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Singapore Early-Stage Venture Funding

Singapore Early-Stage Venture Funding

If you are planning company incorporation in Singapore or have an existing business on the verge of exploding into a phenomenal growth, Singapore government offers several attractive grants and funding schemes that help grow a business through its various early stages.

In addition to the government support, there are many angel investing networks, venture capital firms, private equity firms, startup incubators and accelerator programs that assist entrepreneurs in raising capital.

Government Schemes

Government agencies in Singapore provide the following cash grants and equity financing schemes to local startups in the country; startups are eligible for these grants and schemes on the basis of qualifying criteria set by the government.

Startup SG

The Standards, Productivity and Innovation Board Spring (SPRING) has consolidated its previous startup assistance schemes under one program which is now called Startup SG. The goal of Startup SG is to provide Singapore-based startups with access to funding sources and mentorship programs and thereby help turn innovative business ideas into thriving companies. Under Startup SG, qualifying startups can access cash grants, equity financing, and business loans. The following provides an overview of the funding programs offered by Startup SG:

Startup SG Equity

Startup SG Equity is an investment fund managed by SPRING Seeds Capital and SGInnovate. Under the Startup SG Equity scheme, the Singapore government will co-invest with 11 private investment partners in startups that require significant capital expenditure and may take longer to be commercially viable.

For startups that are improving existing technologies, the Singapore government will provide 70% of the funding in an initial investment round of S$250K. Thereafter, the Singapore government will invest S$1 for every S$1 invested by private investors up to a cap of S$2 million.

For startups classified as “deep tech”, the Singapore government will provide 70% of the funding in the initial round investment of S$500K.

Thereafter, the Singapore government will invest S$1 for every S$1 invested by private investors up to an investment cap of S$4 million.

The Singapore government describes deep tech companies as developing products based on scientific or technological breakthroughs that are unique, differentiated and hard to reproduce. Typically, the technology a deep tech startup is developing is the result of years of research and lab testing and, requires a longer period to reach market viability.

To qualify for Startup SG, startups must meet the following requirements:

  • Be a Singapore-based company
  • The core operations of the company must take place in Singapore
  • Be incorporated as a private limited company for fewer than 5 years.
  • Have paid-up capital of at least S$50,000.
  • Be able to prove substantial innovative and intellectual property
  • Have high-growth potential with clear ability to scale in the international market.
  • Have identified an independent third-party investor.
  • The business must not be involved in gambling, tobacco-related products, or any other activities which are in violation of law, or against public interest.
  • The company cannot be a subsidiary or joint-venture.

Startup SG Tech

This grant provides project funding for local Singapore companies to develop breakthrough technology that can disrupt current markets or create new markets. With Startup SG Tech, companies will receive funding for both Proof-of-Concept (POC) and Proof-of-Viability (POV) projects. POC projects, which are designed to test the technical and scientific viability of a new technology, can receive funding of up to S$250,000. POV projects designed to test the commercial viability of a lab-proven technology can receive up to S$500,000 in funding.

To qualify for Startup SG Tech, companies must meet the following requirements:

  • The company must be a registered Singapore company less than 5 years old
  • The company must operate in Singapore
  • The company must have at least 30% local shareholding
  • Annual revenue must be less than S$100 million or the company must employ fewer than 200 people
  • Startup SG Tech offers cash grants to companies in the following industries:
  • Advanced manufacturing and robotics
  • Biomedical sciences and healthcare,
  • Clean technology (e.g. waste management solutions, sustainable energy generation)
  • Information and communications technologies
  • Precision engineering (e.g. composite technology and silicon photonics technology)
  • Transportation technology
  • Food science and technology

Startup SG Founder

The scheme was developed for new entrepreneurs with innovative businesses. Startup SG Founder provides up to S$30,000 by matching S$3 to every $1 raised by the startup. Along with funding, entrepreneurs also receive mentorship and business guidance from Singapore-based incubators. The program is open to Singapore citizens and permanent residents. To be accepted into the Startup SG Founder program, first-time entrepreneurs must apply through an Accredited Mentorship Partner (AMP); these include:

Action Community For Entrepreneurship (ACE) works with startups working in all sectors.

Advanced New Technology Incubator works with startups specializing in hardware, robotics, and automation.

FocusTech Ventures works with startups in IoT, advanced manufacturing, robotics, AI, and AR/VR.

JCS Venture Lab works with startups in advanced manufacturing and engineering.

Nanyang Technological University works with startups in advanced manufacturing and engineering, health and biomedical sciences, urban solutions and sustainability, services and digital economy.

NUS Ventures works with startups in IoT, AI, fintech, hardware, and software.

Singapore Management University works with startups in fintech, cybersecurity, data analytics and artificial intelligence, Smart City innovations, transportation, and logistics.

QuestVC works with startups in e-commerce.

Spaze Ventures works with startups financial services, fintech, healthcare, education, e-commerce, logistics, big data, enterprise solutions and IoT.

Joint Polytechnic Incubator Initiative works with startups in general tech.

TNB Ventures works with startups in IoT, AR/VR, robotics and AI.

Trendlines Medical works with startups creating medical devices and medical technology.

TRIVE Advisory works with startups in deep tech (cloud computing, data science, fintech, agritech, recycling tech, AI, blockchain, cybersecurity,energy, emissions, food science, healthcare tech, IoT, material sciences).

August Global Asset Management works with startups in fintech, security, medical technology, education technology, agriculture technology, and big data.

BWG Services works with startups working in all sectors.

ETPL works with startups specializing in deep tech (medtech, biotech, advanced manufacturing including robotics, digital technology including analytics and AI,electronics data system /IoT).

