Niki Luhur: We Cannot Go It Alone | Endgame S2E16

oh and i think the more open we can be and encourage healthy levels of competition right healthy levels of competition and get people to aspire and dream bigger and invest back in the community to help you know hold people's hands in this initial journey to give people those initial opportunities to do things they never thought they could do and let them you know throw them in the deep end and then realize that hey they can't swim [Music] all right uh hi nikki how are you great good to see you uh i've noticed you've grown some beard and mustache is it covet related or it's related to something else well it's the beauty of work from home right you get to be a little bit more relaxed all right let's let's start off with with this talk i i want to just hear more about how you grew up and i know you ended up majoring in psychology and philosophy at a really great school but but talk about your early days so you you were born in jakarta and then you went over to the us and all that good stuff yeah so i think you know born in jakarta and you know grew up up until around uh and then high school was in the u.s in california i went to a small boarding school there and i think ever since i was a kid i was i was pretty obsessed with computers uh it was honestly gaming that got me very obsessed with computers and very competitive with friends and and how i started using the internet was actually just to you know play play games online against friends so i mean i remember you know playing on a on a 1200 bps modem or and then a 14k modem and really you know dealing with the pains of connecting with that that beautiful screeching sound of the men [Laughter] and yeah all of that good stuff so for for me it was it was gaming that that really got me you know and really a lot of strategy and first-person shooters that made it really competitive and got me looking into how do i overclock my processor how do i upgrade my gpus what do i how do i upgrade my in the ram and my memory just to get that extra little edge on your frame rate um and in the end and then of course as things went online understanding how to network and how do you reduce your latency on the network and in the end i didn't even realize that it was you know it was reading about competing for me it was just about gaming it was about beating my friends at the game and then that was the real motivation at the expense of your school time of course oh i did so that was actually something my parents did very well as they oh yeah they managed to incentivize my uh good academics with uh getting gaming upgrades so they they figured out a cycle so i would work hard in school so then i could get those uh pc upgrades and uh and then enjoy my games even more okay and and you went to college and studied psychology and philosophy what would did you plan to study those before entering college or you sort of like figured it out after taking some classes actually i i went into college uh very determined to to study genetics actually wow fascinating uh in in high school i was very much an engineer um it was about math everything exactly you know about mathematics everything through calculus to uh you know uh to of course all the sciences physics chemistry biology and it was really in those were sort of my forte and and where it really got me interested was in biology and specifically in genetics and studying uh fruit flies and and the the thought of being able to map the human genome was absolutely fascinating which at that time you know obviously had been done but in a very slow way but not in a personalized uh human genetics and i think the advancement of genetics especially married with computing power um just just advanced the field tremendously and yeah um and then i went into college very determined to study genetics and very much the idealist of wanting to find the cure for cancer and and was very obsessed with telomeres specifically and how to understand uh cell decay at a at the most fundamental level and and actually looking at the abstract phenomena of cancer of how actually it's the telomere malfunctioning that causes growth but technically reversing cell decay but ironically killing someone because of overgrowth um so the simple concept was if we could really understand the mechanics in a lot more detail perhaps there's a way to unlock the the secret of decay and an aging right in life and that was a simple you know simple hypothesis highly oversimplified i'll caveat that but but you know as they say cancer is the the worst perversion of genetics because it replicates right sorry i cut you off go ahead it's i think you know i i went in very determined in college and uh i i was assigned an advisor and i it was it was quite an experience i remember my first day meeting him uh professor daniel dennett he has this huge white beard and his bellowing voice and uh and it was an extremely well renowned professor of philosophy and i uh frankly i had done a lot of advanced placement in my sciences and where i was lacking was in my humanities so he convinced me to take his class and uh and and i found it fascinating and uh concepts of consciousness and intelligence and ultimately what we would call now of not only intelligence in living things but is intelligence achievable in computers and the concept of what's now called singularity um but back then was very much his theory of consciousness and i found that absolutely fascinating um and hence this field of cognitive science was a sort of a mash-up between philosophy psychology neuroscience computer science so it definitely had a lot of science behind it as well but it was much more abstract back then um you know and and i think that's where it got me really interested and fascinated and on the flip side i placed into some advanced uh genetics courses in my freshman year and um to my to my dismay i found that i was assigned to doing another fruit fly experiment where twice a day you would have to knock out and count these fruit flies and breed six generations of fruit flies and have a lab work very tough uh and not uh it was more of a question of you know is this is this the life that's cut out for me a life of academia and research as much as i loved it intellectually i thought the the rigor the academic rigor uh that's needed and the persistence and persistence and discipline i say i have to tip my hats to all of those phds out there that have i'm sure spent thousands if not tens of thousands of hours to perhaps come up with you know very very minimal results and you have to keep trucking along and and that you know and some and then hope for that breakthrough and i think that's an incredible amount of patience and and i learned that i i don't have that patience and uh and they so when i started exploring different areas and very much inspired by professor dennett and he opened up this whole new field that i had never explored and i i just became fascinated and then obsessed and then i never really thought about what i would do with it um but so it was very much an idealistic view of study what you find interesting and study what you love and hopefully it'll all work out you probably know this but some of the earliest geneticists was actually a philosopher by the name of aristotle yes yes he was one of the earlier guys who basically theorized about the theory of genetics how we carry hereditary qualities or attributes in the field of psychology was also born out of philosophy exactly so a lot of common roots and i think it's very interesting and i not only got exp exposed to the science side of it but also the political science i also found quite fascinating okay sounds like we're gonna have a lot to talk