Like many of his third-generation counterparts, Martin G Hartono juggles his job within a highly-successful family business with other passion projects. His interest in information technology runs deep.
On top of his responsibilities as a director at his family’s Djarum Group, Indonesia’s second largest cigarette maker, he set up Global Digital Prima (GDP) last year in a bid to develop the local IT business landscape.
The company is a venture capital firm which works to develop opportunities in e-commerce, social networking, digital media and a slew of related subjects. Last year he made several bold strategic steps, acquiring an internet shopping site, Blibli.com and Kaskus, Indonesia’s largest social networking site, as well as MerahPutih.com, Indonesia’s first tech and digital business incubator.
GDP is also in talks to fund other start-ups: carikos.com, a site to guide people looking for lodging, and SemutApi Colony, an online marketing and communications consultancy. As many in the digital business industry recognize, Martin is one of a clutch of progressive entrepreneurs who has identified the sector’s potential to bolster Indonesia’s economy.
His plan is to continue acquiring local start-ups, but he insists that businesses need a clear business model before they can be launched.
Also important is clear knowledge of each company’s founder; with digital businesses relying heavily on ideas and creativity, he says. Understanding the background driving each enterprise will go a long way in developing content, business models and expansion plans for the future.
Patriarch Budi Hartono has long groomed the next generations to lead Djarum Group into the future. Martin’s youngest brother Armand Wahyudi Hartono is now a key figure at Bank BCA, where he has been operations and networking development director since 2009.
With a strong background in international finance and banking, Armand is on track to lead the bank to greater operational efficiency and, eventually, to take control of the BCA Group.
He began his career at the bank as head of planning for regional banking, before being appointed a director. A source at the bank says Armand has played a pivotal role in managing the bank’s human resources and implementing a philosophy of service and focus on the customer.
Prior to joining BCA he served in several positions within the Djarum Group, including finance director, deputy purchasing director and head of the human resources department. The graduate of Columbia University and Stanford University in the US also worked as an analyst for global credit research and investment banking at JP Morgan in Singapore between 1997 and 1998, before returning home to join the family firm.
Another young gun is Viktor Rachmat Hartono, the eldest son of Budi Hartono. He is responsible for managing the cigarette maker’s operations in Kudus, in tandem with Martin as chief operation officer. He also takes care of the family’s philanthropic activities through Djarum Foundation, an organization that engages in sports, education and environmental awareness programs.
A diversified empire The Hartono fortune comes mainly from the family’s ownership of more than 50% of Bank BCA, with Rp390 trillion in assets posted at its investment arms Alaerka Investment and Farallon Capital by early 2012. Outside the bank, the family also has significant interests in electronics, property, agribusiness, as well as the multimedia sector.
While the group has diversified widely, Djarum continues to produce about 250 billion cigarettes for different brands and controls nearly 20% of the Indonesian market. In the telecommunication infrastructure business, the group controls significant shares in Sarana Menara Nusantara, a publicly listed company which runs, manages and leases some 7,000 telecommunication towers throughout Indonesia. In property, the family owns and manages a number of hotels, shopping centers, trade centers as well as residential developments.
Through subsidiary Inti Karya Bumi Indah the group manages and controls shares in the 220,000 sq m World Trade Center Mangga Dua, one of the biggest wholesale trading centers in Indonesia, as well as the landmark Grand Indonesia, a combination of hotel, apartments, shopping malls and office buildings in a 30-year build, operate and transfer deal with the government.
Hartono Plantations Indonesia manages approximately 100,000 hectares of oil palm in Sumatra and Kalimantan. The sector is on track to become a significant source of revenue in the future, as a result of the family’s partnership with the Wings Group to build an oleochemical plant. In electronics, the group’s Polytron brand is gaining popularity at the lower end of the consumer market, and leads the audio market in its category. Controlling businesses that have continued to thrive since diversification began 15 years ago, the third generation of the Djarum Group, spearheaded by Martin and his brothers, is primed to lead it to greater heights.