Found works with startups working in all sectors.

Sifood works with startups specializing in agriculture technology, food technology, clean technology, healthcare.

Singtel works with startups committed to making a positive environmental and social impact.

Budding Innovations works with startups specializing in digital health, diagnostics, food, nutrition, lifestyle technologies, medical technology, clean technology and advanced materials.

ImpactTech works with startups working in all sectors.

Mencast Innovation Centre works with startups specializing in nanotech, energy technology, industrial IT, life science and agriculture science.

Techstars works with startups in social messaging tech (bias towards Viber app).

Startup-O works with startups in AI, fintech, consumer technology, medical technology, IoT, SaaS.

Cheng Yew Heng Candy Factory works with startups in food technology & manufacturing.

ST Engineering – Innosparks works with startups focusing on smart cities and healthcare.

Mistletoe Singapore works with startups in preventive medicine and sustainability, lifelong learning, new city design, permaculture and token economy.

To receive the grant, the first-time entrepreneur must adhere the following conditions:

  • The first-time entrepreneur must hold or propose to hold a minimum of 30% equity in the new company.
  • The first-time entrepreneur must dedicate a reasonable amount of time to the business, not be employed full-time by another employer and must be a key decision maker in the company.
  • The first-time entrepreneur cannot have already received funding for the proposed business from another government organisation.
  • Upon approval, the first-time entrepreneur must register a private limited company in Singapore.
  • If the first-time entrepreneur has already registered a company, it must not be more than 6 months old and must have at least 51% shareholding in Singapore.

Startup Incubators

The following are Singapore government accredited incubators:

Action Community For Entrepreneurship (ACE) works with startups working in all sectors

Advanced New Technology Incubator works with startups specializing in hardware, robotics, and automation.

FocusTech Ventures works with startups in IoT, advanced manufacturing, robotics, AI, and AR/VR.

JCS Venture Lab works with startups in advanced manufacturing and engineering.

Nanyang Technological University works with startups in advanced manufacturing, health and biomedical sciences, urban solutions and sustainability, services and digital economy.

NUS Ventures works with startups in IoT, AI, fintech, hardware, and software.

Singapore Management University works with startups in fintech, cybersecurity, data analytics and artificial intelligence, Smart City innovations, transportation, and logistics.

QuestVC works with startups in e-commerce.

Spaze Ventures works with startups financial services, fintech, healthcare, education, e-commerce, logistics, big data, enterprise solutions and IoT.

The Finlab works with startups in fintech.

TNB Ventures works with startups in IoT, AR/VR, robotics and AI.

Trendlines Medical works with startups creating medical devices and medical technology.

Tri5 Accelerator works with startups in fintech, energy tech, education tech, and marketplace platforms outside of Singapore.

August Global Asset Management works with startups in fintech, security, medical technology, education technology, agriculture technology, and big data.

Angel Investing Networks

Angel investors are high net worth individuals who invest in startups at their seed stage. These investors (known as “angels”) invest in companies despite no proven success of the company’s business model. The investors invest either individually or as a group. This funding source is advantageous to startups that do not have a final business model and require quick access to capital. In Singapore, the angel networks include the following:

Business Angel Network South East Asia (BANSEA)

BANSEA is an angel investment network that was established in 2001 in Singapore. It organises conferences, workshops, etc to promote the angel investing network in Asia. BANSEA’s mission is to facilitate investment opportunities for members in early stage startups. BANSEA is open to entrepreneurs who have a great idea and require funding to establish themselves.

Business Angel Scheme (BAS)

SPRING SEEDS supervises the Business Angel Scheme (BAS) which is an equity investment scheme for Singapore-based enterprises. SPRING SEEDS partners with angel groups to invest in innovative startups. SEEDS invests a dollar for a dollar up to a maximum amount of S$1.5 million. The business angel group and SEEDS will take an equity share in the startup in proportion to their investment.

Singapore Angel Network (SGAN)

Singapore Angel Network (SGAN) is the investment arm of Thakral Group of Companies in Singapore. SGAN invests in startups usually at the later stage of their finance requirements. This angel network does not target any specific industry and invests in various business sectors in Singapore and other countries as well.

Venture Capital Firms

Venture capital funding is often suitable for startups or late stage businesses that have a large capital requirement.

Following are the venture capital firms that invest in Singapore startups:

Singtel Innov8: This venture capital firm is a wholly owned subsidiary of Singapore’s largest telecom company, Singtel. The firm invests in early-stage startups in Asia-Pacific, US, and Europe. The firm invests in digital media, internet applications, technology sector etc.

KK Fund: Singapore-based KK Fund invests in seed stage startups specialising in internet and mobile companies in Southeast Asia, Hong Kong, and Taiwan.

East Ventures: A venture capital firm based in Tokyo, East Ventures invests in startups based in Southeast Asia that focus on consumer internet and mobile products.

Golden Gate Ventures: This global venture capital firm targets startups based in Southeast Asia that create internet products.

Fenox Venture Capital: Based in Silicon Valley, this firm actively invests in Singapore. It invests in emerging technology startups and also assists entrepreneurs in North America who wish to expand their business globally with a base in countries such as Singapore, Thailand, and Indonesia etc.

IMJ Investment Partners: The Singapore-based firm invests in startups in the country as well as other Southeast Asian countries. The firm invests in internet, mobile and software companies. Besides Southeast Asia, the firm invests in startups based in Japan and the United States.

Ardent Capital: A venture capital firm that invests in seed and early stage ventures. Ardent capital invests in technology companies in Southeast Asia. The firm focuses on specific regions such as Thailand, Singapore, Malaysia etc.

