Micro Small Medium Enterprise (MSME) plays a vital role in a nation’s economic resilience. In Indonesia, during the monetary crisis in 1997-1999, MSMEs saved the economic situation. According to Indonesia Statistic, although post-crisis, the number of MSMEs declined 7.43 per cent, but the contribution of GDP of MSMEs spiked to 52.24 per cent. On the other hand, the export value rose by around 76.48 per cent. At that time, MSME acted as a shock absorber while larger corporations collapsed. 

Fast forward to today, the total MSMEs in Indonesia are still dominating. ASEAN Investment Report 2021 stated that the number of MSMEs in Indonesia was around 65.45 million, the biggest number among other Southeast Asian countries. 

At first glance this sounds like a success story, but the data raises more uncomfortable questions: does quantity still translate to economic growth? Or has the narrative of MSMEs become stagnant, only big numbers but with weak value creation?

When big numbers don’t mean real growth

The dominance of MSMEs is often celebrated as a sign of economic growth. However, most MSMEs in Indonesia remain informal, low in productivity, and highly vulnerable. Many operate without proper bookkeeping, business licenses, or access to formal financing. Indonesia’s Vice Minister of MSMEs, Helvi Moraza, stated that 69.5 per cent of MSMEs are unable to access financing, while 43.1 per cent of them actually require funding to scale up their business productivity.

At the same time, the Financial Services Authority (OJK) reported that MSME Non-Performing Loans (NPL) reached 4.02 per cent in 2024. Based on the credit quality classification above, category four reflects a concerning condition, where borrowers face serious difficulty in predicting repayment and recovery. This figure signals that MSME financing issues are not only about access, but also about sustainability.

Also Read: Why agritech is key to securing long-term food resilience in Indonesia

This situation is driven by multiple structural factors. Cited from Tempo, a joint study by the Mastercard Centre for Inclusive Growth, Mercy Corps, and 60 Decibels identified three main challenges that hinder MSME growth in Indonesia.

• First is the limited capability to operate digital platforms, even when MSMEs are aware of their benefits.
• Second is restricted access to business development services.
• Third is low awareness and weak intention to utilise loans and other formal financial products.

Ironically, business-support platforms and services are already widely available, such as point-of-sale systems, EDC machines, accounting tools, advertising platforms, and digital payment systems. However, most of these services require subscription fees, which MSMEs often perceive as non-essential spending due to limited capital. At the same time, education and socialisation regarding the urgency of these tools remain weak. Government programs such as UMKM Go Digital do exist, but many of them are short-lived. Programs often run for only one to three years before being discontinued, leaving no long-term impact.

Another perspective comes from the National Law Development Agency, which argues that a concrete step to empower MSMEs lies in regulatory reform. Existing regulations need adjustment to reflect current economic and social realities.

This phenomenon resembles an iceberg. What is visible on the surface, large numbers of MSMEs, hides deeper structural problems underneath. Numbers alone mean little without real progress and effective approaches to unlock the actual potential of MSMEs.

Government support: Necessary but not sufficient

The Indonesian government has positioned MSMEs as a national priority. Banks are encouraged to channel financing through programs such as KUR, alongside digital onboarding initiatives, tax incentives, and simplified licensing via the Online Single Submission (OSS) system. These efforts aim to remove administrative and legal barriers. In practice, however, formalisation is often treated as a checkbox rather than a long-term process to upgrade MSMEs into sustainable businesses.

Most policies focus heavily on onboarding MSMEs into the formal system, while paying less attention to maintaining progress, upgrading capabilities, and evaluating outcomes based on clear performance indicators. In reality, MSMEs require continuous guidance to improve productivity, management capacity, and market positioning.

Also Read: Indonesia courts Nvidia and AWS as it eyes a bigger role in global chip supply chains

Without parallel support in productivity improvement, managerial skills, market access, and technology adoption, formalisation risks becoming symbolic rather than impactful.

Is formalisation the right lever?

