Indonesia

The Mystery of Loewy's and Indonesia's Lack of a Brain Drain

I am writing this from one of my least favorite places in the Jakarta-- the Soekarno Hatta International Airport. Almost a year ago I was on my last leg of travel for my book and my health, stamina and bank account were all running on fumes. I spent a brutal nine-hour layover in this airport, most of it slumped in a chair at Starbucks, half-stricken with a fever, my nose raw from blowing it on cardboard-like napkins watching the only thing I had downloaded on my iPad-- America's Next Top Model. (Don't judge.) The minutes seemed to go in reverse, and I spent most of the time trying not to cry or pass out. I vividly remember it every time I'm here. 

My loathing of this airport stands out because there are so many places in Jakarta I adore, and I'm sad I didn't get to spend more time here on this trip. Most of them have to do with food, and conversations with entrepreneurs I've had around that food. There's Bandar Djakarta-- the huge restaurant in Ancol that's a cross between an Indonesian Chuck E. Cheese and a Fudruckers in a beach town like Panama City.

Any live seafood you can imagine-- and some so prehistoric looking you're not sure how they still exist- can be found in Bandar Djakarta's coolers. You point to the ones you want, loosely describe how you want it cooked, then wedge in at one of the long tables where middle class Indonesians come to celebrate their birthdays. A jazzy version of "Happy Birthday to You" plays in Bahasa about twenty or thirty times a night.

There's Pondok Laguna-- yet another seafood place where I usually order at least six things, all of them as spicy as they'll possibly give an American. My first time there I wondered how to break into the crab without crackers, when I looked over and saw an old Chinese man, stone-faced, smashing his mug of Bintang on the crab like a WWF wrestler doing a body slam.

Laguna is open-air and cavernous, loud, steamy and full of sprawling Indonesian families enjoying a night out together as kids run between tables. They fully expect you to make a pig of yourself-- the tables aren't bussed once you're done, as much as waiters take the scraper-side of a long carwash squeegee and slide everything on the table into huge tubs. The squeegee is flipped around, and voila! The table is mopped down and ready for the next diners.

And during this trip, I had a meal that rivaled both of those in Makassar. At an unassuming spot, we were served beef spare ribs slow-grilled to perfection out on the busy market street and slathered with a complex, spicy peanut sauce. We gnawed on the bones like rabid animals, using our fingers and the rice to sop up an even more tongue-numbingly spicy peanut sauce.

I love the full sensory experience of Indonesian food-- the sticky mess, the taste, the smell (unless Durian is involved) and of course the tingling burn in my mouth from the spice once I'm done. It's the only country in the world where I can't figure out what in the hell could be in the sauces making them so complex, layered and unlike anything I've ever tasted. Indonesia is home to more indigenous herbs and spices than any place in the world, and yet, I'm convinced they've held some back for their own cooking that the rest of the world has never heard of. A sort of revenge for 350 years of Colonialism, spurred by that same bounty of spices. 

But one of my favorite places in Jarkarta is called Loewy's, and it isn't authentic at all. If you've been to Pastis in Manhattan, you've essentially been to Loewy's-- at least structurally. There are some Indonesian-inspired touches-- like the Tom Yum Martini and flavorful rice dishes. But there's no denying that Loewy's is pretty Western.

I used to feel guilty about liking it so much. You never want to be the American going to an American place in a country like Indonesia where the local dining experience is so rich. But I couldn't help it. There is something infectious about Loewy's. The atmosphere is hopeful and electric, and yet, it's comfortable and familiar. It's one of those places I could sit in all day reading a book or working on a blog post and never feel pressured to leave.

More than that, there was always something I couldn't explain about it. Somehow, it doesn't feel like an expat-haven, although there's a feeling of being amid a group of people who don't quite fit; people seeking sameness in a strange place. But that just confused me more, because Loewy's is usually filled with hip, affluent Indonesians, not Westerners.