about today but but who would have been your your coolest philosopher i i i still to this day believe it's professor dennett i mean no kidding wow urge of computing and and the concept of you know what we would call artificial intelligence today was really what you know as a growing up as a sci-fi geek for me that was that was the coolest thing um on the other hand i would say you know probably most influential philosopher of all time for me would be socrates and and for me it's the fact that you can read the you know the republic which is written by plato but all of socrates's sure teachings of course um and the fact that it felt deeply relevant in the context of our time today oh yeah i think that someone wrote that two thousand years ago and how about two thousand five hundred years ago oh even more amazing so prescient and and and the evolution of political science the evolution of governments and being able to have that level of foresight by understanding fundamental human behaviors and drivers and in the dynamics of a community at different scales and different stages of evolution i found absolutely fascinating yeah that that to me was probably the most mind-blowing you're just like wow how is this text still deeply relevant today yeah that that if you if anybody could be called an oracle i would say you know uh socrates and and and plato these would be that both of them would definitely deserve that that title although i got to qualify the the quality of some democracies that we're seeing today are not as per what some of the founding fathers of democracy would have envisioned including what socrates was envisioning you know almost 2 500 years ago i think we've crossed the line a little bit and we're going to talk a little bit about this later you know in the context of data democratization but i i don't know what what are your views well there was a period of you know a potentially dark period that he also wrote about in the republic of you know one of the downsides of a democracy is a diffusion of responsibility fundamentally and and a lack of civic engagement a lack of civic duty and as a result with this power vacuum the the rise of tyranny the rise of the the strong man of the warlords as you would put it back then or the oligarchs or the religious zealots yeah these are the two sort of factions that you know and beyond that you know in in a few other philosophers since then have very much focused on it uh smith for sure had written quite a lot of this and and i think that's unfortunately what we we are seeing elements of today and and i think the heart of it is comes down to that civic engagement and i think that is a big part of what i hope i hope not only we can we can do something about to to encourage more engagement um amongst not only our communities but but for future generations to come so you know you you seem so into it being part of your end game so i i love that though big supporter of your podcast thank you thank you look i mean you you're interested in genetics philosophy psychology and all those sciences right that you've gone through including artificial intelligence uh how how do you stay focused on what you're supposed to be doing today or you see those different dimensions as being very very supportive and complementary or even enriching of your very focused you know assignment so i i definitely see [Music] the philosophy at the end of the day is my why it challenged me to think of why and who i am and what is this kind of life i want to live and i think the psychology helps me understand not only how to understand how what are the people the drivers overall in society but more importantly if we want to build an organization how to how to create impact not by just yourself but mobilizing mobilizing a team in the beginning to a tribe to maybe at some point even what it would be would call in terms of a company size a nation-state size of a company and i think understanding organizational dynamics is and and psychology specifically on organizational behavior is really just an extension of psychology and social psychology is extremely critical to being able to drive a certain direction through the right types of frameworks of values and i think that's where the psychology piece comes in um the artificial intelligence honestly i'm not i'm more of a fan than i am uh i would say uh you know an expert in the area i luckily have team members who are experts in the area and and are much deeper on cryptography and machine learning and that's that's something that for me it's find the right people but ultimately my job is to to build the team so i think this in a very surprising way i think philosophy and psychology has taught me a lot about leadership and an organization and ultimately then leadership starts with being authentic with yourself oh yeah no no disagreement and and we're hearing more and more as of late about how some of the coolest ceos you know put a lot of emphasis on empathy and and i think empathy is is a thick part of of the psychology of team building managing whatever it is you mentioned nation states you know companies and all that you know and the companies could be in social enterprise public enterprise or even you know social enterprise all right you you were thrown into the kartuku situation right with the sole mission of repurposing and turning it around into into a much better company which you succeeded after a few years you checked out in 2015 did you begin that mission with all that stuff that you mentioned you know fusing the psychology the philosophy the science and all that stuff so honestly no honestly um what happened was katuku was actually founded before me and we found it as a debit card network um it was aimed to be a nets of indonesia if you will right and um and my father was one of the angel ambassadors in there and uh and frankly it was a last-ditch attempt on a sinking ship to see if anything could be done if anything could be salvaged i just graduated college and he gave me this chance and i was always fascinated by the the business model of building up payment networks i i found it incredibly fascinating i was very obsessed with networks in general and actually initially was more about proliferating education via uh you know by virtual classrooms and sort of a hybrid model but that's maybe for another day yeah i was very obsessed with the concept of networks and that was so this was just a financial network it was it was a niche network if you will um and specifically a payment network so it was within my sort of area of deep interest um but frankly i just graduated and i knew nothing and it was uh it was get thrown in the deep end and see if you sink or swim and uh and i realized it was a very daunting exercise um but i worked hard and i googled and wikipedia a lot i had to learn on the fly and uh and i think you know with all things ultimately it comes down to motivation and the why and i was very motivated to hey i love this business and i was thrilled at the opportunity to be leading a company at at the age of 22. um i mean that is just unheard of and of course it doesn't make sense if that company is well run i mean who would let a 22 year old run a a well-run company it's only the defunct ones that you know you get thrown in as a last-ditch effort um but i realized you know it was i i was very scared um i but it was almost a position of what do i have to lose i have nothing to lose and what i sort of live by the mantra of what i lack in experience i will make up for an energy and it was just sheer brute force [Laughter] sheer brute force share hours i was working about 100 hours a week back then okay and just poured in the time and it was an obsession it was an obsession