Selling from Sydney into Jakarta should, in theory, not be as hard as it is in 2025. Australia and Indonesia have a bilateral trade relationship that has been growing for a decade. The consumer appetite for international brands in Indonesia is real and well-documented. The digital infrastructure — mobile penetration, fintech adoption, logistics network density in major cities — has improved substantially. And yet, an Australian brand that attempts to sell direct-to-consumer into Indonesia encounters a chain of friction that would have discouraged a reasonable operator at almost every step: Indonesian customs duty classification that requires specific HS code knowledge, VAT registration requirements that changed under Peraturan Menteri Keuangan PMK 48/2023, payment method coverage that requires GoPay and OVO integration alongside conventional card schemes, and last-mile delivery into addresses that are formatted in ways Australian fulfilment systems weren't designed to parse.
The payment layer is the most visible friction point, but it's often not the most expensive one. Indonesian consumers have very high payment method preference diversity — an Australian checkout that presents card payment and PayPal as the primary options is going to see significant drop-off from consumers who use bank transfer (bank transfer via Virtual Account is still dominant for many categories), GoPay, OVO, or QRIS. Building out that payment method coverage requires either direct relationships with each payment method provider — which for a small Australian brand is simply not commercially viable — or an intermediary layer that aggregates Indonesian payment methods into an API that the merchant can integrate without managing each relationship separately. That intermediary layer exists, but it's not well-known outside the APAC payments infrastructure community.
Compliance is the friction layer that catches brands off guard after they've solved the payment problem. Indonesia's import duty structure for B2C e-commerce changed several times in the 2022–2025 period as the government responded to concerns about the competitive impact of cross-border e-commerce on domestic retailers. The de minimis threshold below which imported goods cleared without duty has been revised, the applicable duty rates for specific categories have been adjusted, and the registration requirements for overseas sellers using e-commerce platforms as fulfilment channels have become more explicit. A brand that set up a cross-border selling arrangement in 2022 and hasn't reviewed the compliance requirements since is likely operating under assumptions that no longer hold. This is the kind of regulatory evolution that requires someone in the market to be tracking it continuously — which is exactly the kind of support infrastructure that's missing for small and mid-size Australian brands attempting APAC expansion without a local team.
The Philippines corridor presents a different profile. Philippine customs has a different duty structure than Indonesia, the dominant payment methods — GCash, Maya, and bank transfer — have different integration requirements, and the last-mile logistics network has a distinct geography challenge given the archipelagic structure of the market. An Australian brand approaching Southeast Asia as a single market and building one integration that works across all corridors is going to be disappointed. The practical reality is that meaningful presence in Indonesia, Philippines, and Malaysia requires at least some market-specific configuration on each of the payment, compliance, and logistics dimensions — and the infrastructure tools that manage that complexity for mid-size brands from a single integration surface are still underbuilt.
The investment thesis implication for us is clear: the companies building the cross-border commerce infrastructure layer that makes APAC expansion accessible to brands below the enterprise threshold are working on a problem that is structurally large and structurally underserved. The corridors are real, the commerce demand is real, and the friction is not theoretical — it's measurable in the form of cart abandonment rates, customs clearance delays, and brands that launched APAC initiatives and quietly retreated after discovering the operational complexity. The infrastructure that reduces that friction, without requiring each brand to become a cross-border compliance expert, is a category we're actively deploying capital into through Fund II.