Formalisation is often positioned as the key to unlocking MSME growth. Once registered, MSMEs are expected to gain access to financing, enter formal markets, and manage their businesses more professionally. Theoretically, this logic sounds legit. In practice, it is incomplete. Formalisation only works when it reduces friction, not when it creates additional burdens. For many MSMEs, formalisation feels intimidating, leading them to remain informal despite potential benefits.

A study by Dr. Shova Thapa Karki and Professor Mirela Xheneti from the University of Sussex found that business formalisation is influenced by whether entrepreneurship is driven by necessity or opportunity. Necessity-driven entrepreneurs are often shaped by structural constraints such as unemployment, poverty, and lack of alternatives, while opportunity-driven entrepreneurs pursue growth, independence, and long-term value creation.

This distinction closely reflects the Indonesian context. Most MSMEs operate primarily to meet basic needs rather than to scale their businesses. This is largely due to the dominance of micro-level enterprises. According to the Indonesian Chamber of Commerce and Industry (KADIN), micro enterprises, both in the agriculture and non-agriculture sectors, account for 99 per cent of total business units. This creates a structural limitation on growth.

An article from The Conversation further highlights that despite their dominance in numbers, micro-level enterprises contribute relatively little to GDP. Their impact on broader economic development remains limited, as business motivation is often individual-driven rather than oriented toward collective or systemic growth.

So, is formalisation the right lever? The answer is conditional. Formalisation can act as a catalyst for access to capital and markets, but it must be supported by a sustainable system. Revising MSME empowerment regulations, strengthening local business communities, implementing continuous monitoring with clear KPIs, and reshaping the perception of financing as an enabler rather than a threat are critical steps. Without these measures, formalisation risks becoming an administrative exercise instead of a pathway toward sustainable MSME growth.

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Across Southeast Asia, I’ve seen how the narrative of innovation often revolves around billion-dollar valuations and high-velocity startups. Yet behind those headlines lies a quieter truth: most of the region’s real economic energy still comes from small and midsized enterprises. The manufacturers, logistics operators, and service providers that keep our cities running.

And it’s precisely these businesses that I see struggling to be heard.

Traditional credit systems still ask SMEs to fit narrow definitions of “bankable.” Venture funds, meanwhile, chase disruption but often overlook durability. Somewhere in between lies the real economy, asset-rich but liquidity-poor, growing but unseen.

The question isn’t whether these firms deserve capital. It’s whether today’s capital still knows how to listen.

From speed to structure

Over the past few years, I’ve watched funding in Southeast Asia grow more polarised. Late-stage deals have surged, but seed and early-stage funding have contracted sharply. The pattern suggests a market that values maturity over momentum, yet it also reveals how little structural support exists for SMEs that never fit the startup mould to begin with.

What these businesses need isn’t another “growth story.” They need financing that aligns with the rhythm of their operations, loans that move with inventory cycles, repayment terms that reflect market volatility, and investors who understand that resilience sometimes matters more than returns.

In my view, the real innovation isn’t speed. It’s in structure.

Also Read: Revisiting “Something Ventured”: What the birth of venture capital still teaches Founders today

The missing ingredient: Trust

Trust may be the least analysed variable in private capital, yet I believe it underpins every successful transaction.

In emerging markets, where data can be patchy and legal frameworks uneven, relationships still matter more than algorithms. Financing models that embed trust, through transparent governance, local presence, and shared accountability, often outperform those that rely solely on credit scores or valuations.

That doesn’t mean abandoning rigour. It means recognising that rigour itself can take different forms: a business owner’s track record, a community’s reputation, or an asset’s proven utility. In many cases, I’ve found that these informal signals of credibility are more predictive of repayment than any spreadsheet.

The capital that listens pays attention to those signals.

Designing for reality

I’ve come to view finance not just as a product, but as a design exercise. We need to prototype new structures, revenue-linked models, milestone-based repayment, or collateralisation through non-traditional assets that mirror how real businesses actually operate.