Jungle Ventures: Based in Singapore, this firm invests in the early stage of startups in Asia Pacific markets. The firm focuses on investments in technology, software, e-commerce etc and considers businesses that have the potential to grow in Asia. The firm also organises incubation programmes for Singapore startups.

Sequoia Capital: This venture capital and private equity firm focus on financial, healthcare, energy, mobile and internet startups. The firm invests in seed, early stage, and late stage startups. Besides investing in these startups, the firm specialises in incubation programmes that help in the growth of startups.

500 Startups: 500 Startups is a seed fund and startup accelerator based in Silicon Valley. The firm has funded over 500 startups and invests in Southeast Asia including Singapore.

Life.SREDA: This Singapore-based venture capital firm invests in growth stage fintech companies.

Singapore Venture Capital & Private Equity Association (SVCA): SVCA is a Singapore-based association established to “promote the development of the venture capital and private equity industry”. The association extends support to entrepreneurs by providing its members with the opportunity to connect with venture capitalists through events that they organize. This makes it easy for startups to connect with venture capitalists.

Private Equity Firms

Private equity investment refers to an investment made by a firm to acquire ownership of a non-public business. These firms usually invest in profitable companies which are in a high-growth stage. Private equity firms in Singapore include the following:

3V Source One Capital: 3V Source One Capital is a private equity firm that invests in sectors such as biotech, education, media, industrial, real estate, software etc. This firm caters to businesses in Singapore and specialises in investing in growth to late-stage companies. The firm also invests in companies in Greater China and the United States.

Venstar: Venstar, a private equity firm with its headquarters in Singapore invests in startups at their growth and expansion stage. The firm invests in startups in Singapore, Southeast Asia, and China. Few of the sectors that the firm invests in include petrochemical, pharmaceuticals, resources, and energy etc. Besides investing in startups, the firm is also involved in the management of the investee companies.

Navis Capital Partners: Founded in 1998, Navis Capital Partners invests in Asia, Australia, and Hong Kong. It has a strong presence in South and Southeast Asia which includes Singapore, Hong Kong, Malaysia, etc. Navis invests in industries such as fast moving consumer goods, food processing, industrial products, etc.

AIF Capital: The private equity firm having offices in Singapore, New Delhi, Hong Kong and Beijing focuses its investment in Asia, Southeast Asia, China, and India. The firm provides capital to growth companies in sectors such as healthcare and pharmaceuticals, media and advertising, power generation, financial services, etc.

Tael Partners: Singapore-based Tael Partners is a private equity firm that invests in sectors such as shipping and logistics, natural and mining resources, utilities and infrastructure, real estate development, etc. The firm founded in 2007 has offices in Malaysia, Indonesia, Vietnam, and Thailand and is one of the largest private equity firms in Singapore.

L Capital Asia: This private equity firm specialises in growth capital and invests mainly in consumer product brands, lifestyle retail, lifestyle food and beverages, beauty and wellness, boutique hospitality, etc. The firm, based in Singapore, invests mainly in Asia Pacific, Southeast Asia, India, Australia and New Zealand.

Conclusion

There are many venture capital firms, private equity firms and angel investing networks available to entrepreneurs in Singapore. In addition, the government of the country has launched many schemes and grants that facilitate the growth of startups in Singapore.

Singapore being one of the best places in the world to do business, has access to investors not only from Singapore but from other parts of the world. For instance, venture capital firms such as 500 Startups, Golden Gate Ventures, Sequoia, etc also invest in Singapore startups. Singapore has emerged as a key startup hub in Asia because of its pro-business environment, efficient legal system, and stable political system.

Malaysia Government Grants for SMEs & Startups

Malaysia Government Grants for SMEs & Startups

IPO Roadmap – Start with Government Funding

Government Schemes

Cradle Fund

Cradle Fund Sdn Bhd (Cradle) is Malaysia’s early stage start-up influencer, and has helped fund over 900 Malaysian tech start-ups and holds the highest commercialisation rate amongst government grants in the country.

Cradle Investment Programme 300 (CIP300) is a pre-commercialisation programme which provides financial and value added assistance up to RM300,000 for entrepreneurs to kick-start innovative technology based business ventures.

DEQ800 is a form of equity investment of up to RM800,000 for local tech start-ups. This programme aims to fund local early stage high potential technology start-ups.

Cradle Seed Ventures (CSV) is the venture capital arm of Cradle. CSV manages an early stage venture fund based out of Malaysia and is always on the lookout for start-ups with high growth potential, led by passionate founders with high levels of enthusiasm.

Coach and Grow Programme (CGP) is a market driven coaching programme intended to bring together key players in the entrepreneurial ecosystem to support and fortify technology entrepreneurs grow their businesses to greater heights.

Angel Tax Incentive. Cradle administers the Angel Tax Incentive, which was designed for Angel Investors to be accorded a tax deduction of up to RM 500,000 in the third year. Its objective is to stimulate and encourage angel investments form the private sector into technology based start-up companies in Malaysia

MDEC

Malaysia Digital Economy Corporation Sdn. Bhd. (MDEC) is the holistic, government-owned agency launched in 1996 to pioneer the transformation of Malaysia’s digital economy.

MDEC Digital Content Fund, also known as MAC3 Fund, is a government funding designed and created to support local creative content production companies in developing, producing, or co-producing digital content in animations and games.

There are three funds available for interested parties:

Development Fund focuses on the development stage of the Project, the stage where it involves idea generation, production design, market research and marketing analysis.

