Can this e-commerce startup be the Indonesian equivalent of Amazon?

A new e-commerce startup is taking Southeast Asia by storm and may be poised to become the region's equivalent to Amazon.com.

Founded in Jakarta two years ago, Lazada Indonesia has had a less-than-auspicious beginning for a startup company, facing challenges like tropical heat waves that were literally evaporating perfume inventories to conducting a specialized ritual in order to exorcize what was feared by workers to be a haunted warehouse. And while these may not be the typical growing pains of a new startup, the European-born executives of Lazada Indonesia have not only tackled them successfully, but have turned their business into a local marketplace powerhouse.

As The Wall Street Journal (WSJ) notes, Indonesia's e-commerce sector is still in its early stages, so much of the foundation for a company like Lazada Indonesia to exist — let alone thrive — had to be built from scratch first. While this naturally requires an even heavier investment from the company's executives, it's one that has helped the startup get a foot in the door before market giants like Amazon and eBay could.

"Lazada already gets more visitors than any other business-to-consumer site in Indonesia, according to data from research firm SimilarWeb," the WSJ writes. "Lazada's site saw 6.6 million visitors a month, compared with 3.9 million for Alibaba's marketplace website AliExpress.com and 2.2 million for eBay."

Although Lazada does not officially disclose its revenue stream or just how many transactions have been made on its website, this huge volume in traffic coupled with the country's increasingly growing middle class — who are projected to make Indonesia's online shopping market an $8 billion industry, the largest e-commerce sector for Southeast Asia, in only a few years — promises great returns on this particular investment.

Whether you're opening your own startup overseas or here in the U.S., make sure to hire a small business attorney that can effectively represent and protect your interests when necessary.

Categorised in: International Business Law

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