The announcement that the group controlled by presidential candidate Aburizal Bakrie had taken a stake in fast-growing tech platform Path met with a predictably mixed reaction among Indonesian social media users over the weekend.
The website recode.net reported on Friday that San Francisco-based Path collected a total of $25 million in new investment through its recently closed Series C funding round, which brought the company’s total funding to $65 million. The value of the Bakrie Group’s stake was not disclosed.
Bakrie Group CEO Anindya N. Bakrie confirmed the report on his Twitter account @anindyabakrie,
“We’re only a small part of many investors in @path,” Anindya tweeted on Saturday. “The [capital injection] is part of efforts to make Indonesians more connected and productive, considering that we’re one of biggest users of @Path.”
“We also call for Indonesians, especially young business people, to take part in the development of the sci-tech industry and global networking.”
The news of the Bakrie investment came two months after Path founder and CEO Dave Morin visited Indonesia in November.
In an interview with Indonesian news portal vivanews.com, which is part of the Bakrie Group, Morin said Indonesia was a vital market for Path. Indonesians were the social network site’s “No. 1 user,” he said.
There were around 4 million Path users in Indonesia — out of around 20 million users worldwide — and the figure continued to grow, according to Morin.
Indonesia was the source of as much as one third of Path’s monthly traffic, he added.
While some social media users saw the news as a tentative but promising entry for Indonesian business into an industry whose roots remain firmly planted in Silicon Valley, others greeted the announcement with suspicion.
The Bakrie Group has fielded criticism from many quarters in Indonesia since a gas-drilling project by subsidiary PT Lapindo Brantas ended in disaster in Sidoarjo, East Java, in 2006.
On May 26, 2006, a gas well drilled by the company blew out, resulting in the creation of the world’s largest mud volcano. The flow is not expected to cease for another 25 years and, while the mud has been contained by several levees, it continues to cover 10,000 homes over some 70 hectares.
Several studies have shown that the responsibility for the disaster was with the company, while Aburizal Bakrie, who was a government minister at the time, maintained that a nearby earthquake triggered the blowout.
Compensation claims for many affected residents became stuck in the Indonesian legal system in the years after the disaster, and many people remain angry with the way Bakrie handled the aftermath of the mud flow.
@jalurkanan said, “Playing Path as much as I can, because I will delete this [Path] account. This is all because of Bakrie, who, you know…”
@danmrani tweeted, “BYE BYE PATH. My ex boss at former company had said ‘we dont do biz with Bakrie’. I agreed with him, and still do.”
@ReneCC: “Whoever is running #path is making a blunder by taking in Bakrie”
There were, however, several comments from people who applauded the move into social media — an industry that is used ubiquitously in Indonesia.
“Hmm… Why are people mocking Bakrie for purchasing Path? Shouldn’t we be proud that Indonesians have a stake in a popular social media site…,” @denirumdani said.
San Francisco-based Path was founded in 2010 as a photo-sharing and messaging service. Unlike established social media giants Facebook and Twitter, Path allows its users a maximum of 150 contacts with whom they can interact.
Path is no stranger to controversy itself. In February, 2013, the company was fined $800,000 by the US Federal Trade Commission after it was found to have downloaded users’ phone contacts without permission.