This is what I call governed capital: money deployed with both structure and empathy. Responsible lending isn’t about avoiding risk; it’s about understanding it. It’s about designing financial systems that reflect the lives and cycles of those they serve, rather than forcing businesses to contort themselves to qualify.

Beyond ESG: Building systems that endure

Much has been said about “impact investing,” but I’ve often seen the region treat it as an aesthetic, a badge of responsibility rather than a redesign of intent. Real impact investing must be slow capital: patient, cyclical, and local.

It should finance the middle of the market, the businesses that hire, train, and sustain, not only those that promise exponential growth. And it should measure success in systems built to endure market shocks, not in exits achieved before the cycle turns.

Also Read: Grants are not just for nonprofits: Why for-profit operators miss out on early-stage capital

That philosophy demands more than new metrics. It demands new mindsets from investors, regulators, and entrepreneurs alike.

What comes next

If Southeast Asia’s next decade is to be defined by capital that listens, I believe a few principles can guide the way forward:

• Local fluency over global templates. Effective capital requires proximity to markets, to culture, and to people.
• Governed flexibility. Rules and empathy are not opposites; they are co-designers of trust.
• Measured ambition. Growth that compounds slowly is often the kind that lasts.

When finance learns to operate at a human scale, SMEs cease to be an afterthought. They become the architecture of regional resilience, proof that in an age of noise, the most transformative capital may be the kind that moves quietly, listens deeply, and stays long enough to matter.

—

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Bitcoin faces a multi-day losing streak that analysts identify as the harshest reset since past major bear markets. The asset peaked above US$100,000 in October 2025 before falling roughly 50 per cent to the mid US$60,000s. A sharp flush to about US$60,000 on 5 February triggered heavy forced selling and extreme options demand for downside protection.

Volatility and derivatives stress levels are at levels last seen during the FTX era and the 2018-style resets. On-chain and valuation metrics have shifted into early bear-market territory. Sentiment sits near extreme fear, with the Fear & Greed Index at 6. This reading marks the second-lowest ever. Key support zones now focus around US$60,000 and roughly US$55,000. Investors watch ETF flows and whether on-chain composite indices recover or slide further toward full capitulation zones.

The streak reflects broad de-risking across spot, derivatives, and ETF flows after a very extended bull run. Analysts at K33 and Bitcoin Magazine describe capitulation-like conditions in volume, funding, and options skew as BTC approached US$60,000. Daily RSI sits near 16. US spot Bitcoin ETFs have seen around US$400 million in weekly net outflows.

A big drop in assets under management from a 2025 peak has removed an important source of incremental demand. This data suggests the market struggles to find buyers at current levels. The structure looks more like the early part of a bear phase than a brief correction. This implies longer, choppy sideways to down price action appears likely.

CryptoQuant’s Combined Market Index blends valuation, profitability, spending behaviour, and sentiment. This index dropped to around 0.2. Analysts linked this zone to the early stages of the 2018 and 2022 bear markets rather than a mid-cycle dip. A separate heatmap of 10 major on-chain metrics shows all key signals in the red band. These signals include trader profit margins and network activity. Conditions remain inconsistent with new highs in the short term.

Realised price tracks the average cost basis of all BTC. This metric currently stands at around US$55,000. Past cycle lows have often formed 24 to 30 per cent below it. This places a potential high-risk, high-reward zone around that area if history repeats. Analysts flag US$60,000 to US$62,000 as a critical support band. K33 work suggests consolidation between roughly US$60,000 and US$75,000 now forms the base case. Deeper downside awaits if US$60,000 fails.

Also Read: Crypto market bleeds US$44B as US$78M Bitcoin liquidations spark panic

Broader market context adds weight to this cautious outlook. Major US stock indices ended slightly higher on February 17, 2026. The session saw the S&P 500 swing between gains and losses as investors grappled with persistent fears regarding AI expenditures. The S&P 500 rose 0.1 per cent to close at 6,843.22. It found support near its 100-day moving average after an initial drop of nearly one per cent.