Production Fund focuses on the production stage of the project.

Co-Production Fund is designed to provide financial assistance to a project within the Eligible Project Categories to be co-produced by a Malaysian company and one or more foreign company(ies).

MTDC

For 25 years, Malaysian Technology Development Corporation (MTDC) has been the key player in technology commercialization in Malaysia and promoting the adoption of technologies by local companies.

Technology Acquisition Fund (TAF) is for the funding acquisition and commercialisation activities of foreign technologies undertaken by Malaysia-owned companies. The technology to be acquired has to have already been proven in the country of origin. Additionally, the technology can and will be immediately incorporated into the applicant’s production processes.

Commercialisation of Research and Development Fund (CRDF) is for the funding of commercialisation activities of locally developed technologies undertaken by Malaysian-owed companies. The technologies can be those developed by the public sector or an output of in-house research and development (R&D) activities by the companies.

Business Start-up Fund (BSF) is established to fund new start-up technology-based companies. The Fund incorporates elements of loan and equity, offering companies flexible funding via Convertible Promissory Notes and/or Preference Shares.

Business Growth Fund (BGF). A funding program that focuses on growing the company not only on its production output and reach, but also on internal preparedness towards professionalism, corporate governance, and all the necessary tools to escalagte the company to the next level.

Halal Technology Development Fund (HTDF) Specially designed to finance and nurture small and medium enterprises (SMEs) for long-term growth and export through halal compliant activities.

Business Expansion Fund (BEF) it to accelerate the expansion of Bumiputera technology-based companies, especially in developing international markets, by providing financial assistance to qualified companies. It aims to create a group of icons of internationally successful Bumiputera companies.

MAVCAP

Malaysia Venture Capital Management Berhad (MAVCAP) raison d’être is to support seed, start-up early stage to late stage companies in the ICT industry as well as other high-growth industries. (including but not limited to content and digital media, IOT, e-commerce, financial tech, etc)

STARTUP INCUBATORS

MaGIC

The Malaysian Global Innovation and Creativity Centre (MaGIC) has set its mission of building and growing the entrepreneurship ecosystem in Malaysia including support startups going regional and global.

MyCreative Ventures

MyCreative Ventures Sdn. Bhd. is a Government investment arm launched in September 2012 to spur Malaysia’s creative industry via strategic and innovative funding through debt or equity investments in Malaysian creative companies. RM200 million was allocated from the 2012 Malaysian Budget to help boost the creative industry’s significance to the Malaysian economy.

Cyberview Living Lab

The accelerator is another government initiative, with multiple partners running the program (used to be run by Watchtower, 1337, and so on). Thus, the mentorship is provided by different people each year or when the vendors change. The website states that they provide Value Added Services Up to RM50k.

1337 Ventures

1337 is a technology accelerator and early stage venture capital focused on pre-seed and seed stage investments in Malaysia as well as South East Asia. Our primary investments are technology solutions (social enterprises, commerce and other out-of-the-box solutions)

Alpha Startups is a pre-accelerator program for idea stage startups. The FREE 5-day intensive bootcamp is open for founders with business ideas, where participants will tackle practical idea validation, product development and go-to-market strategisation exercises.

The 1337 Accelerator (pronounced leet accelerator) was formed to fund aspiring new and existing startups in the app development space. If you think your ideas are breaking grounds, we want to hear them!

Tune Labs

Tune Labs is a venture capital business established to detect, finance and grow startup enterprises that focus on travel, finance and retail.

It is worth mentioning that Tan Sri Tony Fernandes is acting as Co-Founder and Chairman of Tune Labs.

The company aims to grow startups by taking them through all steps of their development, from idea validation to the final go-to-market stage.

To this end, Tune Labs runs an accelerator and an incubator program that are designed to boost the startup growth by offering mentorship and operations support. They look for entrepreneurs who already have a minimum viable product (MVP) focused on mobile, travel, e-commerce and fintech.

Digi Incub8

Digi Incub8 is a pre-accelerator program from Digi Telecommunications that addresses idea stage startups. It has been formed as a partnership with 1337 Ventures and Alpha Startups program.

This workshop is open to entrepreneurs that want to verify and validate their business ideas by undergoing through a process of idea validation, product development and marketing strategies. To reach this end, they have partnered with MaGIC and Uber.

Digi Incub8 provides startups from Malaysia access to mentorship options, networking possibilities and funding for tech startups.

Axiata Digital Innovation Fund

Axiata Digital Innovation Fund has been created by Axiata, MAVCAP and Johor Corporation.

The three public and private companies established and organized a venture capital fund that starts at RM80 million and offers investments of up to RM10 million per company.

The main purpose of the fund is to encourage and develop the digital ecosystem in Malaysia via greater connectivity, latest technologies and local talent.

This common enterprise is looking to find and support innovative high growth companies and target industries from e-commerce, big data, IoT, traditional to cloud services and fintech areas, to mention just a few.

They also offer great access to investment teams, networks of experienced entrepreneurs and telco businesses that sum up over 320 million mobile subscribers.

Sunway iLabs Accelerator

The Sunway iLabs from Sunway Group has been established according to a partnership between Sunway University, Sunway Group and its venture capital division, Sunway Ventures. Sunway runs this accelerator in collaboration with Nexea Angels.

Sunway iLabs Accelerator brings together 20 entrepreneur teams for a one-month sprint before selecting the 10 best teams at the end and offer RM50,000 to each of them for the remaining 5 months of the accelerator program in exchange for 8% in equity.

The startups that will enter the Sunway Group’s program will also have access to the business’ resources spreading across 12 business lines, Sunway University’s labs, researchers and interns. Founders have to attend workshops and mentoring session, while setting-up business KPIs.