to pass one of the these almost impossible you know uh tasks but i was determined that at least i'll put in everything and if it doesn't work out i know that in the end i'll i'll i'll be okay with knowing that i really gave it my shot and and and at least i can tell my father hey at least i i'm giving i'm paying you back somehow here for all the the decades of generosity and here i'm giving back to you and don't say that i haven't come back to help no that that statement is going to be an inspiration for a lot of people out there yeah and you know i at the time i felt i was quite mixed about it but at the same time i did feel a duty uh i was not forced or compelled and in fact it made it harder if my father had told me in a forceful way that i had to come back i probably wouldn't have but he made it it's so inviting that it was my choice when in reality it was pure inception and uh it's called parental creativity i'm gonna have to learn but yeah uh after one year got the company to break even and then could start breathing and then could start being creative just worked hard and figure out cash flows there was it was pure it was a pure numbers game and kicking every tire and and and figure out what what was monetizing how to deploy the assets we had to generate cash and how to cut the ones that didn't and it just had to be just really really forceful and and get it done make it happen and that was the year that actually was one of the most painful years of my career but one of the most rewarding because there was a year i realized i could do a lot more than i thought i could that would have been how many years after you checked in that was one year wow you you got it to a break even situation in one year one year and you felt pretty good right about the future i felt pretty amazing and and uh it was super scrappy i had to do a lot myself and and i think uh clean up a lot of messes but hey it came down to just having to be take a ruthless view on the numbers and and just and a lot of clients who you know potentially had lost faith and heard that cartography and i was like oh very hard to hear that it was very heartbreaking but just saying well we're here now and i'd love to you know prove it to you that i can do it differently and and uh if you give me a bit of trust i will prove it and i think that's it was a sheer brute force and i think that's the beauty of being 22 [Laughter] well you've grown and aged since then unfortunately i don't have that same level of energy now as i did i did before um but yeah that's when it we started saying okay now we're we're afloat and then i called up some of my uh i thought who the smartest people i know and and and two close uh friends or like brothers to me uh from boarding school uh we dreamt of building up a startup in a garage and built this network and i called the woman but i said hey guys well i've i've got a garage and i've got a company got a startup and we're building a network so why not come on down and let's see how it runs and next thing you know it was uh it was a 14 year uh well well here i am about 15 years later but we ran that for i ran that for about uh as a ceo uh until uh 2015.

early 2016 actually so ran it for 10 years uh as ceo and then uh stepped up then stepped back to be chairman which is actually when i felt i really became ceo and i realized that i letting go is i had not let go enough and uh and uh and and then in 2018 we exited together yeah a lot of people don't know that you laid the foundation for what is today known as gopay right what what made you want to check out i think uh you know we on on and and kudos to the gojek team i think right amazing job of scaling and blitz scaling and probably the example of blitz scaling in indonesia in arguably southeast asia they did an amazing job in terms of growing and kudos to nadine and andre and kevin i mean they've done a phenomenal job there um i think for me it was it wasn't so clear actually i think what what i wanted to do is i needed to make it clear that you know as we went through an acquisition process that the things my fiduciary responsibility to the company came first and foremost that i was representing the interests of cartography right shareholders so i wanted to make sure that that was clean and clear first so until an acquisition was completed i told the guys i said hey you know and i know i have confidence that gopay is going to be going to uh huge heights and and and definitely helped with uh the team and in sort of figuring out some of the early strategy um and how and now of course who could be a part of it but at that point in time as well i also looked at you know where where things were going and and as as big of a rock in a rocket ship that they have over there i i also had my sights on on something on financial inclusion that i had been working on these branches banking initiatives that were quite a different flavor as much as yes gopay is driving financial inclusion i i was really looking at an infrastructure player and i was quite uh obsessed with biometrics actually we had started playing around with biometrics since 2007 um and and and from there uh some microfinance solutions that we ran out with some branches banking teller solutions where they could bring a fingerprint device into the white market to serve smes and really this underserved segment and and i think that that felt like an unfulfilled mission to me because we had we had done you know uh some successful projects with some some microfinance institutions we had done some successful projects uh even on doing uh social welfare distribution or or bansos bantu um but it never hit the scale that i wanted it to or expected it to we managed to reach to you know a few million end users but in the context of 50 70 million unbanked and even more 100 plus million underbanked he just felt that it wasn't enough and and and to me i got inspired along the way by some of the work that was done in india uh specifically with athar and i saw how this biometric digital identity this unique identity was harnessed to over almost eclipse in in a in in the span of just less than five years to generate more than 300 million accounts for unbanked and deliver social welfare to that many people so rapidly and and that was inspirational because sort of the model we had been using before with these terminals there was a company also in india a company called fino which is also a big early inspiration for us um they managed to bank 30 million people in india 40 million if i'm mistaken up to 50 million using 20 000 agents so we had this agent model that we had been pursuing but then when i saw these numbers and we looked at it i thought there's a much more scalable approach and and that idea kept nagging at me whereas i kept thought thinking about hey the gopai team has some incredible leadership you know it was a few payment companies a few friends who i really respect a lot uh fantastic leaders and i looked at it and i said how much more of an impact am i gonna make being over there as much as it's an exciting role there's a huge amount of resources that could be under our disposal versus solving some fundamental infrastructure problems which at the end of the day cartooku was really solving some fundamental infrastructure problems and it was the theme of shared infrastructure and open networks was always there and this was almost just the next generation of that which is very different from this b2c world right of and that's where i thought that i just frankly just had unfinished business and and had amazing opportunities through the fintech association i think while i was trying to let go and and do some succession i had to keep myself busy so friends had