Are Indonesians Entrepreneurial At All?

Entrepreneurship has always been understood as the way in which new economic avenues are opened.

There are three aspects considered as being entrepreneurial: offering something new to the market, becoming a new competitor in an existing market and geographical expansion of an existing business.

When BBC and Globescan announced that Indonesia topped the list of most supporting places for entrepreneurs, beating the United States and Australia, there was a degree of surprise (

The survey captured the perceptions of entrepreneurs and it implied that entrepreneurs in Indonesia felt they were more supported than those in any other country.

Yet, the reality tells a different story.  Recent Global Entrepreneurship Development Institute (GEDI) data tells a different story (  Indonesia is ranked at 120, and entrepreneurs in this country are characterized as being good at opportunity recognition (above the world’s average), but very bad when it comes to growing their enterprises.

This is unlike the US (first place) where American entrepreneurs score high in all indicators of entrepreneurship above the world’s average. Some pundits argue that this is because the government in Indonesia doesn’t provide enough support to leverage our entrepreneurs.

But even if the government provided all the factors to create an enabling environment for entrepreneurship, we would not be like Americans, Australians or Europeans. Why?

The answer, apparently, lies in perceptions of sexual behavior. Scholars on the social and sexual perspective believe that our sexual behavior is not as private as we may think; it is actually public.

Sexual behavior permeates and determines our daily life and it defines our social relationships.

This perspective is at the forefront of those who study families and feminism as a reaction to western discourse that often puts families and private life on the periphery.

As Indonesians in general believe sexual activity is an instrument of reproduction, we tend to focus on the cycle of reproduction, parenting and grand-parenting.

Thus, most of us would think that we have lived the full extent of our life when we can play and enjoy our life together with our children and grandchildren.

To fulfill this, all social institutions (especially informal ones) are created to correspond to our sexual activity cycles. As a result, everything in Indonesia has to be family-friendly.

This may also explain why we, as Indonesians, are more culturally collective and prioritize our families and relatives.

We value social capital — in terms of familial relationships and networks highly.

On the contrary, most of those who embrace Western values tend to believe that sexual activities are mostly recreational and therefore, they may have a stronger sense of individualism and are less family-oriented.

Social institutions are developed to give ample room for individuals to express their individuality.

Individual fairness is viewed as an important, and perhaps the primary, building block in Western societies — not collective family pride or family values.

As a Western-dominated narrative, the story of entrepreneurship is always about the story of individual struggles and autonomy — a story of an economic hero in the making.

It has always been a story of individuals creating products and services to capture value for themselves in the form of profit.

The entrepreneurial success messages from the likes of Steve Jobs, Mark Zuckerberg and Bill Gates are always about the high risk-takers, their persistent tenacity and their highly competitive behavior.

Most Indonesians don’t fight for their individuality. They struggle for their family’s well-being. And this may be why we don’t look entrepreneurial from a conventional vantage point.

We may mean entrepreneurship differently.

Perhaps most Indonesians seem to think that being entrepreneurial means putting social capital over financial capital.

How many of us hear the classic stories of bright young inventors from the villages who can’t strike a deal with venture capitalists because they don’t want their invention to be patented?

We seem to mean entrepreneurship not as mere ways to create new economic avenues but instead as ways to enrich our social capital.

If this is true, then the discrepancies between the Globescan survey and the existing data can be explained: the definition and the indicators used may not reflect the real meaning of entrepreneurship in Indonesia.

Indonesians feel that they are entrepreneurial and supported, but not in the way that most people may think.

We are interested in the enrichment of social capital and not merely in the creation of new economic avenues.

Entrepreneurs in Indonesia may score low in organizational growth perhaps because they don’t want the ambitious search for money to tear their family bonds apart.

Thus, theories and frameworks used to study entrepreneurship in Indonesia should take account of this particular perspective.

Similarly, entrepreneurship education and policy in Indonesia should get a paradigm shift and start encouraging young entrepreneurs to create social capital instead of mere financial rewards.

The writer, a faculty member of the Binus Business School, Jakarta, is a recipient of the Australia Awards Scholarship for the research into business models of social enterprises. He is studying for his PhD at the QUT Business School, Queensland University of Technology, Australia.

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About Ari Margiono

Researcher and a faculty member