Fraud allegations at two high-profile Indonesian startups, aquaculture firm eFishery and fintech lender Investree, have rattled investor confidence, but industry leaders say the country’s startup ecosystem remains promising thanks to its large domestic market, stable growth, and rapid digital adoption.
The most damaging case involves eFishery, once hailed as a model of homegrown innovation. Police allege its founder and former CEO, Gibran Huzaifah, inflated revenues to US$600 million between January and September 2024, when actual earnings were only US$157 million. More than three-quarters of the financial data was reportedly falsified.
Founded in 2013, eFishery had become a darling of Indonesia’s tech scene, achieving unicorn status in early 2023 with backing from global investors including 42X Fund. But after the fraud surfaced, Gibran fled before being arrested by police on 31 July 2025.
Investree, a peer-to-peer lending pioneer founded by Adrian Gunadi, has faced similar scrutiny. Once a flagship player in fintech—Adrian previously chaired the Indonesian Joint Funding Fintech Association (AFPI)—the company is now mired in allegations of mismanagement and financial misconduct.Still Promising
Chairman of the Indonesian Venture Capital and Startup Association (Amvesindo) Eddi Danusaputro said that from a market perspective, Indonesia remains attractive for startups given stable economic growth and widespread technology adoption.
He acknowledged that the alleged eFishery fraud has dented investor sentiment, but stressed it concerns a single startup, not the entire Indonesian ecosystem.
“There are still many startups in Indonesia that run their businesses by the rules—not all are bad actors,” he told SUAR, Monday (11/8/2025).
To keep Indonesia’s startup ecosystem healthy and prevent fraud, investors are advised to conduct background checks on founders. Background checks are important to determine whether a founder has a solid track record and whether they have ever been involved in criminal cases.
He added that many investors in advanced economies already perform background checks on prospective partners, and Indonesia should follow suit.
Indonesia should also establish a dedicated supervisory team for startups. Thus far, oversight has been spread across multiple ministries, making supervision unfocused. Sectors still favored by startups in Indonesia are fintech and logistics, and both are projected to continue growing.
Strengthen Corporate Governance
Rudiantara, Chairman of the Steering Committee of the Indonesia Fintech Society (IFSoc), said Indonesia’s startup investment climate is currently shaky due to a spate of fraud cases in the startup world, such as the eFishery case.
If not handled seriously, this will endanger the development of startups in Indonesia. He urged startup players to build robust business models and sustainable corporate governance so investors will have confidence to invest.
“Corporate governance must be sound from the start; make sure the people at the helm are the right ones so they don’t end up in legal trouble,” he told SUAR, Monday (11/8/2025).
The alleged fraud and embezzlement cases at eFishery and Investree should serve as lessons for the future of startup businesses.
Nailul Huda, Director of Digital Economy at the Center of Economic and Law Studies (CELIOS), said the startup ecosystem needs further improvement, especially in corporate governance and oversight—both at the company level and among investors.
He added that investors also need to change their paradigm in assessing a startup’s progress. Many still emphasize boosting company valuation rather than looking at business sustainability and net profit.
Therefore, a more strategic, sustainability-oriented investment approach is becoming increasingly important in today’s digital startup landscape.