The Nasdaq Composite gained 0.14 per cent. The Dow Jones Industrial Average climbed 32.26 points to settle at 49,533.19. Financials and real estate each rose approximately 1.1 per cent. In contrast, the energy sector fell 1.4 per cent, and consumer staples dropped 1.5 per cent. General Mills sank seven per cent after cutting its annual outlook. The technology-heavy Nasdaq faced pressure from a 2.2 per cent drop in software-focused ETFs.

Commodities signalled risk-off behaviour. Gold prices plummeted more than two per cent. Prices fell below US$5,000 to settle at around US$4,884 per ounce. Oil prices dropped roughly two per cent to a two-week low. Brent crude settled at US$67.42 and WTI at US$62.33. Reports of a new window of opportunity for a potential nuclear deal reduced safe-haven demand for gold. This also lowered the risk premium on oil. AI anxiety triggered a bout of volatile trading.

Scepticism about tech giants’ ability to monetise their high AI expenditures worried investors. Dip buyers helped indices recover by the close. Liquidity remained thin following the US Presidents’ Day holiday and ongoing Lunar New Year closures in China and Hong Kong. The 10-year Treasury yield edged up slightly to 4.06 per cent. The 2-year yield rose to 3.439 per cent.

Also Read: Markets in freefall: AI fears trigger US$4B Bitcoin ETF exodus

My view synthesises these disjointed signals into a coherent narrative. The Bitcoin reset aligns with broader macro uncertainty. While stock indices closed slightly higher, the underlying volatility suggests fragility. The drop in gold alongside Bitcoin indicates a liquidation of safe havens rather than a rotation into risk. The US$400 million weekly ETF outflows confirm institutional hesitation. Investors need multiple consecutive days of strong inflows to reset the current bearish regime. The realised price near US$55,000 offers a logical floor, yet history suggests prices could dip 24 to 30 per cent below this level.

The BCMI at 0.2 reinforces the bear market comparison. Traders should focus less on picking an exact bottom. Focus remains on whether US$60,000 and the realised price hold. ETFs and on-chain signals must stabilise before optimism returns. The current environment demands patience as the market searches for a true bottom amidst economic crosscurrents.

AI scepticism in equities and crypto derivatives highlights shared sensitivity to liquidity conditions across asset classes. This parallel suggests that the crypto downturn is not isolated from traditional finance movements. Investors observe that doubts about technology expenditure in the stock market mirror the de-risking seen in Bitcoin derivatives.

Both markets react sharply to changes in yield expectations and risk appetite. The 10-year Treasury yield edged up to 4.06 per cent, adding pressure to valuation models for high-growth assets. Higher yields typically reduce the present value of future cash flows for tech firms and diminish the appeal of non-yielding assets like Bitcoin. This correlation strengthens the argument for a cautious approach until yields stabilise.

Nevertheless, the path forward involves navigating choppy sideways action until clear recovery signals emerge.

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The Tokyo Metropolitan Government has announced that SusHi Tech Tokyo 2026 will take place from April 27 to April 29 at Tokyo Big Sight, positioning this year’s edition as its most ambitious yet. Now in its fourth year, the conference has grown into Asia’s largest global innovation gathering, and organisers are aiming to further elevate it as a worldwide platform where innovators converge to design the cities of tomorrow.

Short for “Sustainable High City Tech,” SusHi Tech Tokyo was conceived as a forum to envision, debate and implement future societies shaped by advanced technologies. Over the years, it has evolved into a comprehensive program of intensive sessions, live demonstrations and startup showcases. In 2026, the event will expand both in scale and global reach, welcoming participants from across industries and geographies to experience not only frontier technologies but also Tokyo’s unique cultural and urban strengths.

This year’s programme centres on four key areas: AI, Robotics, Resilience and Entertainment.

