Warburg Pincus leads $25m Series B in Indonesia’s OnlinePajak | #VentureCanvas
Mars Woo | DealStreetAsia – VC
Indonesia-based tax compliance solutions provider OnlinePajak has raised over $25 million in its oversubscribed Series B funding round led by an affiliate of global private equity firm Warburg Pincus.
The company said it will use the fresh funds to expand its business through innovation and providing “better solutions” to their users. Established in 2015, OnlinePajak aims to help firms reduce their administrative burden through seamless tax management.
The latest funding round was participated by Global Innovation Fund, Endeavor Catalyst, and existing investors Alpha JWC Ventures, Sequoia India, and Primedge. Last year, the company raised about $3-$5 million in its Series A round led by local venture firm Alpha JWC Ventures and joined by Sequoia Capital.
OnlinePajak offers an integrated solution that it says can help remove corporate administration hassles for taxpayers and increase tax collection. Since its launch in September 2015, OnlinePajak said it has been used by more than 900,000 users, with corporate users including Garuda Indonesia (Persero) Tbk, Telkomsel, PT Astra Otoparts Tbk, TNT Skypak International, Bank Permata, dan Asuransi Sinarmas.
It claims its solution can save corporate taxpayers a lot of time by helping them manage their monthly taxes, invoices, and employee salary in one place without having to stand in a queue at the tax office or the bank.
Under the company’s current business model, its tax application is available for free to use by both the government and the taxpayers. Users are charged if they opt for some of its premium features such as tax filing integrated with accounting and HR systems.
“With the new investment, we are going to unleash a true revolution in tax compliance through technologies such as artificial intelligence and blockchain technology. We plan to significantly accelerate the expansion of our capabilities
to continue benefit the taxpayers as well as the Indonesian government,” said OnlinePajak founder and CEO Charles Guinot.
Commenting on the investment, Jeffrey Perlman, Warburg Pincus Head of Southeast Asia, said OnlinePajak has a “tremendous growth potential” having built a technology platform for Indonesian taxpayers.
“We have been strongly impressed by the virality of the business and we believe that the company has tremendous growth potential – not only in helping businesses across Indonesia to operate much more efficiently but also in playing a key part in realizing the Indonesian government’s vision to broaden the country’s tax base,” Perlman said.
OnlinePajak’s fundraising comes at a time when the Indonesian government is seeking to improve tax compliance, especially in the country’s e-commerce industry.
According to a Bloomberg report early this month, Indonesia plans to require online merchants to own tax identification numbers starting this year, as part of efforts to boost revenue and improve compliance in the fast-growing e-commerce industry.
President Joko Widodo is accelerating efforts to boost revenue to help finance billions of dollars in infrastructure projects as the economy struggles amid an emerging-market rout.
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