An IPO Is Not a Startup Success Story, Indonesian Investors Warn

By Olivia Hart

WeWork's collapse from a $47 billion valuation to below $10 billion — ending in bankruptcy in 2023 — is the cautionary tale Indonesian market officials invoked on Thursday (October 22, 2026) in Denpasar, Bali, to argue that going public is not a measure of startup success.

Eddi Danusaputro, Chairman of the Indonesian Venture Capital and Start-Up Association (Amvesindo), told a discussion session titled "The Exit Problem" that the success of an initial public offering looks different depending on who is judging it. The startup itself counts an IPO as successful if it raises funding. Early investors see it as a chance to cash out. Public investors expect to profit — and that expectation is not guaranteed.

"Again, such a situation is debatable. From our understanding as investors, the level of understanding of the retail (stock) market in Indonesia has not yet reached that level. Therefore, it is necessary to manage expectations," Eddi said.

Why Indonesian retail investors are a mismatch for startup IPOs

The problem, in Eddi's telling, is structural. Most retail investors on the domestic stock market are not long-term investors, and when they buy shares of a newly listed startup — whether on the main board, development board, or acceleration board — they expect dividends. Most startups do not distribute them. Startups bank on continued valuation growth instead, and their price-earnings ratios look nothing like those of traditional companies.

Eddi also noted the wider exit menu. IPOs are often difficult to execute, and startup share prices are prone to plummeting once initial enthusiasm subsides. Mergers, acquisitions, and secondary sales — selling a portion of shares to other investors — are increasingly common alternatives, though he said their frequency still needs to increase.

"While previously, investor success metrics were solely measured by multiple returns and the number of unicorns in a portfolio, the focus has now shifted toward business maturity," Eddi said.

The takeaway in plain words: a profitable, dividend-paying, sustainable startup has no urgent need to exit at all.

What does the stock exchange require before a listing?

Listyorini Dian Pratiwi, Head of the Listed Company Development Division at the Indonesia Stock Exchange (IDX), said fundamentals are the decisive filter for startups seeking to go public. High valuation growth alone does not guarantee sustainability. Financial condition, business model advantages, and good corporate governance all must be weighed before an IPO.

She reframed the listing itself as a starting line, not a finish. An IPO, she said, is the beginning of a startup's funding journey, with bond and sukuk issuances among the avenues that follow.

"An IPO has indeed become a strategic exit option. The obstacle sometimes lies in the startup's own readiness. An IPO requires both company readiness and the right momentum," said Listyorini.

Readiness, in her framing, means the business model, competitive advantage, and business plan. Momentum means market appeal: the valuation expected by earlier investors must match the valuation set by the market — retail investors, institutional investors, pension funds, and asset managers alike.

"For us at the Indonesia Stock Exchange, fundamentals are the key. No matter what your business is, if it is growing but still recording losses, we say that stocks without strong fundamentals will not last forever," she stated.

Her plain-words takeaway: growth with persistent losses is not a durable listing thesis, and a business model that closely resembles a competitor's will struggle to grow sustainably over the long term. Becoming a public company, she added, is a transformation — not merely another funding round.

How have post-IPO failures played out globally?

The track record cited in Denpasar was unforgiving:

• Pets.com, listed in 2000, went bankrupt within nine months of its IPO after a loss-making sales strategy and aggressive burn rate on advertising.
• Zynga, which went public in 2011, saw its stock fall 74 percent in its first year, hurt by dependence on Facebook's platform and failure to retain casual gamers.
• WeWork, which reached the market in 2021 via a special purpose acquisition company, fell from $47 billion to under $10 billion and filed for bankruptcy in 2023 amid poor governance, risky property lease expansions, and massive operational losses.

Quoting Business Insider on December 29, 2019, the discussion also cited Aryeh Bourkoff, founder of LionTree, an investment advisory firm covering technology, media, and telecommunications. He argued that startups need to understand the increasingly high valuation standards of capital-market investors, and that growth without a clear path to profitability will find it harder and harder to attract public money.

"The situation is reflected in the decline of Uber and Lyft's stock prices following their IPOs, as well as the failure of WeWork's IPO," said Aryeh.

He also flagged a cultural clash between startups' aggressive growth ambitions and public investors' demands for fundamentals and long-term profitability.

The session formed part of Bali Tech Week 2026, Indonesia's national technology week running October 19–23, 2026, which umbrellaed 13 digital-ecosystem events with the Bali Tech Week Conference at its center. The message for founders is blunt: if the exit is the plan, the market will now ask what the business is worth without one.