It all made more sense to me once someone explained that Loewy's isn't owned by Americans-- it is actually a local place. It was opened by some Jakarta kids who studied in the US and loved Pastis. When they came back home they wanted to take a piece of that, so they recreated it Indonesia-style.  It explains the strange expat vibe: Not only are there Americans like me going to Loewy's to feel a bit of the West-- but Indonesians who used to live in the US are going there for the same thing. Even though we're from different places, the Americans and Indonesians in Loewy's are all trying to get a sense of home and a sense of exotic at the same time. In my case, it's just reversed from those I'm dining with. Put another way, some of the diners in Loewy's are actual expats and some go there to pretend they are again. 

I haven't found a place like this anywhere else in the world. Most expat bars and restaurants are pure-expat with locals and people wanting to mix with locals turning their nose up at the idea of them. Then there are the TGI Fridays and Chilis that dot the emerging world. In my experience, these are mostly frequented by locals, fascinated with the exoticness of Americana, but few actual Americans go there. But a place like Loewy's that's somewhere between the two, filling the need for both groups is unique.

It makes more sense once you understand the typical Indonesian who studies in the US. More often than not, these are sons and daughters of Indonesia's wealthiest industrial families. They get to study in America, and the lucky ones get a bit more time to play around in cities like New York and LA post graduation. But "the call," as they refer to it, always comes eventually.

The family tells them on "the call" that the fun is over, and it's time to come home and be groomed to take over the family business. Some look forward to coming back, but most wish they could stay longer. But almost all of them uphold the families' wishes. That was-- after all-- the terms under which they got to study in the US to begin with. 

This isn't just anecdotal. While it's all but impossible for Indians to get granted US student visas these days, Indonesians get approved at a rate north of 85%, according to the Embassy folks I traveled with for the last two weeks. "It's amazing," I was told. "They just never overstay."

That helps explain the puzzling lack of Indonesian restaurants in the US, since Chinatowns and Little Italies sprung up as a way for immigrants to build a business and replicate some sense of home. It has also lead to yet another phenomenon that makes Indonesia unique for an emerging market: It hasn't had a brain drain to the West. The kind of reverse brain drain that we're now fretting about with India and China-- where people study in the US but go back home to build companies-- has long been happening with Indonesia. But is that a good thing or a bad thing for the Indonesia? I could argue both sides. 

On the downside, it's another reason that Indonesia-- its population, its natural resources, its potential--  is such a well kept secret, because you don't have a diaspora out evangelizing it. India's huge population aside, one of the biggest reasons so much capital flows from Silicon Valley is because Indian entrepreneurs have made such stellar entrepreneurs here. People feel like they have reference points and cultural bridges. The lack of Indonesian reference points hurts the flow of foreign capital-- especially given the insane amount of opportunities to invest in the emerging world. Best case: Indonesia is simply not top of mind. Worst case: The lack of these "cultural ambassadors" can reinforce negative stereotypes, like the idea that Indonesia has a more radical Muslim population than it does. 

On an individual level, successful expats who spend time in the west develop marketable skills necessary to bridge the two markets from an operational standpoint. And of course many expats can achieve greater success in the West, leading to a flood of remittances coming back home, enriching family members. 

But there's an upside for Indonesia too: The best educated Indonesians almost always return home, reinvigorated with what they've seen in the US, whether it's the entrepreneurial spirit of Silicon Valley, the glamour of LA or the style of New York. They don't seek to replicate it, but longing for it, they build things like Loewy's that combine the two cultures. Rather than building a piece of home in the US-- ala Chinatown-- these Indonesians build a piece of the US at home. 

The brain-drain debate is a bit like the catch-22 of multinationals. Western companies can provide a quick-fix for an economy when they charge in and offer thousands of highly-skilled, high-paying jobs. But as we've seen in India, multinationals only help the small percentage of people who are lucky enough to land those jobs. Building a creative-class of local entrepreneurs takes far longer, and requires government and private sector coordination that's lacking in many emerging markets. But it's the only sustainable way to transform an economy in the long term. So too, might the lack of a brain drain hurt Indonesia in the short term, but prove and advantage in the long term. It's all up to these kids trapped somewhere between a native and an expat in their own homeland.

