At midnight on July 9, Ahmad Rifai was restless. Rifai is a former business journalist and self-described “enthusiastic startup watcher,” and that morning, one of Indonesia’s biggest tech companies, Bukalapak, announced plans for its much-anticipated IPO in Jakarta, which was expected to value the e-commerce platform at $6 billion. Rifai opened Twitter, where he saw a slew of tweets about the listing.
Suspicious, he investigated, using the Twitter scraping tool Twint, to extract data on hashtags relating to the IPO, and Gephi, to visualize patterns in their use. He tallied up a total of 2,982 tweets that contained the keywords “beli saham Bukalapak” (buy Bukalapak shares) and the hashtag #BeliBuka (Buy Buka), which he suspected were pushed by a network of bots. A month later, at the culmination of Bukalapak’s listing process, another hashtag, #BukalapakIPO, emerged.
As he dug, Rifai found that it was being boosted by a diverse cast of characters. Well-known figures, like social media personality Pantun Galimar and stand-up comedians Fico Fachriza and Arie Kriting, were recirculating the hashtag, along with exuberant promises of profit. Elsewhere, one branch of tweets was frantically mentioning Cathie Wood, the high-profile American tech investor and founder of the $50 billion ARK Invest management firm.
“I saw people saying they were told to mention Cathie Wood so that she would look at Bukalapak. I found two names — Rita Efendy and Ci Tjoe Ay,” Rifai told Rest of World.
He continued to follow the trail. Efendy, it turned out, operates a YouTube channel called Indonesia Investment Education (11,100 subscribers) and a popular Telegram group called IDX Trading Community (ITC) with over 33,000 members. At the time of the Bukalapak IPO, the latter shared retweet-ready posts to influencers it designated as “key opinion leaders,” and encouraged followers to “retweet and enliven today’s trending topic, Bukalapak IPO.”
Indonesia’s online influencer culture, which sees YouTubers promoting a controversial government jobs policy and indie rockers boosting crypto assets, has quickly taken root in the country’s booming trading community. Sharing your latest investing obsession with your thousands of online followers isn’t illegal. But hazy regulations about investment advice leave ambiguity about exactly when influencer promotions veer into targeted stock boosterism.
Fresh investors led astray by spurious trading advice have called for the government to take action against “pom-pomers,” influencers who share tips but lack expertise. That has raised questions about the harm to inexperienced traders, as stocks like Bukalapak go on an erratic rollercoaster of online enthusiasm.
Ci Tjoe Ay (“Sister” Tjoe Ay) is an affectionate name for Kartika Sutandi, the chief marketing officer at Jarvis Asset Management, a $56.7 million fund based in Jakarta. Sutandi admitted to having played a hand in mobilizing hundreds of people on Twitter to mention Cathie Wood, albeit accidentally.
“We were just joking around,” Sutandi told Rest of World. “We said, We must tag Cathie Wood so that she looks at Indonesian tech, that we’re not less than any other Southeast Asian countries, like Singapore, and that we have the most unicorns,” she recalled. “I didn’t tag her, the other kids did. Then, it went viral.”
Bukalapak stock jumped 25% on its debut, hitting the bourse’s upper limit before crashing on the third day. The stock has lagged since.
Over the span of three weeks, starting mid-December last year and ending in early 2021, Kaesang Pangarep, the youngest son of Indonesian president Joko Widodo, tweeted nine times about the stock of mining company Antam to his 2 million followers. The share price surged over the second half of December and has hovered at levels about 50% higher since then.
On January 4, media personality Raffi Ahmad let his 57.8 million-strong Instagram audience know that he’d invested in digital infrastructure firm M Cash Integrasi, whose stock jumped by 6% and has shot up nearly 300% from when the post was made.
“$antm is unstoppable,” Kaesang said in one tweet. Raffi was more elaborate, posting a video about how the money he invested in M Cash had gone up more than 20%. He was relaxed, relatable, saying, “Hi guys, I’m Raffi Ahmad, I just want to share my experience. This is the first time I’m investing my savings in a company called M Cash.”