AI takes centre stage as a transformative force reshaping industries, work styles and the nature of innovation itself. Leaders from pioneering companies and renowned research institutions will explore how humans and AI can collaborate to build more inclusive and productive societies. The event will feature an AI-focused startup exhibition highlighting university and research spin-offs from across Japan, alongside a pitch contest and partner screenings of award-winning works from an international AI film festival.

Robotics will showcase the rise of “physical AI,” as intelligent machines become more deeply integrated into daily life. Demonstrations will spotlight robots performing a range of tasks designed to enhance convenience, productivity and quality of life, signalling how automation could address labour shortages and demographic shifts.

Also Read: The US$71000 Bitcoin bounce lacks foundation but Japan’s rally has real teeth

Under the resilience theme, SusHi Tech will present technologies to strengthen cities against natural disasters and climate-related risks. Exhibits will focus on earthquake preparedness, flood mitigation and rapid recovery systems.

Attendees can also join site tours of Tokyo’s critical infrastructure, including vast underground flood-control reservoirs that protect the metropolis from river overflows.

In entertainment, the event will explore how technology is reshaping creative industries spanning anime, manga, music and sports. Beyond the main venue, partner events across the city will invite global visitors to engage with Tokyo’s cultural landscape, including a walking event along the KK Line, an elevated expressway undergoing a transformation into a pedestrian space.

SusHi Tech Tokyo 2026 is also set to attract a record number of startups. More than 700 companies from around the world will exhibit, up from 607 last year. The global pitch contest, SusHi Tech Challenge 2026, will see 20 finalists selected from 820 applicants across 60 countries and regions.

A new initiative, “SusHi Tech Global Startups,” will provide intensive support to growth-stage companies through collaboration between the Tokyo Metropolitan Government and ecosystem partners.

Global investors will take the stage to share insights into Japan’s startup landscape and evolving investment strategies, with open meetups designed to facilitate direct engagement.

The conference will also spotlight Japan’s top university startups, innovative SMEs from across the country and student-led initiatives such as “ITAMAE,” where students independently plan sessions and support overseas founders.

With tickets now on sale, including discounted early-bird passes until February 28, SusHi Tech Tokyo 2026 is shaping up not only to be a showcase of emerging technologies but also a statement of Tokyo’s ambition to lead in building sustainable, human-centric cities for the future.

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Image Credit: SusHi Tech 2026

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OpenClaw has been circulating heavily across tech Twitter and developer communities. Agentic AI. Autonomous assistants. AI that “actually does things”.

The narrative is seductive: AI that doesn’t just respond, but acts. Check your inbox. Runs scripts. Controls systems. Executes workflows. It feels like a glimpse into the future. And in many ways, it is.

But the more important question isn’t whether OpenClaw is powerful. It’s whether power alone is product-market fit.

Infrastructure always comes before interface

Every technological shift follows a pattern. Infrastructure comes first. Interface comes later. Mass adoption follows usability. Monetisation follows adoption.

Linux preceded macOS. Terminal preceded GUI. Self-hosted email servers preceded Gmail. Open-source wallets preceded consumer crypto apps.

OpenClaw sits firmly in the infrastructure phase of agentic AI.

It validates something important: Autonomous AI agents are not theoretical anymore. They are technically viable. That matters. But viability and usability are two different markets.

The installation reality

I tried installing OpenClaw myself.

It took me minutes.

But that is because I have a technical background. I understand environments, configurations, system permissions, and hosting layers. I am comfortable unpacking files and troubleshooting.

Now imagine:

• A small business owner.
• A marketing lead.
• A 50-year-old founder.
• A creator trying to automate workflows.

Would they self-host? Configure execution permissions? Think about security boundaries? Debug dependency issues?

Unlikely.

This is not a criticism of capability. It is segmentation.

OpenClaw is designed for users who are technically equipped to operate infrastructure-level systems.

That is a niche. And niches are powerful, but they are not the mass market.

Also Read: Generative AI fatigue: Are we over‑automating creativity?

