Path is funded and Bakrie Global Group lead the round, I heard this discussion among Indonesian investors for a while and today it’s official. Suddenly my Path timeline filled in with Bakrie & Path meme.

Path is valued at USD 400 million and the USD 25 million investment led by Bakrie then valued around 6.25% of the company. Considering that Bakrie is not the only investors in this round, their stake is even less. So, it is not that much influence in Path. Looking at Crunchbase, with more than 30 individuals and institutional investors, practically we see the who’s who of Silicon Valley put stakes in Path. Their best interest is making Path go public and every investor has their exit and financial reward.

Path is a hit among the urbanites, as Facebook becomes mainstream and there’s no sense of privacy anymore. It’s getting adoption in Indonesia since most people have tendencies to have too many friends on Facebook. With Path limit to 150 people on each account, we keep the sense of privacy among close friends.

Indonesia is Path’s no 3 market. Dave Morin knows this and looking into a strategic investment that bring in value more than money. Path is getting into Indonesia market and need local expertise and partner. I believe Path have a big chance to succeed in Indonesia. Here’s why.

#1. Mobile First

Not like Facebook, Path is built for mobile. The first experience and user interface is smooth. Many other apps are trying to simulate its interface on mobile. We have more than 240 million mobile users, and only less than 30% are on smartphone. Plenty of room to grow. With Indonesian mobile user getting into smartphone, Path will be a choice among mobile users, especially when they bundle the service with the local telco. PC is declining, so Facebook full experience on desktop is on the losing compare to Path smooth experience on mobile.

#2. Cool Factor

Adoption and virality among social network starts with people. The early adopter of Path is youth, tech circle and urbanites. They are the cool people. They spread the usage of Path before it leaps to wider audience. Path can ride the smartphone growth combine with its user adoption from early adopter to mainstream.

#3. Alay Factor

Basically everyone wants to separate their social circle. When your parents add you on Facebook, then it’s no longer cool. When people you don’t know starting to add you as their social circle, then you will feel uncomfortable, especially for woman.

When middle class consumers adopt social media like Facebook, we will see a lot of Alay. It is when these users start to add everyone as their social circle just because someone is considered cool and sweet. The Alay culture phenomena spans over a wide array of styles in music, dress, and messaging. That’s why people left Friendster. But Alay is a crucial factor to gain mass adoption in Indonesia. They are the majority users in Indonesia.

With Path limited number of friends, it keeps people from different social circle to mix. It’s good for the users and great for Path as the initial users will not leave the network because it’s not cool anymore.

#4. Localization

Most Indonesian doesn’t speak English. Kaskus is a success because it’s very Indonesia. Friendster at its height have 22 million users before declining, Facebook currently have 64 million users. Even though not many people know about Mig33 that focus on feature phone got more than 30 million users. The key to success for local social network is always localization, from languange to social factor. I believe this is the key for social media to get mainstream adoption.

#5. Monetization

The only way for social network to sustain is business model. Facebook and Twitter use advertising. Path selling stickers, similar to Line. Virtual items model is successful in Korea, Japan and China. In order for users to pay, it should be connected through telco billing or e-voucher. Path need to connect with local telco for their billing as well as distribute e-voucher though local distributor. Being invested by local investors, it’s easier for Path to tap into local distribution and payment.

Rene Suhardono the Career Coach, a friend of mine, announced #NoPath4Me as he officially leaves Path. His standpoint is Bakrie finances the social media but they didn’t compensate the victim of Lapindo mudflow disaster. The disaster was caused by exploration activities leading to a blowout at one of Lapindo’s natural gas wells. They persistently denied its exploration activity was the cause of the mudflow, and blaming an earthquake in Yogyakarta. Even though I respect this decision, I don’t see that it is going to impact Path, unless Rene is able to create a social movement involving major media. And Path does not belong to Bakrie, since they only have a small stake.

What does this mean to Bakrie? A great PR tools of course. With little money, his name suddenly become relevant among Indonesian and around the world. Bakrie gets its PR. Dave Morin gets Indonesian consumers. Indonesian can brag that Indonesia has our own global social network. And Silicon Valley looking into Indonesia as the new cool place to invest.
Everyone wins right! ☺