Influencers like these have a ready-made and growing audience. During the pandemic, smartphone users from Seattle to Seoul were persuaded by the promise of overnight wealth. In the first six months of 2021, Indonesia saw a nearly 50% jump in the number of retail investors, up to 5.6 million, and a million more flooded into crypto investing. These new investors are overwhelmingly young people: over 70% are between the ages of 17 and 30, according to Indonesia’s central securities depository.
As influencers have risen to fill the information gap, they’ve flourished in a regulatory gray area. Content that recommends buying or trading investment instruments is governed by the Indonesian financial regulator OJK’s Rule V.H.1, which prohibits people giving investment advice from misrepresenting their own qualifications and guaranteeing that their advice will yield specific results. But the law, formalized in 1996, doesn’t say anything about the casual sharing of information on social media.
IDX, the Indonesian Stock Exchange, has itself been instrumental in promoting the trend: in 2018 and 2019, the exchange partnered with a hand-picked group of lifestyle influencers, with the aim of attracting young people to investing
How influencers earn their money is a complex question. Some are hired to promote trading apps, like Ajaib and Pluang, or they might invite followers to open an account with the brokerage firm they use themselves. Separately, there are communities that charge a modest fee of around $20 to aspiring billionaires in return for access to exclusive Telegram discussions or workshops with experienced stock pickers. But it’s even more unclear how lifestyle influencers without attendant pay-to-learn communities or promotion deals can profit by promoting stocks online, unless they use their followings to increase the value of stocks they hold themselves.
The administrator of the influential investment community Saham Daily, who goes by the alias “Donny Walks,” told Rest of World that the community does “everything for free” and doesn’t do paid promotions. Saham Daily has a healthy following of 34,000 on Clubhouse and 122,000 on Instagram. It makes money from premium membership, where members can get access to a stock database, stock recommendations, and private stock consultation.
When Bukalapak went public, Saham Daily’s Telegram channel was alive with chatter around the IPO, and Walks managed to invite the company’s president, Teddy Oetomo, to speak on its podcast, a day after Rifai publicly shared his findings. He said the community is educational and a way to open up the stock market to retail investors through information. “If people want to call that ‘stock pumping,’ that’s alright, it’s their perception,” he said. “But the main idea here is actually education.”
However, “I started refraining from posting stocks unless they clearly have gone up already,” he added.
The losers from the Bukalapak rollercoaster were very online and very vocal. Their disappointment has underscored calls that have circulated online this year for restrictions on influencers who drive the stock discussion.
Angry reactions flooded social media after Bukalapak’s stock plummeted and left investors without the profit they seemingly expected. They raced to Apple’s App Store to leave one-star ratings on the company’s e-commerce app — furious comments like “Big scam,” “RIP BUKA stock,” and “Burden for the JCI.”
“Loss at $BUKA… if you’re not ready to jump into the stock market, better not get involved,” posted one Twitter user. “Better to give a bad rating to your brain.”
The professionals have little pity. Sutandi, the Jarvis CMO, believes it’s the responsibility of individual investors to navigate through the abundance of information on social media. “Blaming the people who talk [about stocks] is wrong, in my opinion. The one to blame is the one who presses the button to buy or to sell,” she said.
Robert Djufri, chief marketing officer at Investor Muda, an investment management group for young investors, cautioned, “We don’t know if [these influencers are] really offering good information or they’re just getting attention because they’re famous already and telling people to follow trends.”
In November, China’s government banned brokerages from hiring influencers. Regulators in Indonesia might also be getting ready to tighten the screws. In early December, OJK issued a strong warning against influencers promoting stocks online, saying that it’s a criminal act to offer investment advice without a license. (Its reach is still limited. Walks said that Saham Daily doesn’t need a license to operate its membership model, because they don’t actually manage funds.)
Regulation updated for the influencer age could force over-exuberant pom-pomers off social media. But although efforts by TikTok to curb misinformation about investing and trading pushed some investment finfluencers off the platform, it did little to stem the overall tide — many simply moved over to Instagram. Effective regulation would need to get past a platform-by-platform whack-a-mole approach.
“That social element of trading has always been a part of retail investing and even institutional investing,” Zennon Kapron, founder of fintech consultancy Kapronasia, told Rest of World. Kapron described going to a stock-hawking event in China in 2007, where promoters shilled for their stocks while standing on upturned milk crates. “You just replace that guy on the milk crate with a WhatsApp chat group — this is just a natural extension of that.”