Indonesian Youth Entrepreneurship Landscape

As the fourth most populous country in the world with 270 million people and the largest economy in Southeast Asia, Indonesia has vast potential to develop its entrepreneurial ecosystem and support business growth. The emergence of active angel investors, impact investing, host of local and international accelerators and incubators, among other supporting factors, have propelled the creation of 2,100+ startups in the country. Indonesia is also home to more than 11 unicorns, and opportunities for startups continue to arise. 

At the same time, young people dominate the unemployed population in Indonesia: three-quarters of unemployed people were youth in 2019 and the level of youth unemployment increased from 13.03 percent to 15.23 percent between August 2019 and August 2020. With the country’s demographic dividend and a high volume of public consumption, youth entrepreneurship has the potential to mitigate youth unemployment, build robust and inclusive economic growth and enable young people to drive sustainable development. 

The Indonesian Youth Entrepreneurship Landscape was developed as part of the State of the Ecosystem for Youth Entrepreneurship in Indonesia research commissioned by the Youth Co:Lab initiative co-led by UNDP and Citi Foundation and the Islamic Development Bank in 2021. The research reflects on a range of enterprises, from self-employed and MSMEs, to startups and social enterprises within the formal and informal sectors of the Indonesian economy. It aims to identify entry points for strengthening an enabling environment for youth-led enterprises in the country to amplify the positive impacts of youth entrepreneurship. 

The Entrepreneurship Landscape serves as a tool to help operationalise recommendations provided in the research and visualise the entrepreneurship ecosystem, which consists of various stakeholders including but not limited to development partners, entrepreneurs, financial sector institutions, investors and venture capital firms, non-governmental organisations and local and national governments. The online map is based on the analysis conducted as part of the study and it is being updated by UNDP. 

The map aims to help understand the roles of different actors and relationships between them, and identify opportunities for collaboration, growth and development within the ecosystem. For example, young entrepreneurs may use the map to learn about capacity building or financing opportunities or identify entry points for collaboration with other ventures. Ecosystem enablers and builders, on the other hand, can use the map to support policy development and understand how the operating environment for youth entrepreneurship can be further strengthened.  

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