signed me up to to try and help build the fintech association which is now affect or yeah yeah yeah or you're you're the co-founder of that association co-founders and you're still a chair still chair but i hope to uh pass the baton over soon to uh to some friends or to some new blood for sure i think it's it's it's due time um but yeah i think we we also managed to do quite a lot there and and frankly my motivation was to try and push an agenda of interoperability and infrastructure interoperability specifically in payment networks back then but it turned out that everybody else and a lot more of the b2c companies wanted to push an agenda of kyc and and yeah kyc digital signatures and that was because that was affecting their customer conversion so yeah sort of made a pact to say okay this is these are the most important agenda items let's let's band together let's create a list of agenda items that we all believe in and we all get behind all of you know these priorities together and we move together hang on i want to i want to pause a bit uh take you back to the cartooku situation i mean it gopay has done a kick-ass job right but but i smell and correct me if i'm wrong a bit of a fatigue within you at that time now i'm just asking with the benefit of hindsight if you had state you think you would have done or could have done a better job until today with that platform as compared to what gopay would have done i think what they've done has been phenomenal yeah i i'm not questioning that but if you had state you think you could have brought it to a higher level i'm not entirely sure i'm not entirely sure and i think i think the way that i work best is is perhaps in a smaller team environment got it and and i think that has would have given me i mean today where i am i think i'm optimized for my creativity um whereas i think with with the golpe team there's a lot of variables and a lot of teams to manage and a lot of coordination i think it's very challenging um it's very challenging to align especially uh it was actually a merger of four companies four payments i mean three payments companies and gojek all at the same time so you know i think some of those achievements have been fantastic and i'm not sure if i would have been the best person to handle some of those challenges um and frankly i had been doing cartooku i've been in kartoku for 12 years and and that's why i said fatigue could that have been a factor yeah i think part of it was i never had a blank canvas okay got it and i think there was parts of where cartooku had gone to that had its limitations in the business model it was quite uh physical asset heavy a lot of cat-backs a lot of physical devices i think we did a great job in terms of deploying and offline but building out all of that physically is is quite challenging we had to support 156 cities logistically in terms of support rolling out to every alpha mart across the country was a logistical nightmare so i think some of that was was definitely where i felt that it had its limitations and as much as in definitely the future for me it was much more about the you know the the bits over the atoms and software and i felt that you know we because of how much that we had already done in the history of the company it was not as easy to move on to some of the next generation um and there was a lot packed in under one company and i felt that at one point one of the big mistakes i'd made was not accounting for the amount of management overhead and founder mentality needed to get something off the ground and trying to in the end spread a management team and founders too thin so i had thought about in the concept of entrepreneurship i said oh it's like a startup it's just in within one umbrella but frankly it doesn't i it didn't really work the way i had planned and i think the number one x factor that was missing was the sheer amount of founder attention and focus and i couldn't focus on those areas as much as i wanted to because the cash flows were coming from other business lines right and and i think that's some of the areas that it was some of the biggest mistakes trying to do too much and realizing hey there is no making it like a startup if i want to do it seriously just create another startup and i think that's the sort of aha moment once actually on the exit i i really just wanted to take a break i wanted to take a bit of a sabbatical to be honest um but i was pretty deep in policy work uh at aftac that especially around some of the things that we were very much committed to delivering on kyc and digital signatures which thanks to chief rudyandtara and coming 14 they really got it across the line um especially around digital signatures and certificate authority i mean it really really salute to them to to championing you know some of the the latest infrastructure that we we can take advantage of today um to take us to the next level of a digital economy in general so actually i was at that point and and it was at a crossroads of seeing you know the birth of a new industry and and wanting to have taken a break but then seeing that this this actually could fulfill a an unfulfilled mission so so how long of a break did you take two days six months and i was tempted to take a much longer break but that's pretty damn good to be able to take six months it was the first time i mean if if those ideas are like burning in your head right it'd be tough man to disengage so i'm glad i had the break i definitely did it i definitely still believe i i could have taken a longer break but [Laughter] when opportunity comes and opportunity strikes i think that's the point where i said hey this is something i've talked about a lot this is something that i said is very much core to my personal mission and here's the opportunity am i not going to walk the talk so as much as you know i don't think timing will ever be perfect you're not gonna have your cake and eat it too so i said okay let's go for round two and which is why you got the number two on your t-shirt is that it two years so this is oh okay okay i thought i thought two means your second company is a second um so that's i've only had two companies my entire career this is the second one i wouldn't complain about it you've done okay man yeah and and you know i think having the a free hand this time uh you know and i i and i don't regret what has been done i think uh at 22 i would you give me a blank canvas i wouldn't know what to do um but now i i don't even recall what i knew when i was 22. [Laughter] but yeah finally i kind of had my own clean slate and the ability to really put this put a vision a mission a team and and and have the why and the how clear from the beginning not so much to what i think the what was clear but more importantly is the why and the how um let's peel the onion about the why and how so when i look back at kraktoku especially when i was on my sabbatical i finally did some solo travel which made me feel like i wasn't you know just graduated from college i was always envious of my friends who you know in between jobs got to travel got to go here and there gotta move and live in another country and and and i felt i i never had i missed out on some of that so there was definitely some fomo but once i traveled and was doing the things that i thought i had missed out i ended up spending a lot of time uh in introspection and just actually almost peeling the philosophy onion back again and and reading some of my uh you know reading some of my favorite philosophers and having that down time and and asking myself the very hard questions again you know and and even harder now because okay there is you know you can have a lot of lofty goals and say okay no i want my financial