Migo closes series B2 round, funded by YouTube co-founder and Go-jek commissioners
JAKARTA, September 7, 2020 – Migo today announced the close of a major funding round including highly-respected insiders from Jakarta and the region who can help Migo succeed in Indonesia. Key participants include Ray Zage, Commissioner at GoJek and Lippo Karawaci, and founding CEO of Farallon Capital Asia; Steve Chen, Co-Founder and former Chief Technology Officer of YouTube; Pandu Sjahrir, Commissioner at GoJek, Chairman of SEA Indonesia and Founder of Agaeti Ventures; Provident Capital; as well as existing investors including members from the founding family of Hysan Development in Hong Kong, Vickers Venture Partners, and Singaporean businessman Koh Boon Hwee.
Because Migo benefits from trends set by the COVID-19 pandemic, its 80-store network is already profitable well ahead of plan. Customers, on average across the total base, are also already visiting the wargo (warung Migo) to download 2 times per week. The proceeds of the round will go to accelerating the rollout in this particularly favorable environment and delivering more gigabytes to data-starved consumers.
Migo’s proprietary technology solution provides a complementary network in a healthy portfolio of emerging market assets with a focused use case: to deliver on demand video to low ARPU customers. Similar to how DTH is an ex-urban TV replacement to Cable, Migo fits into the data distribution portfolio alongside 4G, 5G and Fiber – each of which has its own use case. Its first product is O2O (online-to-offline) videos-to-go that lets users watch offline with zero buffering. Developed by Founder and CEO, Barrett Comiskey, Migo allows users of the Migo app to download movies and TV shows from a wargo, which is a neighborhood location where customers can access Migo’s patented technology to download content extremely rapidly – a feature film takes just 1-2 minutes.
Prior to launching Migo, Comiskey invented and co-founded E Ink, a unicorn which ultimately sold more than 100 million e-readers and set off the Kindle revolution. E Ink brought reading into the digital era and became a billion-dollar revenue company. Migo has the ambition and potential to be orders of magnitude larger and more disruptive. E Ink was developed for a decade and required $200 million in investments before taking off. Migo, with its software, hardware and retail content delivery network components, is similarly a major engineering and innovation effort. Comiskey has been working through the basic research and development of the solution, through commercialization, for ten years with his Taiwan-based product team, and with the support of early backers such as members from the founding family of Hysan Development and Temasek.
Migo’s target market is the data-restricted mass market segment, which is about 70% of the population. They are almost without exception mobile-only and have no broadband at home. As a result, they are mostly inaccessible to content aggregators and providers who distribute content over the Internet. Migo is a unique channel for any digital content provider seeking to reach the mass market, including its existing partners as well as global players such as Disney+, Netflix and HBO.
Migo’s solution soft-launched in Indonesia in March and transitioned to a 100% paid service in June. Since then it has grown rapidly, assisted by COVID-19 trends.
First, it is launching at a time of historic expansion in video-on-demand as screen time for adults with shuttered workplaces and children with closed schools has increased. As social distancing persists, even in the new normal, video consumption on personal devices will continue to grow.
Second, highly trafficked neighborhood retail locations such as small-scale grocery stores and warungs where the wargos are located have also experienced upward boosts as people limit their movement to essential activities.
Third, Indonesia’s cellular data speeds (ranked 118th in the world), caused by mostly high-volume and low-value traffic, build the need for Migo’s service. With people working from or staying at home more, cellular networks are increasingly overloaded with traffic which makes Migo’s buffer-free viewing a compelling alternative.
Fourth, for Indonesian consumers, many of whom are feeling economic strains, Migo delivers premium content at an extremely affordable price.
Finally, with schools shut down and children staying at home, Migo’s educational and entertainment content for children has been in particularly high demand.
Migo Indonesia was also founded with the vision of bringing digital inclusion to everyone in the country and helping Micro, Small and Medium Enterprises (MSMEs) adapt their offerings for the digital world. Although most Indonesians are able to connect online, data service remains expensive and slow and as a result the mass market is not able to fully participate in all of the educational and entertainment content that is being created and made available to those who can afford broadband at home or at work. Migo breaks down this barrier, allowing everyone with a smartphone the ability to consume the best premium content in the world. Similarly, Migo’s business model creates opportunities for millions of MSMEs to increase their income and allow them to participate in the digital content economy as wargo hosts and Migo Unli Pass retailers. They get guaranteed income from renting their space to host Migo’s hardware assets, experience significant sales uplift from their share of Migo revenues and the increased customer traffic, and get access to working capital from users cashing in.
Barrett Comiskey, Migo Founder and CEO said “We are thrilled to onboard new investors with on-ground experience and expertise as we launch in Indonesia. With their capital and support, they allow us to focus on our core mission of giving everyone with a smartphone access to premium digital content at affordable prices, de-risk our rollout, and capitalize in this favorable environment.”
Ray Zage, Commissioner at GoJek and Lippo Karawaci and founding CEO of Farallon Capital Asia said “Migo’s proprietary technology bridges the digital divide for the underserved mass market which opens up a large market opportunity. I believe Migo fills the infrastructure gap and will be the entertainment and educational content platform of choice for millions of Indonesians.”
Steve Chen, Co-Founder and former Chief Technology Officer of YouTube said “Migo solves streaming video for emerging markets. YouTube built the habit of short-form watching but Migo unlocks true bingeing behavior with offline longform.”
Migo’s unique network is 100x cheaper to deploy and is highly complementary to existing and emerging telco infrastructure. Its first product is O2O (online-to-offline) videos-to-go that lets users watch offline with zero buffering. Users download the Migo app (from the Google Play Store) and start selecting from the Content Catalog. They will then need to go to the nearest wargo (warung Migo), which are neighborhood locations where customers can access Migo’s patented technology to download content extremely rapidly – a feature film takes just 1-2 minutes. After that, they will purchase a Migo Unli Pass to unlock the content they downloaded and start watching.
Migo’s pricing is designed for mass market needs with Unli Passes that come in 1-Day, 3-Day, 7-Day and 30-Day packages costing Rp 3,000 (~$0.20), Rp 5,000 (~$0.35), Rp, 10,000 (~$0.70) and Rp 30,000 (~$2.1) respectively.