and digital credit scoring can fill the void, providing much-needed capital to underserved businesses and individuals.
• Risk Mitigation and InsurTech: Heightened risk awareness in this environment opens doors for innovative insurtech solutions. Tailored insurance products, data-driven risk management tools, and advanced analytics can offer invaluable services to businesses navigating the complex financial landscape.
• Wealth Management Innovations: Traditional investments become less attractive in high-interest environments, fostering a demand for sophisticated wealth management solutions. Robo-advisors and AI-powered investment platforms, offering personalized, low-cost strategies, stand to gain significant traction among investors seeking optimal returns.

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