freedom first i need to have my my tools i need to get my tools and my tool kit ready first um but then when it's there and the set of experience then the question became clearly well there's a lot of things i can do right now or there's a lot of nothing i can do as well [Laughter] and don't get me wrong it was very tempting to go and move to bali and uh and enjoy the sun every day uh and live a more carefree life for a period of time at least but i think this this quest for inclusion just kept being in the back of my mind of constantly nagging and it is being able to drive financial inclusion through branches banking through you know latest generation identity technology whether it's biometrics fingerprints back then to then facial recognition now right i just saw there was a perfect storm of convergence of technology that was happening and and i was in a position to try and do something about it and it became in after working on the policy front and collaborating with a lot of brilliant folks at the world bank they have a special unit called identity for development and uh and it was very much linked to the sustainable development goals and it opened up my eyes that identity you know biometrics it's not just about financial inclusion but it could lead to access to education it could lead to access to healthcare and fundamentally give that basic foundation for people to live their life's potential and and this me this digital leapfrog in technology could really proliferate access and at the same time if not done well could actually leave a big digital divide so to me it was the same calling in a different form and in inventing the vision grew much much much bigger [Laughter] and almost to the point where saying am i am i absolutely insane for trying to do something like this but and you know i was tempted to even consider a career path into the venture capital world where could be supporting entrepreneurs and and go from you know sort of narrow and deep to sort of that helicopter view of being able to get all the intellectual stimulation of working with a bunch of entrepreneurs i also found that really exciting but i just felt that i you know this wasn't i just hadn't given it my all yet and and i thought that if i don't do it now i don't think i'll ever do it you know i thought i know that how much energy and sweat blood and tears goes into a startup this time i'm not so blind to that i was very cognizant and and a five-year commitment isn't gonna cut it you know it has to be at least 10 years in the question for me am i what do i want to dedicate 10 years of my life to what do i want to commit 10 years of my life to how about 25 years no no this is this is how i look at you right i mean your early stage would have been really taking financial inclusiveness from a low level to a higher if not much higher level box checked you've squared the circle stage 2 would be i don't know if you want to call it regulating the financial inclusion dimension or even embellishing it even further by way of this biometric you know capabilities i mean you want to make sure that people that are actually being included financially are the right kind of guys right yeah but but i think it it also is an enabler right of those that would have been disabled or unable and and i i see that more as an augmentation as opposed to a regulation and and i think it is contiguous and continuous from your early stage of financial inclusion play 100 and and the proudest achievements for me when i look back at cartooku as much as you know we rolled out an innovative sort of unified payment processing model with car 4 and mcdonald's and we had 23 financial institutions we had bang bang bang citibank has clients and we're very proud of that but actually the most proud moment for me was working with uh bankai and being able to roll out bandsaws yeah those who really needed it and and it was a lot more emotional and i think those were the the tear-jerking moments that the end of the day i felt were a lot more meaningful and and and still unsolved and still unsolved in a at the large scale in the grand scheme of things so and then being able to look at other countries that that did effectively solve it and and that's where and you can't say india it doesn't have the same infrastructure challenges in india we we share a lot of infrastructure challenges i i lived there for three years so i know i lived in india for three years so look uh i got lots of questions popping up in my head but i want to drill on this if we take a look at the payments in china okay last year it was at a staggering 26 trillion dollars which is double the gdp of china right i mean if we use that as a as a benchmark i mean that's the kind of potential the 2x of gdp is the kind of potential that we're likely to see you know in payments in a country like indonesia that's hugely domestically consumptive right and that's pretty staggering man if if we can anticipate payments amounting to [Music] two trillion dollars which is 2x of our gdp and we're we're nowhere near that and and i think it it it only underlines the importance with which we want to make sure that the right guy gets to be included financially the more you can play role with your second act of veda what do you think well i and i think that's where now i think that the question of growth of whether or not adoption is going to be there is no longer a question right everyone clearly sees and believes it whereas once upon a time it was a concept i mean i remember in 2006 people were talking about mobile money already yeah long time to finally take off but now there's more e-money subscribers than there are mobile phone subscribers in indonesia so the critical mass has hit and and and as you pointed out i think there's still a long way to go because the real enemy is not other e-money but it's cap right it's the conversion of cash and there's still a long way to go but at the same time i think today the the concern is not about growth but it's about the risk of risk of as this grows to be a bigger and bigger pie how do you make sure that it's sustainable and how do you make sure and at that core of it i believe is is trust yep how do you ensure that the actors in this ecosystem that the are are the integrity of these actions are maintained and that the trust in the system is preserved and i think that's where the the you know part of it is definitely you know learned from from my background in payments but it's definitely gone further and it's much deeper into information security and cyber security and and today the biggest issue in trust is frankly there are account takeovers by by fraudsters by cyber criminals that literally managed to do some not even that sophisticated social engineering attack so getting an otp and taking over your account and stealing you know people's hard-earned money so i think that's the challenge today is especially with actually the pandemic i mean the the rate of digitization has just gone it's just skyrocketing yeah the challenge today is come with that comes the threats of digitization and even prior to the pandemic the world economic forum had listed the the top 10 risks over the next 10 years in in economic growth globally was about cyber security cyber cyber yeah fast and account takeovers those are two of the biggest issues and i just read an interesting statistic that 85 to 90 of login attempts on e-commerce sites are using stolen credentials 80 no kidding 90 no kidding the amount of and and when we look at it is that globally or locally wow okay so when i when i look at some of these issues and and ultimately i look at some of the learn some of the lessons learned from cartooku which you know there was a lot of