Gopher's Indonesian gamble pays

Gopher co-founders John Campbell and BJ Sveistrup are on the lookout for investors.Photo / Greg Bowker

Founders of digital advertising business ignored warnings Singapore or the Philippines would be a safer bet.

When the co-founders of Stanley St-based digital advertising business gopher.co.nz started to look for a new market in Southeast Asia, they were told to steer clear of Indonesia.

"Everyone said go to Singapore or the Philippines," says chief executive John Campbell, who started the business in 2007 with Dilworth School friend BJ Sveistrup.

When Gopher suggested Indonesia, people said: "You can't telemarket there. The culture won't allow it and credit card penetration is only 5 per cent. People will want to pay by cash or bank transfer. It will be a nightmare."

Their response, says Sveistrup, was to say: "It would be the hardest territory first and the biggest opportunity."

Compared with India and China, Southeast Asia looked less competitive and small to medium-size enterprises looked under-served.

GDP was also growing fast, it had a rapidly expanding middle class and advertising spending was climbing.

Gopher, ranked 20th in the 2010 Asia-Pacific Deloitte Technology Fast 500, and 17th in the 2012 Deloitte Fast 50, had also found that 98 per cent of Indonesian businesses were without a website, which created a massive opportunity, says Campbell.

After six months in the market, Gopher's Jakarta office has 70 staff - a point that took the New Zealand business three years to reach.

"And the business is profitable. We're very pleased with the pace of growth, although we're still constrained by lots of issues with infrastructure and other operational concerns. It's a huge market, there are 17 million SMEs in Indonesia, of which about 7.5 million are our market," says Campbell.

In July, Gopher Indonesia was named Google's first and only official Premier SME partner for Indonesia. It has been a Google AdWords premier SME Partner for New Zealand since October.

Gopher charges a fixed price to help small businesses drum up sales through the internet, which it does with national and local business directories and through search, social media, mobile and Google AdWords campaigns.

"Our proprietary technology allows us to service hundreds of thousands of small businesses in a highly automated manner at a fraction of the cost of other providers," says Campbell.

Next year, Gopher's senior management is planning to "up the ante" in New Zealand, where it has 150 staff, while continuing to expand in Indonesia and launch in Thailand.

"Thailand and Indonesia combined mean we are operating in countries with a total of over 300 million consumers and 10 million addressable SMEs," says Campbell.

"Our vision is to become a leading provider of digital advertising products to SMEs in the Asia-Pacific region long-term, exploiting the market opportunity as advertising follows consumers online.

"We are looking to be a substantial APAC tech company of 1000-plus people."

Later next year, Gopher will look for investors. The company, which is majority-owned by Campbell, with shares also held by Sveistrup and a handful of employees, has turnover in the millions of dollars.

"We're really looking for sophisticated strategic investors or venture capitalists that have experience rapidly scaling technology companies," says Campbell. "We've been establishing some relationships over the past six months and everyone's interested in Indonesia - including many of the biggest and best known tech VCs from the US, China, Japan and Korea."

Best business achievement
"Internationalising Gopher. Taking the Gopher brand, products and systems and creating another entity in a foreign country, with a different language and culture, without any external support and when everyone said we couldn't. And becoming Google's first and only Premier SME partner in Indonesia."

Top tips
"Get your business online. Your customers are searching for you online, and you need be there - virtually - when they come calling."