Two weeks ago, I spoke at a dinner of US alumni in Surabaya. I was told the audience represented most of the money in the second largest city on the island of Java, and most of them had lived the story above. They spoke flawless English and had many of the earmarks of being American-educated. But as I looked over the audience it was unmistakably Indonesian. No Western brands here; it was a sea of the same Batik shirts their parents and grandparents had worn at formal events before them. Like Loewy's, the conversations about global business made me feel at home, and yet, looking around, I was still clearly in Indonesia. 

While I've never been a big believer that trustfund kids change the world, I've become convinced that this frustrated generation will be pivotal to what happens to Indonesia next. Unlike their parents, they've spent time in the West and if they can't stay, there are parts of it they plan on bringing home with them. Unlike Americans seeking to profit from Indonesia's growing middle class, they get the country. But unlike many Indonesians, they get what modernization and technology can make possible.

It's not just Loewy's-- many of these kids are angel investing in Web startups following models they saw in the West. They may not be free to run them, but they can fund someone who can. Many of them are pushing the government to improve Indonesia's infrastructure or forming powerful private sector coalitions that can make changes faster than the government. Some may well run for office one day. If they're forced to come home, they're determined to make life in Indonesia better. And better doesn't just mean Western -- it means a modern Indonesia. 

Comments

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Excellent writing, Sarah!

One big difference in these Indonesian kids vs the Indian kids who come to the US, is as you mentioned it, scions of rich Indonesian families. They are expected to take over and continue to build upon the mini-business empires started by their great-great-great-to-the-power-X of God-knows-what grand pappies.

Whereas for the Indian kids, unless they r from the Ambani or Reliance families, they have nothing. Zero. Zilch. Nada. In a way, they are trying to be self-made men/women/individuals who dont have much back in their Indian hometowns. In a way, they may have more freedom but of much higher-risk (for failure or dead-end-jobs-inertia-fate-in-tech jobs) in their future life paths than their Indonesian counterparts.

Wow, I couldn't agree more.

Indonesia is walking a pace or two behind China, obscured in the shadow of their big Asian brother. While China reached the mystical $US3,000 per capita GDP middle class threshold around 2008-09, Indonesia will supposedly hit that level at the end of this year.

If what played out in Korea/China is true, then college-educated, rich young Indonesians are well placed to reap the fruits of the coming consumer boom.

An ex-McKinsey friend got 'the call' two years ago and is modernizing the family business. Another friend, son of an Embassy official, returned earlier this year and is now working on a Blackberry mobile app. I've heard dozens of other similar stories of kids opening trendy Western-style bars, cafes and restaurants...

Good times ahead!

wow..nice one. I love it. Thanks to wrote about Indonesia from different perspective, and the one that I love..Indonesian Food.

Let the world knows that we're not only BALI Island, and we're not scary place to go, and we're extremely Beautiful :)

cheers..

Hi Sarah,
Many Indonesian people who studied in US are lecturers or researchers. It's also true that a large number of people are son or daugther of wealthiest families in Indonesia. The first group have to go back to Indonesia because they are employee of institutions. As Indonesian I personaly think that even million of Indonesian work in Sillicon Valley and then come back they will not make difference but if the goverment servant (staff) temporary stay and work in US goverment and then come back, it will make the differences.

Cheers

@ Sang-- you make a great point. the advantage of having nothing to lose is one of the biggest you can have as an entrepreneur.

@lucasng-- i didn't know indo was supposed to pass that mark end of this year, but you can sense it. jakarta changes the most between each visit of anywhere in the emerging world right now-- at least that i've been to. it is really on the cusp, in my opinion.

Good writing Sarah, you're spot on with your analysis.

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Sarah Lacy is an award-winning reporter who has covered high-growth entrepreneurship for more than fifteen years. She is the founder, CEO and Editor-in-Chief of PandoDaily.com, the site-of-record for the startup ecosystem. She lives in San Francisco.

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