At the same time, Sunway iLabs Accelerator recognizes the startups’ need for mentorship, markets and legal advice. As a big plus, their program is open to everybody, not only for individuals from Malaysia.

Conclusion

Accelerators and government funding are very important for Startups in their early phases. Typically, accelerators add value to the company via validation of ideas, validation or market, or validation of growth. Apart from that, some accelerators are also able to add value via networks, mentoring, funding, and also via shared services like Finance, SEO, Marketing, or HR.

Since different businesses come with different needs, there is no one size fits all solutions. Some may need financial support, others may need mentoring and the right connections and others simply lack the necessary technical and marketing resources that can help them grow. Hence, take your time and choose wisely 🙂

14 Key Fintech Investors in Malaysia You Should Know About

14 Key Fintech Investors in Malaysia You Should Know About

With a regulator that has been described as open to innovation and disruption, a maturing tech scene,  a mobile-friendly population, and a financial scene rife with incumbent and outdated technology, there is definitely a lot of potential in this region for fintech, if you’re hitting all the right notes.

These factors and more make Malaysia an appealing market for VC investments.

Despite dealing with finance though, it’s an open secret that fintech companies in Malaysia are ironically often strapped for cash. It’s not that there isn’t any money flowing into fintech companies, merely that they’re often focused on very specific places.

So based on publicly disclosed values, we’d like to shine a spotlight on some investors Malaysian fintech companies should know about, and some of the local companies in their portfolio.

[Seed Stage] Cradle

Cradle is one of the better-known investor companies in Malaysia, and has often been described as one of the builders and shapers of the Malaysian startup and tech field.

It is often known as the early investor into some of Malaysia’s tech giants today, like Grab and iMoney. Their investments are not limited to fintech, and covers a wide scope of startups

Malaysian fintech companies in their portfolio: MyCash Online, PolicyStreet, iMoney, Grab (prior to the GrabPay e-wallet push).

[Various Stages] Khazanah Nasional

Khazanah Nasional has been investing into companies locally and internationally since even the dotcom era. To this day, their biggest investment success is to inject money into pre-IPO Alibaba Group.

While Khazanah’s keen eye often looks out for larger corporations to pour their cash into, the sovereign fund has also launched Khazanah Nasional Entrepreneurship Outreach (KNEO), in collaboration with local accelerators 1337 Ventures, WatchTower & Friends, which has been known to nuture fintech startups through their programmes.

These efforts reflects Khazanah’s statement early this year: “This means that we could find clever smallish technology companies to invest in without having to pay lofty prices”

They are open to investing in local companies but did not provide any concrete assurances, perhaps holding out for a local company that they can truly believe in.

Khazanah has not disclosed any local fintech companies that they’ve invested in, but some notable local names include FashionValet.

[Seed Stage – Early Stage] KK Fund

KK Fund is a venture capital organisation that invests in seed stage internet and mobile startups across Southeast Asia, Hong Kong and Taiwan.

But as for KKFund itself, the Singapore-based company was founded by venture capitalists Koichi Saito and Kuan Hsu. The company seems to prefer Seed Round investments, and its portfolio has an extensive array of Malaysian companies of various backgrounds.

Malaysian fintech companies in their portfolio: PolicyStreet, CapitalBay.

[Seed Stage] MAVCAP

In 2001, the Malaysian government founded MAVCAP in the hopes of growing the burgeoning ICT industry in Malaysia. 17 years later, and they too have been caught in the startup fever that swept the nation.

The company’s goal is to help small or new companies to survive its difficult early years, because even innovative products could fail due to lack of resources. They have quite a variety of companies under their portfolio, and seem open to taking risks on rather unusual ideas or concepts.

Some of their previous investments include known names in the startup scene such as Grab, Fashion Valet, Hermo, The Lorry, Katsana, Easy Parcel, Aerodyne, and Carsome.

Malaysian fintech companies in their portfolio: Jirnexu, Billplz, Simply Given, Crowdo, Katsana, Grab (prior to their GrabPay push).

[Seed Stage] Captii Ventures

While it has not made any investments in the Malaysian fintech sphere of its publicly disclosed funds, Captii Ventures is based in Malaysia and have invested in quite a few fintech companies, like C88, UangTeman, Sepulsa, OnOnPay, and Pouchnation, many which are based in Indonesia.

Of its portfolio, the company has also invested in Malaysia-based Bfab, which again, implies that they would consider both a Malaysian and fintech company provided that it will add to their portfolio.

The company seems to prefer joining in a company’s seed round, but has shown precadent for Series B investments.

[Early Stage] Sumitomo Mitsui Card Co (SMCC)

So far, Sumimoto Mitsui has only invested into one Malaysian company, but their injection landed Soft Space into the list of one of the most well-funded fintech companies in Malaysia (of publicly disclosed values).

On a typical Monday, the Sumimoto Mitsui Card Company issues Visa credit cards to individuals in Japan, along with settlement services and credit finance loans to cardholders.

The company invested into Soft Space for both Series A ($5M) and Series B. Besides Soft Space, Sumimoto Mitsui has also invested in two other USA-based companies, Square Inc and Stripe Inc,

Sumimoto Mitsui has proven that they have a keen interest in funding fintech, and will continue to invest in the same company through further funding rounds as long as their investments prove themselves.

Malaysian fintech companies in their portfolio: Soft Space

[Seed Stage – Early Stage] OSK Ventures

While OSK Ventures does do Seed Round investments, its goal is to invest in established companies with a regional presence in their mid to late stages.

