As Pence visits Indonesia to talk trade, Silicon Valley VCs meet in Bali
BALI, Indonesia — While Vice President Mike Pence visited Jakarta, Indonesia this week to discuss bilateral trade issues as part of his 10-day trip to Asia, investors, venture capitalists and regional start-ups gathered on the Indonesian island of Bali to discuss the future of tech in the world's fourth most populous and the broader region.
"What's happening politically with the H-1B visas being reviewed and the crazy stories you're hearing, people have to hedge their situation and see where the high growth is happening," Ahmed Shabana, managing partner of Parkpine Capital, a Silicon Valley firm, told CNBC. "It might be risky to get talent in the U.S. if things escalate."
The first of its kind, the Global Ventures Summit in Bali aims to find scalable technologies in high growth markets while connecting investors with ideas. The event included presentations from VCs and the likes of tech giants from Google to IBM. Shabana estimated $5 billion worth of investor funds taking part in the summit.
"We're viewing Southeast Asia and Indonesia as the new China and it's very obvious that something great is going to happen," said Shabana, adding that he thinks acquiring a customer in Indonesia will be costlier and more difficult in two to three years from now, which is why now is the time to get in.
Political uncertainty in both the U.S. and Indonesia is causing a ripple of anxiety here. President Donald Trump has repeatedly said he will seek trade arrangements that greater benefit his country, worrying many trade partners throughout the region.
"Donald Trump presents the danger of U.S. protectionism being misinterpreted to an economy here," said Wayne Forrest, president of the American Indonesian Chamber of Commerce. "A lot of questions I've had with government officials here are about Indonesia being on the list of countries being watched."
Forrest described Indonesia's potential for investment and scalable growth as positive — but not necessarily exciting. While the population and rising middle class is appealing for U.S. companies, Forrest said he fears infrastructure in the region still lags behind.
But for many U.S.-based VCs at the summit, the region as a whole is intriguing.
Southeast Asia is the fastest growing internet region in the world, adding close to 4 million new internet users every month, according to a report by Temasek and Google released last year. The internet economy is expected to be a $200 billion opportunity by 2025, according to the report.
It's prompted investors like Andrew Romans, general partner at Rubicon Venture Capital and author of "The Entrepreneurial Bible to Venture Capital," to make their first trip to the region.
"I think that the percentage of global GDP that the U.S. represents is going to keep going down and the percentage of GDP from South Asian countries is going to continue to grow," Romans said. "What's our strategy to get there?"
Romans said he attended the summit on his way to Singapore, as part of his trip to raise investor funds, meet start-ups and find opportunities with corporate venture funds in Asia.