hardware involved which had its pain points of physically moving things around it was very painful but from a security point of view when with hardware-backed security we we luckily and you know didn't have ever a security breach we never had a breach and it came down to the architecture it came down to i think today's design of the internet was driven by you know resilience of a communication network right and i think it was designed off the initially off the premise of being able to preserve communications in wartime events right of if you knock out a communication tower that all the communications will go down and and it's distributed communication so you want to accept communications from as many places as possible and and that was understood i think what ended up happening somewhere along the way is that the network was a trust everything model whereas i think the evolution of where it needs to go today especially in financial networks in in networks that need affected is it needs to go towards a zero trust model sure that before you're allowed in you better prove that hey you're you're someone that's legitimate yeah and has in your authorized access before you can walk in that door and even then there should probably be a series of doors not just a single door and and it shouldn't just be an open field where everyone can can gather but a little bit more of the medieval times of let's build the mode let's build the drawbridge let's build multiple layers of walls and that's good defense it's not about a single layer of defense it's about building multiple layers of defense and i think the concept of zero trust and defense and depth is gaining a lot of traction and it's these are not new concepts but i think the the threats have hit a critical mass to the point where the demand and the need for more sophisticated cyber security solutions is now here and you know there's there's a lot of companies globally speaking that don't have the necessary chief worry officers right and and you know even if there was one i'm not so sure if cyber is on top of the list on many of these accounts or companies right and on one hand it presents a real challenge i think on the other it presents a ton of opportunities for your play right and and i'm just curious and i want to go deeper now into vida how are you positioning vida vis-a-vis some of the others that are you know in this dimension i know i think you raise a really fair challenge is that understanding security let alone selling security and convincing someone to buy security is difficult even in the physical world usually something has to happen really badly first and then people buy security so i think security is something that is always a challenge and it's always this cat and mouse game i think the way we saw it is how do we not position this entirely about security how do we think about some of the fundamental problems that necessitate good security but the problem is more about onboarding a customer and customer acquisition if you talk to a business owner and say hey i'm going to improve the amount of conversion you get of how much traffic you get walking the door to how many actually become your customer and paying customers that's a different story everybody can relate to the revenue side of things right and and you know and there's an operational piece of cost cutting that is but definitely more top of mind now and as as many industries are are in in tough places and have to tighten up the belt and i think those are also valued but for us and and and frankly it's almost a bit of a perfect storm with the work from home and now having the workforce in adopt digital means but i think from us it was it was actually the way i saw it and the way i had approached this was by trying to solve an industry problem first and the industry problem arose at the fintech association it was about kyc it was about hey i don't if i'm doing a fully digital service asking someone to go meet me face to face is just gonna it's gonna kill my conversion and and that was really the the basis of it that there was a clear commercial justification and the clear cost of even if you send an agent even if you send let's say a gojek driver there's still costs to that logistics you know that's already a lot more efficient now than it used to be but that was you know and how do we resolve this and when we think about it when you go into a bank branch what do they do right they ask you for your id card they eyeball the photo on the id card and they eyeball you and say okay this person looks yeah this is pretty good yeah pretty good pretty good or they'll make a joke that hmm used to be a lot skinnier huh but you know beyond that i would say then the next thing they say okay well here's the terms and conditions to being our customer do you agree and you say oh yeah i agree and you sign you use a pen and you sign and that wet signature is an artifact of your consent that i agree to the terms and conditions that you present me to providing your service your financial service now i think these two points have always required to be done in person because it is important that it's done properly it's important that we we manage the risk and increasing risk around money laundering around terrorism financing around you know whether or not somebody was appropriately informed and is this legally you know valid because you need to have you know it should be done you know with with a certain level of information should be transparent so as we progress along these issues actually mine i wasn't even planning a startup to be honest it was just about okay how do i help you know here and work on a few policy fronts and and bring the community hopefully together and a united front and and and selfishly i wanted to push my payment interoperability [Laughter] so it was it was something there that in the end i realized that this is actually a really big problem um especially if we are facing businesses and and that's where the solution necessitates good security because you need a digital signature but what is a digital signature and if you need to verify someone's identity how do you do that effectively remotely so the product requires strong levels of security and technology before the legal assurance levels can be met and thankfully there is global standards and thankfully we have a very you know supportive and progressive uh regulators and and and ministries that could actually push some of this next generation policy into place that allowed for this next generation technology to be leveraged so and and i think it was just that perfect storm so yeah yeah it's a combination of you know compliance technology threats evolution uh and and at the end of the day uh you know the industry wanting to adopt the sort of the next wave to fundamentally remove friction and and drive more adoption now philosophically uh do you believe that we ought to embrace a gdpr kind of concept here or more of a liberal you know type of embrace like what we're seeing in the u.s i think the principles of gdpr are extremely good i think it comes down to is implementation okay and i think the tension is the belief that if we implement gdpr that data is going to stop flowing and if data stops flowing then the digital economy stops flying and i think that is the delicate balance that needs to be achieved and this is where we don't believe that these things are mutually exclusive the same way that there was always a paradigm in the past of the more secure you make something the less user-friendly it is right or the more user-friendly then you sacrifice security and there's always a trade-off and i don't think it is a trade-off i think you think about new architectures sure um