Generalized Stigma Post-eFishery is Not Right, But We Must Face It
The Startup Reporter: 3 February 2025
With all the recent headlines about fraud at eFishery, it’s only natural for foreign investors to start doubting Indonesia’s startup ecosystem. Some might even generalize—assuming local founders and employees are deceitful and that Indonesian VCs are too naïve to see through the lies.
Of course, that kind of thinking is unfair. Fraud happens everywhere; one bad case doesn’t mean the entire ecosystem is rotten.
However, we still have to acknowledge that skepticism is understandable. Just like in mental health recovery, the first step is acceptance—recognizing the problem instead of staying in denial, right?
But does that mean we should just sit back and take it? Absolutely not.
Instead, we need self-reflection. We must rethink how we approach startup investments, as I discussed in my previous post. And rather than tackling this issue individually, we should work together as an ecosystem to rebuild trust.
Local VCs, I know not all of you have fraudulent founders in your portfolio. Some of you might have completely steered clear of bad actors. Logically, that should make you the top choice for foreign investors looking to bet on Indonesia’s startup scene—positioning you as the clear winners amid the turmoil, right?
Well, that’s not always how the world works.
Even if your portfolio is spotless, potential Limited Partners (LPs) will still bring up the eFishery case. Now other people’s problems also became your problems.
That’s why the first step is to acknowledge the broader issues within the local startup ecosystem. Then, you could tell foreign investors of how you can avoid those problems.
Better yet, why not share your best practices with other local VCs? The stronger the ecosystem as a whole, the better it is for everyone.
Willson Cuaca, managing partner of East Ventures, highlighted this in his opinion piece for Tech in Asia. He emphasized that beyond “capacity” and “capability,” an entrepreneur’s “character” is what truly sets them apart—regardless of their educational background.
A person’s true character is revealed under pressure and in times of crisis – not when everything is going well. Since a person’s character is molded over time, I firmly believe that great entrepreneurs are made, not born.
— Willson Cuaca
Meanwhile, Toronata Tambun, a Harvard Business School alumnus, pointed out in his opinion piece on The Jakarta Post that many startup founders fall into an overconfidence bias. They believe they can manage small ethical lapses without long-term consequences, assuming future success will justify present deception.
Employees, I know it would be an overreaction to assume that everyone at eFishery was involved in fraud.
In fact, a Tech in Asia report highlighted specific sections of the so-called “audit report,” identifying which executives were implicated and which were not.
But still, this is a problem we need to confront.
I’m aware that some eFishery employees have spoken out, stating they had no knowledge or involvement in the fraud. And honestly, the ones who were involved should show some decency by publicly clearing the names of their innocent colleagues.
It’s the least they could do, right?
Founders, I know most of you have no intention of doing anything unethical. Many of you are here to create real change and bring value to your communities.
Some, like my friend Bembi, have shared thoughtful reflections on his recent LinkedIn post, and it was a great read.
But then there are startup enthusiasts who believe the fraud case is nothing more than a conspiracy—that it’s all a scheme by VCs with hidden agendas to oust founders and executives.
My response? You’re entitled to your opinion.
But let’s be realistic. There has to be an incentive for someone to orchestrate something like this, and a VC has almost zero incentive to fabricate fraud within their own portfolio—especially if they hold a major stake in the company.
At the end of the day, our perceptions of people can be right or wrong. And people change—sometimes in ways that don’t align with what we expected or hoped for.
If you’re a basketball fan, think of it this way: You’d shocked if the Dallas Mavericks suddenly let Luka Dončić walk to the Los Angeles Lakers, right? But it is still happened.
So why be surprised if a founder or VC turns out to be different from the persona they project?
Cheers!
You’ve just read The Startup Reporter, a newsletter covering the hottest topics in Indonesia’s startup scene, along with behind-the-scenes stories that often don’t make it into mainstream media coverage.
This newsletter is written by me, Aditya Hadi—a journalist at The Jakarta Post and former writer at Tech in Asia. It’s published every Monday.
To subscribe, visit adityahadi.substack.com
I love how you explain the challenge through a couple of perspectives for Founders, Employees, and even Local VCs. Thanks for speaking up ya, Dit! 👍