Indonesian agritech startup eFishery, once a celebrated unicorn in the aquaculture industry, is facing a dramatic downfall. The company has announced layoffs affecting over 1,000 employees—approximately 90% of its workforce—and is considering liquidation amid allegations of financial fraud. This marks a sharp reversal for a startup that was valued at $1.4 billion and backed by prominent investors such as SoftBank and Temasek.
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Key Developments
Massive Layoffs
eFishery’s workforce, previously numbering around 1,600 employees, is being reduced by more than 90%. The layoffs have already begun, and further reductions are expected.
Fraud Allegations
An internal board investigation revealed that eFishery may have inflated its revenue and profit figures by as much as $600 million in the first nine months of 2024. This alleged financial misconduct accounted for over 75% of the reported numbers during that period.
Potential Liquidation
The company is weighing options including liquidation or restructuring. An adviser has recommended that investors make a decision on the company’s future soon, with liquidation being a likely outcome.
Impact on Indonesia’s Startup Ecosystem
eFishery’s collapse comes as a significant blow to Indonesia’s burgeoning tech ecosystem, which has been striving to attract global investors. The scandal undermines confidence in local startups and raises concerns about governance and transparency.
Background on eFishery
Founded in 2013 by Gibran Huzaifah, eFishery aimed to revolutionize Indonesia’s aquaculture industry through technology. The company developed IoT-enabled smart feeders for fish and shrimp farmers, along with a platform offering feed supply, financing, and market access. By 2023, it had served over 30,000 farmers across Indonesia and expanded internationally, including into India. Its solutions were lauded for improving productivity and reducing costs for small-scale farmers.
eFishery achieved unicorn status after raising $200 million in a Series D funding round in 2023. It was hailed as a transformative force in aquaculture, contributing significantly to Indonesia’s GDP in the sector.
The Fallout
The fraud allegations have tarnished eFishery’s reputation as a pioneer in agritech. Investors such as SoftBank and Temasek now face significant losses, while the broader Indonesian startup ecosystem grapples with the fallout of this high-profile failure2. A trade union organized by employees is reportedly pushing back against the mass layoffs and advocating for the company to continue operations.
Conclusion
eFishery’s rapid rise and dramatic fall highlight both the potential and risks of tech startups in emerging markets. While its innovations brought substantial benefits to aquaculture farmers, the alleged financial mismanagement underscores the need for stronger corporate governance and transparency in scaling startups. The company’s fate—whether liquidation or restructuring—will likely serve as a cautionary tale for investors and entrepreneurs alike.