Singapore Family Offices Targeted By Indonesia’s Tech Billionaires

SINGAPORE – Indonesia’s newly-minted tech billionaires are increasingly eyeing to establish family offices in the city-state, as they start diversifying their wealth and seek new investment opportunities here, reported The Business Times on Monday morning (29 August, SGT).

While traditional family-owned businesses from Indonesia have long established a presence in Singapore, more of the country’s technopreneurs are now joining this exclusive group.

Notably, Indonesia has produced 13 unicorns in the last 10 years, including start-ups like OVO, Gojek, Traveloka, Bukalapak, and Tokopedia. Moreover, the COVID-19 pandemic has generated a 2nd wave of unicorns including e-logistics firm J&T, investment platform Ajaib, and payment platform Xendit.

According to estimates by Singapore’s central bank, there were around 400 single family offices at the end of 2020, and roughly 700 at the end of 2021. However, the Monetary Authority of Singapore (MOM) does not have estimates on their business spending, local investments, or assets under management (AUM).

Industry players revealed that the number of Indonesian family offices here has jumped by up to 50 percent in the last three years.

“Many of these new family offices are set up by Indonesia’s new tech billionaires,” said Withers KhattarWong’s Private Client and Tax partner, Stacey Choong.

“Singapore has stability, an available talent pool, strong financial infrastructure, a tax- and regulatory-friendly regime, and a welcoming approach to bring suitable talent to staff family offices and manage wealth. All this makes it a gateway to the ASEAN region.”

Ho Kah Chuan, the CEO of Go Global Gem, an accounting company focusing on private clients, also disclosed that the number of their Indonesian customers spiked post-COVID.

“We have seen a significant pick-up in the number of wealthy Indonesians looking to set-up family offices or trading houses over the past few months.” He explained that many Indonesian trading houses and business houses have operations in Singapore as it’s a sophisticated financial hub.

The rationale for establishing a presence in Singapore include accessing tax benefits, wealth preservation, and succession planning. Many affluent Indonesian families are also setting up charity foundations here to invest in eco-friendly projects.