"Historically, there's no correlation between property demand and interest rates in Indonesia. Usually, you would see a correlation. Interest rates three or four years ago in Indonesia were much higher than they are today. So that's something else that the customers see. Even the fixed interest rates were double digits a few years back, and they have gone significantly down nowadays. So the fixed interest for two, or three years, you can get down to 3, 4% for a limited amount of time, then it goes back to the floating rate of about 12%. For people who grew up in Indonesia and lived here for a long time, they compared it to what it was five years ago. That's another psychological factor that doesn't slow the demand." - Ilya Kravtsov
"When we were in the process of selling our Indonesia operations, I had my first baby so I didn’t know what to expect. I spent a few months reading it just to get my head around what it’s like being a dad. We were also still doing a lot of research because when you start a company, or your third company, before jumping into anything, you really have to do proper research and look at things a little bit differently. You try to control your enthusiasm for starting something new because it's going to be a long and challenging journey. Do research and find the right partners to kick off the business. That was how I transitioned from my second business to my third business. I was enjoying time with my daughter while working on deep research and going into detail of what are the problems that I can help solve in Indonesia." - Ilya Kravtsov
"When we started, everybody was saying banks are too traditional in Indonesia, but in reality, it's not true. The banks really give more mortgages and want to lend more. They're not as traditional as we think. What naturally happens is that a lot of the origination of mortgages is still done in a traditional way, mainly paper-based applications, involving a whole chain of resources. What happens is that if you do originate mortgages in a more traditional way, you would always prioritize houses that are more expensive to make your economics work, and deprioritize the houses that are cheaper, where you will get less interest rates and will be more difficult to pay your costs. So we've been observing and there was a whole opportunity that was not unlocked because of a lack of efficiency, high costs, and originating mortgages. Our fundamental assumption at the beginning was if we can digitize the process, decrease the cost of origination, and unlock a portion of the market that traditionally would just be ignored, not because the banks don't want to take it, it's just they would have too many applications and they would prioritize the ones that are better for them financially. That was what we came across as an assumption and that’s where we kicked off." - Ilya Kravtsov
In this episode, Jeremy Au speaks on the Indonesia property market, cultural assimilation, and navigating startup transitions.
Keywords: Indonesia Property Market, Cultural Assimilation, Navigating Startup Transitions, Indonesia, Founder Story
