International Resource Arbitrage

A business model based on exploiting arbitrage opportunities in Indonesia by acquiring local resources through connections and reselling to international companies at significant markups.

Key Points:

• Core Business Model:

  • Buy local resource rights through local connections and bribes
  • Sell rights to international companies at 10x markup
  • Example: Bought coal rights for $2M, sold pieces for $20M each
  • Amassed $500M over 3 years using this model

• Operational Structure:

  • Used 72 shell companies to obscure ownership
  • Employed multiple executive assistants to handle communications
  • Focused on natural resources like coal that international companies needed
  • Targeted US companies wanting to do business in Indonesia

• Key Success Factors:

  • Leveraged local business culture and practices
  • Built relationships with local officials
  • Understood what international buyers wanted
  • Focused on arbitrage rather than operational expertise

• Risk Factors:

  • Illegal business practices led to jail time
  • Required significant local corruption
  • Operated in legal grey areas
  • Eventually resulted in legal consequences

Note: This business model was described as illegal and resulted in imprisonment. It's included for analytical purposes only.