An affiliate of the OSK Holdings Berhad company, OSK Ventures has established itself as an investor in the region. On top of its usual operations, OSK Ventures has teamed up with Japan’s SBI Holdings Inc to form a joint venture fund to invest in promising prospects within the ASEAN region just in June.

The OSK-SBI Dynamic Growth Fund, as of July 2018 had $20 million to invest, including to promising Malaysian companies.

OSK Holdings, other than Jirnexu ($1.5M), has also invested in Singapore-based 4xLabs, which focuses on foreign exchanges, which showcases precadent for fintech in this region.

Malaysian fintech companies in their portfolio: Jirnexu

[Early Stage] Axiata Digital Innovation

Despite bearing the name of Axiata, Axiata is well-known as a Celcom affiliate, and the backers of one of the more prominent e-wallets, Boost, the fund is actually a collaboration between Axiata and MAVCAP.

The fund exists specifically to help cultivate the Malaysian ecosystem, with a particular focus on Bumiputera ventures, though it is not limited to it.

A cursory glance of their publicly disclosed funds reveals that the organisation is more interested in Early Stage companies that are slightly more mature, seemingly only joining the second or third round of investments.

They invest in companies from a variety of backgrounds, including fintech.

Malaysian fintech companies in their portfolio: Katsana

[Early Stage] SBI Group Japan

Image Credit: SBI Holdings

SBI Holdings has recently made the news cycles for launching Japan’s first bank-backed cryptocurrency exchange, but is otherwise known as a financial services group based in Tokyo.

As such, they have a keen interest in fintech investments from across the globe, with some of their more recent investments particularly focused on the USA region, though there have been sprinklings of investments throughout the globe.

The company has been seen joining a seed investment round in Japan, but as for their foreign investments, SBI Holdings seems more keen on early-stage funding, though there is one notable instance of a Series E funding into eToro.

Malaysian fintech companies in their portfolio: Jirnexu

[Early Stage] 500 Durians (extension of 500 Startups)

500 Startups has a strong presence throughout the globe, as is often seen as one of the movers and shakers of global tech and entrepreneurship trends–or at least an organisation that has a key eye on it.

The company’s Southeast Asian region is called 500 Durians, and is very prominently led by Khailee Ng of Says.com fame.

500 Durians will provide early-stage funding seemingly to startups from any background, as long as they have a solid idea. However, they have also shown notable interest in fintech-based companies and have backed organisations that have become prominent in the local fintech scene.

Malaysian fintech companies in their portfolio: billplz, Grab (prior to e-wallet push), HelloGold, iMoney.

[Early Stage] Gobi Partners

Gobi Partners is an early stage venture capital firm that focuses on IT and digital media investments in China. Since their launch more than a decade ago, they have since expanded to seven countries, with a base in Malaysia called Gobi Mavcap Management.

They are known as the backing entities behind companies that have a relatively prominent reputation among the Malaysian startup scene.

Even among Malaysian companies, Gobi Partners has shown precedence for investing in the same company as the investment rounds add up, if the company performs well enough under their first injection.

Malaysian fintech companies in their portfolio: Jirnexu

[Seed Stage – Early Stage] Monk Hill Ventures

Monk’s Hill Ventures is a VC firm started by a group of fellow entrepreneurs, based in both Indonesia and Singapore, and have backed tech companies in both Silicon Valley and Asia, with focus on Southeast Asian markets.

Earlier this year, it engaged Mohd Ridzwan Nordin, previously with Khazanah as a Malaysian venture partner, which seemingly indicates interest in Malaysian organisations moving forward.

According to e27, of particular interest to Ridzwan are fintech, enterprise software, edtech and B2C. This same focus on fintech is reflected in the company’s, other investments which includes Finaxar, Scalable.capital, C88, and Playlab, all coming from different nations and backgrounds.

The company seems to prefer earlier stage investments, up to Series C though that was a continuation of a previous Series B funding.

Of publicly disclosed funds, there doesn’t seem to be a notable instance of a Malaysian fintech investment at the time of writing, but the field has been described as one area of interest for Ridzwan.

[Various Rounds] Golden Gate Ventures

Image Credit: Golden Gate Ventures

Golden Gate Ventures is an early-stage VC firm based in Singapore, with an interest in Southeast Asian companies.

Most recently, Golden Gate Ventures has set up a $10 million fund named LuneX for investments in the realms of blockchain and cryptocurrency.

This fund seems more interested in Singaporean companies, but the company has previously invested in Malaysian companies before, like ServisHero, as well as fintech companies, like MoneySmart and CodaPayments. Therefore, it seems likely that the company will invest in a Malaysian fintech company as long as they come across one that they like.

Malaysian fintech companies in their portfolio: N/A

[Various Rounds] Sun Sea Capital

Besides just running their own investment firm,  KK Fund has partnered with Sunway to launch Sun SEA Capital, and while they won’t be exclusively investing in fintech, it is one of the key areas of focus for the company.

Due to its status as a more recently launched fund, Sun Sea Capital has yet to have to develop a robust investing portfolio, but considering the involvement of KK Fund though, it seems likely that its portfolio will reflect KK Fund’s investment philosophies.

