Jakarta. Startup companies which address problems, such as infrastructure, logistics or financial technology, are the most likely to become Indonesia's next billion dollar companies, a panel of investors said in Jakarta on Tuesday (29/11).

The world's fourth most populous nation offers both challenges as well as potential for startup companies seeking to monetize the $860 billion economy. People living in the archipelago nation face various day-to-day problems from traffic jams to poor infrastructure development, resulting in many people in some remote areas facing difficulties in accessing several basic services from telecommunication to banking services.

"There is a lot of optimism about Indonesia's market potential, but again there also a lot of problems in the market," said William Gozali, Investment Manager at MDI Ventures, a Jakarta-based venture capital initiative by Telekomunikasi Indonesia, Indonesia's largest telecommunication company.

William made to comments during the "Closing With Investors" mini panel discussion in Jakarta hosted by Rework, a Jakarta-based co-working space provider. The panel offered advice to startups on fundraising and soft skill development in terms of nurturing relationships with investors.

William, who leads MDI's investment team accelerating venture deals in the region, said some startups may have failed to monetize in Indonesia because of the country's low credit card and formal banking penetration rates.

On the other hand, Southeast Asia's biggest economy offers a growing internet penetration as well as a growing middle income class.

"So behind a problem there is opportunity, so the next $1 billion company is a company that Indonesia's big problems like infrastructure, logistics, or fintech companies that enable other companies to monetize the markets," said William, whose MDI Ventures also has operations in Singapore and Silicon Valley.

In Indonesia, homegrown startup GoJek, which provides transport options and other services in dense Indonesian cities like Jakarta via a motorcycle taxi hailing app, has been able to scale its business quicker than California-based tech giant Uber. Industry analysis shows the firm is now worth more than $1 billion.

Other big startups in Indonesia are dominated by e-commerce platforms, ranging from Tokopedia, MatahariMall to Lazada.

Founders personality top priority for investors

William was joined in the discussion with Moses Lo, founder and chief executive of Xendit — the first Indonesian company to be accepted into YCombinator, the US-seed accelerator known as the world's most power start-up incubator — and David Soukhasing, a director of the Angel Investment Network Indonesia (ANGIN), the first and largest network of angel investors in the country.

The panel identified four key factors investors consider before selecting startups: personality of founders, a strong pitch, market potential and company financial.

Lo and William both agreed the personality of a startup founder is key as it represents the spirit of the company and is the best indicator of how a company will develop its business.

Lo added the pitch, when founders present firms to potential investors, is also important as it gives a "generic sense" of how the founders will develop relationships.

Soukhasing noted language barriers or weak presentation skills could discount this factor, but a strong market potential could  bridge the gap.

Market potentials is also another important aspect to review, as "investors wouldn't want to invest in a shrinking market," Lo said.

The three speakers agreed investors usually understand financial performance may not be good enough while in the early stages, but some "traction" or evidence the company is gaining a market share, such as rising users, transactions or sales, can help investors determine their plans.