So Bukalapak is basically 'open your stall.'

They might look like your typical street stalls, but behind Indonesia's family-owned kiosks is a multibillion-dollar business.

The population is like 270 million, so are you saying that 20 to 25% of people

set up one of these shops? I'm like exactly!

And as it helps small businesses modernize, Bukalapak hopes to revive an iconic segment

of the country's economy.

Every, maybe 50 or 100 houses, there will be one of these guys who opens a shop in their house and they like sell basic goods.

Water, soap, coffee or whatever, right. They have been like that since the beginning and,  

as the economy grew, they are  like basically left behind.

Bukalapak is an Indonesian e-commerce  marketplace designed to help the country's  

millions of mom-and-pop kiosks,  known as warungs, to come online.

Today, the company boasts tens of millions of  customers across the sprawling archipelago.

But when Bukalapak was founded  in 2010 by Achmad Zaky,  

it was simply as a way to help his neighbors.

CEO Rachmat Kaimuddin told me more.

My predecessor, Zaky, one day went back to his  hometown and was looking around, and he saw all  

these small businesses, his neighbors, and he  was like taken aback and realized like, okay,  

these guys have looked the same for decades.

And now I know technology, I've learned  about the internet and everything,  

and I wonder how could I use technology  to help people improve, do better.

So, Achmad, who was then a 23-year-old student,  

teamed up with his friends Fajrin Rasyid  and Nugroho Herucahyono from the

Bandung Institute of Technology to create a site  to help small businesses sell online.

The capital he used to start this company is just  the registration fee to register the website,  

and it's like 80,000 rupiah or maybe about like  $5 or so. That is the seed capital of Bukalapak.

Soon, Bukalapak was live, acting  as a third-party intermediary to

support purchases between consumers and merchants.

But the company's real  breakthrough came some years later.

In 2017, the company launched Mitra Bukalapak to  help these shops compete with modern retailers  

by offering additional online services  such as bill payments and phone top-ups.

Mitra Bukalapak also connects these  warungs to consumer goods distributors,  

narrowing their supply chain,  lowering the cost price of their wares  

and increasing the profit margins  for these micro businesses.

In the same year, the company, which  earns a commission for each transaction,  

reached a billion-dollar valuation.

Khailee Ng, managing partner at 500 Startups,  was one of Bukalapak's early backers.

When I first met the Bukalapak  founders, like I was very,  

very impressed by how not only competent  they were but how local they were.

They so deeply understand life  outside of tier-one cities.

So I think that their kind of local DNA,  

it really translated through what  the business eventually became.

In January 2020, after a decade at the helm,  

Achmad stepped down as CEO, 41-year-old Rachmat,  a former banker, was selected as his successor.

Achmad, who now runs an entrepreneurship  foundation, still holds an advisory role  

with the company, while co-founders Fajrin  and Nugroho have both left the firm.

I think Zaky basically saying like,  look, I've led this company from  

zero and it's probably time  for me to extract myself.

We probably need someone who can make this,  the company that I built, more professional,  

bigger, and we see that you could help  us do that. And I was like, okay. Really?

For Rachmat, it was an  opportunity he couldn't refuse.

There's a lot of discussion on the values and the  mission. That is my cross, right, to bear, right.

The mission is we need to serve the underserved.  We are e-commerce, we need to improve lives  

not only for profit but also  for the betterment of society.

Within Rachmat's first 100 days in the job, the  pandemic struck. The resultant lockdowns hit the  

millions of warungs and small and medium-sized  enterprises hard. Bukalapak was at a crossroads.

We need to ensure that the SMEs can still  transact. The only way to do that now, or  

at the time, was online, right. So, our task is to  create a much more efficient onboarding process.

Failure is not an option. We cannot  just give up and say like, okay,  

Covid, maybe let's take a break for  a year. People actually need us.

E-commerce, meanwhile, has been  one of the pandemic's big winners.

In 2020, Indonesia's digital consumers  surged 37% as lockdowns led more people  

to try new services online.

In the same year, online spending rose 11% to hit $44 billion.

By 2025, that figure is expected  to almost triple to $124 billion.

Bukalapak has ridden that wave, recording  a 130% surge in transactions in 2020.

The company now serves 13.5 million micro, small and  medium enterprises and 100 million customers.

That rapid adoption should help Rachmat with  his primary task: reaching profitability.

This is a big organization and we  want to be there for a long time.  

Of course, growth is nice and we all want to have  more growth, more transactions, more customers,

but we need to see whether we can create an organization that can be self-sustaining moving forward.

That hasn't stopped investors  from piling onto the business.

In January 2021, Standard Chartered  bank became the latest corporation to  

join a $200 million funding round  to fuel the company's expansion.

The partnership will help build Bukalapak's  digital banking service, while a separate deal  

with Microsoft will see the company adopt the  tech giant's Azure cloud computing platform.

Other investors include Indonesian  media conglomerate Emtek,  

Alibaba-affiliate Ant Financial and  Singapore's sovereign wealth fund GIC,  

pushing the company's estimated valuation  to between $2.5 billion and $3 billion.

That ranks the 11-year-old company among  Indonesia's growing number of unicorns,  

whose names include fellow  e-commerce player Tokopedia,  

ride-hailing giant Gojek  and travel site Traveloka.

The world's fourth most-populous country  has the largest number of internet users  

in Southeast Asia, and analysts say  it has potential for more growth.

A lot of folks feel the demographic dividends  are going to pay off. 270 million people,  

most of them with smartphones now.

What is super fascinating to me is  that how much of that investment  

goes into tier-one city-targeted business  models versus Indonesia business models.

While some analysts are skeptical about  Bukalapak's ability to expand beyond Indonesia,  

given its hyperlocal roots,  

Rachmat says he is confident that the  company's importance transcends borders.

I'm not going to say that we just want to stay  in Indonesia but Indonesia today is a big enough  

market to keep us very busy, and we still feel  like we have a lot of homework to do.

I don't think we've even scratched the surface if you  talk about underserved markets in Indonesia.

Today, 70% of Bukalapak's business  is non-tier-one. I don't think a lot  

of people think about that too much as well, that,  

you know, you can actually make a lot of money  by serving a population which doesn't have that  

much money, so I look forward to seeing more  entrepreneurs actually build more companies  

that can serve the broader populations, not just  in Indonesia but broader populations in the world.

After experiencing tremendous growth in 2020,  and with potential for more on the horizon,  

the company may have plans for an  initial public offering later in 2021.

Having access to capital markets is good to  have for a growing company, and I think that  

is one of the options that we are considering.  We are not to say anything until we have proof.

But, of course, this is something that  we understand to be important.

And we are preparing ourselves to be IPO-ready.