The joint venture has also informed Fintech News Malaysia that fintech is one of the key areas of focus for the fund.

by Fintech News Malaysia

Financing for Small and Medium Enterprises (SMEs) in Malaysia

SMEs are a critical component of the Malaysian economy, contributing more than a third of gross domestic product (GDP) and providing job opportunities to more than four million workers in Malaysia. Banking institutions is the main source of financing for SMEs, providing more than 90% of total financing. Provision of SME financing is also complemented by the Development Financial Institutions, Bank Negara Malaysia’s Funds for SMEs and Government Funds

List of Financial Institutions Providing SME Financing in Malaysia

Development Financial Institutions

  1. Bank Perusahaan Kecil & Sederhana Malaysia Berhad (SME Bank) (www.smebank.com.my)
  2. Bank Pertanian Malaysia Berhad (Agrobank) (www.agrobank.com.my)
  3. Bank Pembangunan Malaysia Berhad (www.bpmb.com.my)
  4. Export-Import Bank of Malaysia Berhad (EXIM Bank) (www.exim.com.my)
  5. Bank Simpanan Nasional (www.mybsn.com.my)
  6. Bank Kerjasama Rakyat Malaysia Berhad (www.bankrakyat.com.my)

Commercial Banks

Islamic Banks

善用政府補助金, 小企業做成大企業

沒錢把生意做大,是許多中小企業的心聲。不少業者也在苦訴政府沒有好好援助推動經濟成長的中小企業領域。

現實的情況卻是,政府旗下援助基金多達40個,但國內很多企業家依舊對相關援助、優惠貸款便利及補助金或獎掖等毫無頭緒,以致錯失大好機會……

問題出在沒有找對管道!

Read More

MDEC (Multimedia Development Corporation)

The Multimedia Development Corporation (MDeC) was incorporated in 1996 to oversee the development of the MSC Malaysia and to advise the Malaysian Government on legislation and policies, as well as to set breakthrough standards for multimedia operations.

Established in the same year, MSC Malaysia’s primary focus was to create an ideal and conducive platform to nurture Malaysian Small and Medium Enterprises (SMEs) in the ICT sector, to become world-class businesses whilst attracting participation from global ICT companies to invest in and develop cutting edge digital and creative solutions in Malaysia. Seventeen years on, MSC Malaysia has driven the development of the Malaysian ICT industry, enhanced technology adoption, and has made significant strides in increasing the economic impact and footprint of ICT for the nation.

There are powerful economic and fiscal incentives for companies, both local and international, to apply for MSC status. Just as importantly, Malaysia has passed a number of effective new laws, which protect intellectual property and ensure freedom of thought and expression.

This remarkable initiative has positioned Malaysia as a preferred ICT investment hub. Today, there are over 3,600 MSC Malaysia Status companies, employing over 147,000 people, these include: 436 companies in the Creative Multimedia Cluster, more than 110 Institutions of Higher Learning and Incubators, 2,665 Information Technology companies and over 400 Shared Services & Outsourcing providers.

MSC Malaysia showed a solid performance and consistent growth in 2014, having generated RM38.52 billion in revenue, demonstrating a growth of 11% from 2013. Alongside strong revenue growth, MSC Malaysia saw RM20.09 billion in new investments, of which 55% came from direct domestic investments and 45% via foreign direct investments. Export sales accounted for a total of RM13.73 billion, representing an 11% increase from 2013 and a 7% rise in employment was also reported with 9,497 nett jobs created in 2014. Overall MSC Malaysia contribution to GDP reached RM13.77 billion, a 14% increase from 2013 and this means MSC Malaysia’s revenue now accounts for a substantial 1.3% of our GDP. Since its inception in 1996, MSC Malaysia has contributed over RM275.04 billion in revenue to the Malaysian economy, RM206.14 billion worth of investments.

In October 2010, MDeC was given an additional task by the government, which was to develop a blueprint for a Digital Economy that draws from the huge opportunities created by the Digital world.

This resulted in a programme called Digital Malaysia that was officially unveiled to the public in May 2012.

Digital Malaysia is a natural progression to harness the building blocks already laid by MSC Malaysia. Founded on three strategic thrusts, of moving Malaysia from supply to demand, consumption to production and low knowledge-add to high knowledge-add, it ultimately aims to create an ecosystem that promotes the pervasive use of ICT in all aspects of the economy. And the first eight projects are already under implementation.

This will in turn connect communities globally and enable them to interact in real time, increase the country’s Gross National Income, enhance business productivity and improve the standards of living.. Ultimately, Digital Malaysia aims to turn Malaysia into a developed digital economy by 2020, that connects and empowers the government, businesses and citizens. Today, both MSC Malaysia and Digital Malaysia run concurrently to spur Malaysia’s ICT industry development and digital economic growth, under the purview of MDeC.

http://www.mdec.com.my/

MOSTI (Ministry of Science, Technology and Innovation)

The Ministry was first established in 1973 as the Ministry of Technology, Research and Local Government. In 1976, in line with new functions and responsibilities pertaining to environmental matters, the Ministry then changed its name to Ministry of Science, Technology and Environment (MOSTE). On 27th March 2004, the Cabinet agreed to the restructuring of MOSTE and the name was changed to Ministry of Science, Technology and Innovation (MOSTI) in order to lead the National ICT Development function, Multimedia and Innovation. In 2007, the science and technology function was divided into Biotechnology, ICT, Industry, Sea to Space and S&T Services clusters.

Funds Available

ScienceFund
ScienceFund is a grant provided by Government to carry out R&D projects that can contribute to the discovery of new ideas and the advancement of knowledge in applied sciences, focusing on high impact and innovative research.

TechnoFund
TechnoFund is a grant scheme which aims to stimulate the growth and successful innovation of Malaysian enterprises by increasing the level of R&D and its commercialisation. The scheme provides funding for technology development, up to pre commercialisation stage, with the commercial potential to create new businesses and generate economic wealth for the nation.

