Qlue, an Indonesian startup that develops smart city solutions for the government and private sectors, is confident of turning profitable in 2020 on the back of 50% year-on-year revenue growth this year. Besides a successful four-year partnership with the Indonesian government to establish the country's first smart city platform in Jakarta, the company has also expanded to seven countries overseas.
The team is currently working on a Series B round of funding that will be closed “as soon as possible” in 2020. Qlue raised Series A funding from GDP Venture and MDI Ventures in February 2019. The new funds will be used to boost its teams in sales and business development.
Formed in 2014, Qlue is currently working with 40 Indonesian cities and 22 provincial police departments. It targets to increase its reach to 34 departments and 100 Indonesian cities in 2020, as well as more private clients to maintain its “high double-digit” growth.
“The way I see it, profitability is inevitable, as we've already been self-sustaining since July–August this year,” Qlue founder and CEO Rama Raditya told CompassList. “We are confident that we can be profitable within the next 12 months.”
Going global
Qlue has opened a representative office in Malaysia, and its smart city solution is being used in two Malaysian townships: Cyberjaya and Medini. Elsewhere, Qlue also has markets in Ho Chi Minh City and Da Nang in Vietnam, Dubai, Barcelona, and Madrid in Spain, and Taiwan.
Qlue's international clients are mostly interested in its citizen reporting system and the data integration dashboard. “In places like London there are already a lot of cameras and some cities are already using AI for these purposes, yet they haven't really implemented citizen participation mechanics,” Raditya said.
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When Qlue started working with the Jakarta city government, it introduced the idea of collating citizens' complaints into actionable data and displaying the information on a map and dashboard. In a sense, Qlue used citizens as “sensors” for various problems in the city. Computer vision, AI, and IoT only came later as Qlue developed its technology stack and saw the potential in harnessing Jakarta's many CCTV cameras.
To comply with the strict security and privacy demands of its clients, both public and private, Qlue's infrastructure allows for on-premises data storage. “We also familiarize ourselves with legal privacy requirements and set clear boundaries on what data cannot be shared with third parties, because we're working with citizens' data,” Raditya said.
Greater private-sector focus
Qlue's private-sector clientele includes manufacturing companies, real estate developers, and companies that require AI-powered data processing and intelligence solutions. The work, said Raditya, is similar to what they did in Jakarta, on a smaller scale. Qlue plans to work with more private clients in the future. Its private-sector clients currently comprise about 45% of its market, a proportion the company targets to increase to 60% in 2020.
“A lot of what we do in the city management is also done in factories, like internal reporting and personnel tracking,” said Rama. "Some minor differences exist, like how in city management we don't really consider different floors in a building, but we manage assets by floor in an office or a factory.
“When we succeeded in Jakarta, we began offering our products to other cities, as well as private, township-scale property developments," Raditya said, referring to independent townships like Bumi Serpong Damai (BSD) that is managed by the Sinar Mas conglomerate. “Our work with government became an entry point to working with enterprise clients. If our solution can solve the problems of a crowded and complex city like Jakarta, then it will probably work in real estate developments.”
Private clients tend to know better what they need and they also adopt new systems quickly, Qlue's Chief Commercial Officer Maya Arvini said. “Governments have bureaucratic processes, so we provide help in consultancy and advisory and the sales process is longer. We have to help define what their requirements are and how to solve their problems.”
Big changes
For Raditya, the formula for profitability is simple: reduce costs, and increase revenue. Getting there, however, meant making big changes, including to the company's culture.
Rama and his co-founder Andre Hutagalung entrusted the reform task to Arvini, who previously worked at IT multinationals IBM and Microsoft, as well as diversified conglomerate Gunung Sewu. Arvini joined Qlue in January 2019 and immediately went about overhauling Qlue's internal culture.
“As a startup grows, it will need different sort of people compared to when it first started. The personnel will either have to level up or they'll end up getting left behind,” Arvini said. “I revamped the organizational structure and systems, even down to basics like discipline and accountability. We let go of people who were not in line with our spirit or lacked the right competencies and work ethic.”
Arvini went on to bring in new hires with corporate experience and placed them in various departments to put in place a culture of accountability, professionalism and corporate mindset. She also automated administrative processes and improved internal operations, such as accounting, legal and HR, including, ensuring that job descriptions are clear, so employees do not wait for instructions and know exactly what they are responsible for.
Her experience in B2B and media relations is also crucial to the company's pursuit of private clients to expand globally. Qlue staff attended various international exhibitions and media events in 2019, including leading a delegation of Indonesian municipal heads to the Smart City Expo at Barcelona. The company even organized its own Smart Citizen Day in March.
The company has also won many accolades, including the Best M-Government Service award at the World Government Summit in Dubai. “We've received so many awards even without joining many competitions. I am positive that it will lead to more opportunities for Qlue,” Arvini said.
