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There’s only one story to discuss today and that’s the sentencing of Nadiem Makarim to 10 years of prison in Indonesia. The founder of Gojek, he entered politics in 2019 as Indonesia’s education minister but his time in office was dogged by accusations over a school laptop programme. The ruling doesn’t look convincing, but this is another tough blow for Indonesia’s startup and business ecosystem.

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Indonesia has done what everyone hoped it wouldn’t do and sentenced Nadiem Makarim, the Gojek founder and former education minister, to at least 10 years of prison for corruption relating to a school laptop procurement programme during the pandemic.

He was ordered to pay a IDR 1 billion ($56,000) fine and a further IDR 809.6 billion ($45 million) in restitution. Failure to pay the amount would add 5 more years of jail time.

The case is well known (unfortunately) given how badly things went. This was a young founder who fought Uber and regional champion Grab to build Indonesia’s first billion-dollar company, which would go on to reach a $10.5 billion valuation. He made a surprise move into government in 2019 because he said he wanted to give back to his country and make a difference.

At the time, Makarim looked like a future leader. A young man who championed the new economy and built a business that gave millions of Indonesians a new way to make a living. But somehow we’ve reached this situation where he’s going to jail.

One year into his role, his key policy was to increase digital access and literacy with an initiative to buy 1.1 million Chromebooks for schools across Indonesia. That is the case prosecutors seized on, although their verdict looks unconvincing.

Things look particularly bleak given the recent sentencing of four executives from state-linked funds for simply doing their job.

Let’s start at the beginning and review the verdict:

• The court ruling was 4-1, with one judge dissenting

• Nadiem Makarim has not been sentenced for kickbacks, bribery or illicit payments, despite accusations.

• The judges said there was no evidence that he controlled Gojek during his time in government.

• Claims that a WhatsApp group chat showed intent of criminal conspiracy before he came into office were rejected by the court.

• His meetings with Google executives were deemed to have been part of the job as education minister.

• But Makarim has been sentenced based on alleged state losses of $122 million, despite his defense team claiming that 97% of the devices were distributed, reaching more than 77,000 schools.

• He was also found to have committed “an abuse of authority” to help Google grow its business. That’s anchored on Google being an investor in GoTo (the business that Gojek became when it merged with Tokopedia) and Makarim continuing to be a shareholder in the company.

The Chromebook deal is said to have cost the state IDR 2.18 trillion ($122 million) in losses, they argue. Makarim himself is said to have personally made IDR 809 billion ($45 million) through the transactions, but it isn’t clear how that figure is calculated. (Clarity here seems very necessary since he faces 5 more years in jail if he doesn’t pay this amount back.)

Google itself was not tried, and multiple Google executives testified in Makarim’s defence during the trial.

“We have not offered, promised, or provided benefits to education ministry officials in exchange for their decision to adopt Google products,” Google said in a statement back in January. The US company should now come forward with more information.

This verdict sends out a chilling signal to anyone looking to do business in Indonesia, let alone in the tech sector, which used to be a buoyant and surging industry in the country. Indonesia attracted $6.9 billion in VC investor funding in 2021, with a number of funds going ‘Indonesia only.’ But that figure fell to $355.7 million last year. Once Southeast Asia’s main event, Indonesian funding fell behind Singapore and Vietnam.

That was before this year when things have gotten worse still. Yes, there have been cases of actual startup fraud, but trials like this make Indonesia’s judiciary appear unfamiliar with the workings of business (at best) or, at worst, they’re outright efforts to neutralise political opponents or find opportunistic scapegoats.

We can duly expect a lot less startup activity in Indonesia in the public domain.

Privately, a number of VCs have told me that they are not actively looking in Indonesia due to these events and the perceived risk. Those who focus solely on the market are waiting for things to clear up. I believe that will happen as I do think startups can tackle outstanding problems that traditional businesses can’t, such as education, financial services and logistics. But it will need time for the good actors to take the limelight.

For now, it’s almost like the Indonesian government is at war with startups. That’s a big shift from earlier in the decade and the 2010s when the likes of Gojek, Tokopedia and others were widely celebrated and the government closely aligned with their success stories.

Now, as we wrote at the sentencing of the four state-linked VCs, it’s hard to see why Indonesians who have been successful or studied overseas would want to give back to their country.

“Youth across all of Indonesia, and the diaspora in every corner of the world, await your answer to the question echoing in their hearts: ‘Is this country still safe for us to serve?’,” Makarim, who graduated from Harvard, asked after the trial.

Webull, a Robinhood rival founded by a former Alibaba executive, is buying Thailand-based investment company Pi Securities for around $100 million. That’s a decent exit for a Thai startup, but we understand not a crazy exit given its previous valuations. Pi is a fairly offline business that leans on agents; Webull is likely buying it to get a footprint in Thailand’s lucrative investment market, acquire licenses and grow its digital business. [Bangkok Post]

Singapore merchant operating system startup Qashier raised $6.1 million round to expand across Southeast Asia [TechNode Global]

Akro, a Singapore-based AI startup, raised a $700,000 pre-seed round led by Amigos Venture Capital [TechNode Global]

Southeast Asian insurtech Igloo acquired Thailand-focused rival Eazy Digital in an undisclosed deal [Igloo]

South Korean game maker Wemade is reportedly selling 40% of its business to a consortium led by Chinese investment platform in a deal that values it around $600 million [Bloomberg]

India’s OYO is finally going public. Parent company Oravel Stays has filed updated IPO papers to raise up to INR 6,650 crore ($703 million) through new shares, with no existing investors selling stock. It may also raise up to INR 1,330 crore ($141 million) before the IPO. [Economic Times]

There’s yet more Hong Kong IPOs after five Chinese tech and manufacturing companies launched listings seeking up to HK$44.1 billion ($5.6 billion), that’s led by Apple supplier Luxshare’s planned raise of up to HK$24.27 billion ($3.15 billion) [Reuters]

Tencent has increased share buybacks after a Hong Kong stock selloff erased about $309 billion in market value since October [Bloomberg]

In a major landmark for China’s self sufficiency push, Meituan open-sourced LongCat-2.0, its AI model that features 1.6 trillion-parameters and a 1 million-token context window. Crucially, it claims it was trained and run on a 50,000-card domestic Chinese computing cluster with no foreign hardware. [SCMP]

Taiwanese authorities raided Super Micro Computer’s local offices and the homes of six people linked to the company as they widened an investigation into alleged Nvidia chip smuggling to China through servers [Bloomberg]

Chinese smartphone makers Xiaomi, Oppo and Vivo have cut 2026 shipment targets again, with some reductions reaching 30%, as rising costs and severe component shortages pressure the market [Nikkei Asia]

Japan’s attempt to fully legalise ride-hailing has stalled after a government reform council offered only vague commitments, leaving taxi-industry opposition and transport ministry resistance largely intact [Nikkei Asia]

Japan plans to provide 150 billion yen ($926 million) in subsidies to a Rakuten-led consortium building a low-Earth orbit direct-to-mobile satellite network with AST SpaceMobile [Nikkei Asia]

Major Washington lobbying firms are dropping Chinese tech clients including Alibaba and Tencent as a new US law forces firms to choose between Chinese companies and US defence contractors [Bloomberg]

Applications for Japan’s business management visas have fallen after tougher rules raised the capital requirement, complicating the government’s push to attract more startup founders [Nikkei Asia]

Exiled Chinese billionaire Guo Wengui, also known as Miles Guo, was sentenced to 30 years in a US prison for crypto-related fraud after prosecutors said he used his following to promote fraudulent investment schemes [The Block]

And finally, WhatsApp is adding usernames, at long last [BBC]