InnoFund
InnoFund is a grant scheme which funds the development or improvement of new or existing products, processes or services with elements of innovation. The project must have economic value and improves the societal well-being of the community. InnoFund can be categorized into Enterprise InnoFund (EIF) and Community InnoFund (CIF).

Flagship Programmes
The Flagship Programme is a special grant scheme programme provided by MOSTI to fund research in areas identified to have an impact on the development of STI and aligned with the New Economic Model (NEM). The Flagship Programme is a top-down approach and the National Science and Research Council (NSRC) sets the research priority areas and particular niches that need to be implemented for the sustainability of current Government initiatives.

http://www.mosti.gov.my/

MTDC (Malaysian Technology Development Corporation)

Malaysian Technology Development Corporation (MTDC) was set up by government of Malaysia in 1992 to spearhead the development of technology businesses in Malaysia. Its initial role was to concentrate on the promotion and commercialisation of local research and invests in new ventures that can bring in new technologies from abroad.

Since the 7th Malaysia Plan, MTDC has been instrumental in the development of technology companies and commercialisation of new technologies.

MTDC has now evolved to become an Integrated Venture Capital Solutions Provider – successfully managing grants, venture capital funds, technology centres and nuturing technology companies.
Under the 10th Malaysia Plan, the role of MTDC had been expanded to create an effective ecosystem for commercialisation of homegrown technologies – to groom a new generation of Technopreneurs through comprehensive nurturing services that support them all the way from laboratory ideas to full commercialisation.

The right mix of dedication, knowledge, technology, innovation, conviction, support, investments and nurturing makes MTDC a Complete Equation… creating value and accelerating economic growth for the Nation.

Grants Available

Commercialisation of Research & Development Fund (CRDF)

Technology Acquisition Fund (TAF)

The Business Growth Fund (BGF) focuses specifically on supporting and providing follow-on funding to successful grant recipient companies. The fund provides hybrid grant-equity funding which acts as a transition and a bridge from grant to venture capital (VC) financing. The financial assistant is a mix of two components – a grant portion and an equity portion that is similarly structured but more flexible than a VC financing.

Business Start-up Fund (BSF) is established to fund new start-up technology-based companies. The Fund incorporates elements of loan and equity, offering companies flexible funding via Convertible Notes (CN) and/or Preference Shares. The objectives of BSF are to support and encourage entrepreneurship; creation of new strategic businesses that are important and potentially scalable; and funding of supporting companies within a technology eco-system.

The Business Expansion Fund (BEF) was introduced to assist Bumiputera technology based business entities to expand their operations locally and internationally. The fund offers a combination of equity and loan based financing. The equity portion will be offered through the subscription of RCPS (Redeemable Cumulative Preference Shares) without any collateral and coupon rate or interest for a period of 5 years. However, the applicant will be required to pay the full amount together with IRR of 10% at the fifth year or at a time the applicant decided to redeem the RCPS. The loan amount will be raised through participation from commercial banks with MTDC assistance or bank of your choice.

 

http://www.mtdc.com.my/

Cradle Fund

Our Mission
Cradle aims to help promising Malaysian technology entrepreneurs pave their way to success. Our services are specially designed to help technology start-ups at various stages. Click on the following links to learn more.

CIP Catalyst & U-CIP Catalyst
CIP Catalyst and U-CIP Catalyst are pre-seed conditional grants provides technology entrepreneurs with funds up to RM150,000 to turn their ideas into life-changing products.

CIP500
Malaysia’s first technology commercialisation fund that provides entrepreneurs with funds up to RM500,000 to bring their products into the marketplace.

Angel Tax Incentive
Angel investors can enjoy a tax deduction of up to RM500,000 off their personal income tax when they invest in Malaysian technology start-ups.

Coach & Grow Programme
A market driven programme intended to bring together key players in the entrepreneurial ecosystem to support and fortify technology entrepreneurs to bring their businesses to greater heights. Applications are now open.

http://www.cradle.com.my/

MALAYSIA DEBT VENTURES BHD (MDV)

MDV is a Venture Financing Organisation, providing contract/project financing facilities to early and growth stage companies within MDV’s ICT and Biotechnology Technology Focus Areas.

In essence, MDV or venture financiers are hybrid financing organisations. MDV’s products/services and customer development stage are similar to banks/financial institutions and venture capital respectively, but with key differences.

Compared to banks/financial institutions, MDV offers/provides the following: –

  • Assessment based on applicant’s management and technical capabilities, key assets for technology companies, via a Proprietary Due Diligence Methodology benchmarked with international best practices
  • Fixed Interest Rates (from 6.75% p.a.) on Daily Rest for our Conventional Loans. MDV’s Islamic
  • Financing similarly offers Competitive Profit Rates
  • Flexible repayment terms up to 5 years for ICT and 10 years for Biotechnology– Structured according to contract/project cashflow
  • Key collateral requirement is assignment of contract/project proceeds – Other collateral or credit enhancement subject overall risk assessment
  • Access to MDV value added services – Nurturing, Advisory, Networking, Business Development &
  • Support Services
  • Dedicated in-house technology team with comprehensive ICT and biotechnology background & knowledge
  • Similar to VCs, MDV provides financing to early or growth stage companies. However, MDV complements rather than compete with VCs and other equity investors
  • MDV offers financing or loan facilities; Does not invest in equity
  • Maintain shareholding composition – maximise shareholders’ control and value
  • Retain control over management
  • MDV financing independent of company valuation or stock market condition
  • Preserve full Intellectual Property ownership
  • Clear Exit : Loan Repayment or settlement of financing facilities

http://www.mdv.com.my/


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