and i think this is where with gdpr i believe we're at a stage now that we have the technology that can allow for transparency that can allow for consent uh and and make it clear that the accountability of that consent not only on the the person or the business or the relying party using the data leverages it for the intended purpose and only limits it to those purposes that have been declared but also that the end user is held accountable that yes they did consent so don't don't backtrack on saying you didn't consent now at the same time allowing for flexibility that sometimes people make mistakes and one of the basic things of the right to be forgotten this is something that's quite difficult to implement but with the latest i think at the basis of this i think it's really about consent before i go into any other areas and if we think about back to the analogy of what is the artifact of consent and if i go to a bank branch how do i demonstrate that i do consent to the terms and conditions it's a wet signature and now you can leverage a digital signature so the proliferation of digital signatures i believe can assist can help in some of this implementation but it's it's almost an inevitability right yes and i think that it's important right i think data privacy and consent is now very top of mind right i think yeah there have been areas of big data breaches there have been areas of personal information being shared to third parties that you know at some point could you know influence an election or on another side you know be used to you know uh target market you in ways that you can influencing elections results are not uniquely in developing economies or countries they've happened in more developed economies or countries so i think there are these genuine fears because we have seen these genuine risks and and i think it's only a matter of time that we do have to act and and and just ensure that again not to stop data from flowing data needs to flow but make sure that the reasons of how it's getting used what it's getting used for are clear and that someone agrees i don't you know if you say am i okay with sharing my location data is not a clear yes or no right if i'm just on a you know unknowingly walking around maybe not but if i'm trying to find a place and i want to use google maps to find that place and help me navigate yes by all means use my location data otherwise how am i going to get there right so it depends a lot on contacts and i think that's what ultimately you know um we need the technology to assist i think we're at a point now that there's a lot of there's a lot of startups also working in the space on privacy related tech that that can help us get there quickly i think you know early days of gdpr implementation in europe you know check into hotel and now this you know now the the receptionist can no longer scan my passport they can't photocopy my passport so the poor guy has to handwrite every you know only the limited data allowed and and as a result i'm there waiting for him to handwrite every single detail and and you know a bunch of people behind me so i think if it's not implemented well it can slow things down and that is something we need to be cautious but if you deploy the right tools we can have the best of both worlds there's there's this theory or argument that you know the the europeans tend to be a little bit more strict with their gdpr concept because they're not beneficiary of the tech space as big as perhaps the united states would have been in terms of job creation in terms of monetization and all that good stuff so would you or i could argue that it's it's economically driven it's not data security driven i think there is definitely a lot of truth to that at the same time i think the level of breaches are at scale and and the consequences of those breaches are reaching new heights today than they ever did before whereas in the united states i think it's only a growing level of concern over data privacy even in the valley right even in california especially in california in fact where arguably they've harnessed the art you know probably some of the the greatest wealth creation um from that but there is now i mean they are very much most the one of the highest levels of concern in the united states is coming from california and it's coming by directly so i think it you know just like any sort of level of innovation it tends to be a pendulum swing one way and then yeah to the other yeah we're starting to see it swing back to this other area of concern and and hopefully it doesn't swing too far that things stop right and i think that's something that we want to be conscious of am i okay with sharing my address the questions for why if i ordered something online yeah of course you better send the logistics guy my address otherwise the package is never gonna reach me right um so and just making sure that okay the person that needs to know that information for that reason it's fine yeah but let's make sure it doesn't just go up to you know uh to anyone who who decides it or someone who wants to pay for that information can get it and use it for you know a lot of potentially malicious motivations yeah that's and i think that's the concern right and i i think we are in a day today where you know controlling information transmission is almost impossible and you know from an information security data security point of view the answer is encryption the answer is crypto and just encrypted and you don't have and the the key no pun intended is actually who stores the key sure and how do you hold the key sure these keys can be effectively given to each individual advantage in an easy enough way and you don't have to think about all the the you know the tech behind it but if they can be effectively controlling that access a lot more effectively and that clicking a button yes i agree i agree can only be clicked by me and not someone else i think we can find that solution you just got to be able to check off the boxes right on measurability accountability and responsibility in terms of who gets to hold the key right but going back to the earlier point it's just very tempting to hypothesize that at the rate that places like indonesia or southeast asia are going to be great beneficiary of the tech you know movement in terms of job creation and monetization i'm willing to bet if not hypothesize that the policy posturing is going to be less restrictive than the count of gdpr that we're seeing in europe for the time being and as you suggested there is going to be this pendulum swinging from one end to the other incrementally or substantially depending on i think the economics of things right but but you got to draw the line very very carefully and create the necessary balance between data security and the economics well and i think this is going back to i completely agree you need economics you need the market forces to drive these behaviors and i think very simply put if consumers care and businesses say the same way that how do you store my money are you doing this in uh in you know under your mattress or are you doing this in a vault and if you show me a vault i'm like hey i trust this guy who has a vault that versus the other guy who's putting it under his mattress and ultimately i think the more progressive businesses have an opportunity to develop a higher level of trust with their consumers and understandable it is an investment it is take some change but i do believe that the ones that make that change earlier can preserve their trust with their customers and the credibility and if you're playing the long game i think that's that's where the difference will show right in the same way that you know there was hundreds