The product-market fit gap

Much of the public discourse makes it sound as if agentic AI is ready to replace assistants tomorrow.

But product-market fit requires more than technical capability.

It requires:

• Frictionless onboarding.
• Clear guardrails.
• Invisible hosting.
• Managed security.
• Defined execution boundaries.
• Support for non-technical users.

Power excites technologists. Simplicity converts markets.

If a user cannot install, configure, and confidently manage a system, adoption slows. And when adoption slows, monetisation follows.

The total addressable market for developer-grade AI is not the same as the total addressable market for consumer-grade AI. And that distinction matters for founders building in this space.

Infrastructure is step one, not the finish line

OpenClaw is not the problem.

It is proof.

It proves agentic AI is real.

But infrastructure alone does not create scale.

Someone will productise this layer. Someone will abstract the complexity. Someone will build guardrails by default. Someone will turn it into something that feels like using an app instead of running a server.

That is when adoption widens.

A case study in evolution

Before Seraphina became a consumer-facing AI assistant, she was my internal system. Powerful. Flexible. Built for me.

If I had released that early version publicly, adoption would have been zero. Not because it lacked capability. Because it required too much configuration.

I understood the parameters. I defined execution rules. I knew where clearance was required. I knew what she should and should not automate. Most users don’t have that clarity yet. So we simplified. We added guardrails. We reduced friction. We abstracted complexity. We made hosting invisible. We prioritised usability over raw power.

The ideology remained the same. The interface changed. That difference is product-market fit.

Also Read: AI in action: How governments are using technology to predict, prevent, and personalise

Automation without process clarity is risk

There is another layer most hype cycles ignore: governance. Agentic AI that can execute commands introduces operational risk if boundaries are unclear.

If someone doesn’t understand:

• Their workflow.
• Their approval layers.
• Their data movement.
• Their access permissions.

Then full autonomy becomes fragile.

In my own systems, certain actions require explicit clearance. Automation only works safely when processes are clearly defined.

This is why I often say: Automate when you know your process. If the process itself is unclear, automation amplifies confusion. Security risk and process ambiguity become friction points — not growth accelerators.

Not everyone needs to learn everything

There is also a broader founder lesson here.

I recently built a full system using Vibe Coding in under an hour. I signed up and executed immediately.

Others have taken courses on similar concepts and still haven’t built anything.

This is not about intelligence. It is about exposure, comfort, and alignment. Just because a capability exists doesn’t mean everyone must master it.

I cannot run a hawker stall or a beauty salon efficiently. That doesn’t diminish my ability. It means my skill set lies elsewhere.

In every tech wave, there are:

• Builders (infrastructure experts)
• Translators (product and interface designers)
• Users (operators and businesses)

All roles are valid.

And if you’re stepping into deep technical territory, one of the smartest moves is not learning everything yourself, but partnering with someone who already speaks that language.

When I entered education, I partnered strategically. It reduced friction. It accelerated execution. It saved time.

Time is the real currency in technology cycles.

The shortcut is not omniscience. The shortcut is access to experience.

The adoption curve is always slower than hype

Social media compresses perception. When everyone talks about a technology, it feels ubiquitous. But conversation does not equal penetration. OpenClaw excites technologists. Agentic AI excites futurists. Investors see long-term potential.

But mass-market adoption follows a different curve. Infrastructure. Abstraction. Interface. Trust. Then scale.

OpenClaw is step one.

The revolution is real. But revolutions rarely become mainstream overnight.

The opportunity is real — participation is optional

Agentic AI will reshape workflows. Autonomous assistants will become normal.

But not every founder needs to install infrastructure. Not every operator needs to configure agents. Not every business needs to self-host. Some will build engines. Some will productise them. Some will simply use them.

Powerful technology is not automatically mass-market technology.

And that’s not a flaw. It’s a phase.

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Editor’s note: e27 aims to foster thought leadership by publishing views from the community. Share your opinion by submitting an article, video, podcast, or infographic.

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