of banks in indonesia before right and now why would one person choose one bank over the other and it comes down to trust it comes down to hey you know a year from now if there's a financial crisis is am i just all my money just gonna disappear into thin air right and and obviously you need regulations and there's other you know checks and balances that have been developed to try and make the industry you know uh make sure that consumers stay protected but ultimately i think the onus is on industry and if the industry takes the long view and is able to take the long view i think those players will be rewarded especially seen as hey this is transparent this is fair i get it i understand does it mean i have to read a legal document no just show me what data i need to share and what you're using it for and we're good i don't need to read a bunch of legal jargon i want to have the option to and i want to make sure that you're held accountable to all that legal jargon that you put in these agreements and then hopefully regulators make sure that that legal jargon is okay yeah but ultimately you know is your average consumer gonna end up reading the fine print maybe not but i would appreciate it just the way today if i'm gonna be installing an app there are permissions and it says hey would you like to grant this app you know your location information all the time only while you're using the app there's easy ways to communicate and provide this transparency and it's already being done by google by apple and there are user-friendly ways to achieve that so again i don't think that this is uh rocket science right i think the solutions are there the question is is the will there and if consumers care and are more demanding or if somebody is willing to put a bet that they will care yeah and people gravitate towards that then i think that you know there will be a natural evolution in the industry and and the ability to take the long view and and unfortunately even in in some developed economies some of the large players are still not able to take the long view and that that i think is a mockery it's not a very good example for countries like indonesia where i think we need to get more and more industry players to be able to take the long view hey uh hopefully entrepreneurship and startups all right as disruptive as they can be and it helps keep the whole industry on their toes and you know i can understand changing legacy can be very costly and that's where hopefully fresh blood from fresh entrepreneurs can help solve these problems in new ways and and hopefully move us along all right now you know this dichotomy between what's happening in the entrepreneurial space and in the policy making space we know it you know we know that the policy making space is not being compensated as well as the entrepreneurial space right and as a result of which we have seen and we're likely to see continuing linearity of progress on a policy site vis-a-vis the exponential you know progress on entrepreneurial if not private space how do we fix this you know imbalance or dichotomy i think it comes back to the long view and i think that it's not about a you know obviously education socialization getting regulators and up to speed is going to help but i think ultimately it's it's about the industry itself and the industry at least key players banding together to take the long view that they want to preserve trust and in in things like fintech in things like cyber security that's the currency of your business yeah and you you it would be foolish to neglect it right and i think sometimes it does take a few incidents to happen uh and and and it may not happen to you directly because you're you know you you yourself have been looking after your interest you're doing it well for your own company you're implementing the right you know uh risk mitigation uh you know policies internally and you're deploying the right you know investments to make sure that you can manage the risks but sometimes you know somebody else out there a cowboy can can blow up and and the ripple effects the shock waves you realize after a while will hit you even hurts everybody hurts everybody and that's where i think at a certain level of industry maturity at least i would hope and i think this is the beauty of what happened that at affect at the fintech association we decided hey guys we got to work together we got to work together we can help come up with the right kind of policy recommendations and help shine the light on how other countries do it what our global industry standards what we can implement and what effectively as an industry our de facto standards we're all following anyway and how do we just make this all more efficient and how do we all take our part let's not expect the government to do everything let's in fact take this opportunity to help and in the end help ourselves but again you take the long view and and doing it on your own i think is is very costly and very expensive and very time consuming you know who you're researching on white papers and benchmarking but if you band together and pool our expertise together and we pool our resources in the private sector together we can come up with very effective policy recommendations and as long as it's been done professionally and we have it vetted by independent management consultants who benchmark other views in other countries and give it you know we say hey you do your own research this is our thesis this is what we believe you can challenge it you can you know bring up all the the good bad and the ugly of what we're saying but please give a fair and professional view and i think once we manage to do some of that heavy lifting of homework and i think by when we say cyber security what does it mean right if we say okay we need to improve authentication okay are there standards yes there are global standards to all of this and let's pull out those frameworks we don't need to reinvent the wheel and let's help guide that along and present the facts as fairly and as clearly as possible to make the decision-making process of policymakers a lot easier and yeah as as a devil's advocate would would you agree to the notion that such body that would be responsible for making the policy recommendations ought to be as inclusive as possible as to include non-industry players as to reduce the bias of policy recommendations you you may want to include academicians you may want to include i don't know ngos that you think or we all think could be stakeholders in what matters and i think that's that is something that we do and it's something that i firmly believe in is making sure there are independent views yeah that are there but i think at the first and foremost of being able to untangle what the industry needs to unpack growth should come from the industry constituents oh yeah absolutely right aligning the priority of that agenda but then validating and verifying is that agenda a fair agenda and ensuring that there isn't too much bias there will always be bias to make sure that there isn't too much bias and involving you know professional third parties whether it's you know in the from the world of academia we often do uh involve uh for example we work together with quite a few universities that have that are strong uh practitioners and advocates of cyber security to help you know chime in on these cyber security frameworks are these fair enough and both not only uh in indonesia you know respected in institutions academic institutions but also abroad so we try and balance us out we we also are fortunate to get a lot of help at the at the fintech association get a lot of help from

2021-03-18 20:47

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