KUALA LUMPUR: The Malaysian Global Innovation & Creativity Centre (MaGIC) and Penjana Kapital Sdn Bhd (PKSB) are collaborating to unlock potential investment opportunities for innovative start-ups to position them to scale and grow regionally and beyond.
In bridging the funding gap faced by start-ups, MaGIC will funnel its alumni, particularly the seed stage start-ups, to venture capitals (VC) under the Dana Penjana Nasional (DPN) programme.
The VCs include Tenggara Capital Partners, IMO Ventures, and The Hive SouthEast Asia, Tuas Capital Partners for the seed stage.
The DPN, which is a matching fund-of-funds programme, is administered by PKSB.
This programme, which is part of the Short-Term Economic Recovery Plan (PENJANA), is aimed at bridging the funding gap in the country by incentivising private capital to facilitate the growth of start-ups and create an enabling environment for these start-ups to scale and expand their reach internationally.
The government will match RM600 million, on a 1:1 basis, of the funds raised by the VC fund managers from foreign and private domestic investors, with a target allocation of RM1.2 billion.
At its first close at the end-May 2021, PKSB raised RM850 million, with more than half from foreign investors in Hong Kong, South Korea and Singapore.
The successful first close means that the programme is on track to meet the target of RM1.2 billion.
MaGIC is one of the key ecosystem enablers in nurturing the growth of start-ups in Malaysia.
The interventions that MaGIC offers revolve around capacity development, collaborative entrepreneurship, facilitating market and capital access to the start-ups.
Since its operation in 2014, MaGIC's programmes have impacted over 100,000 aspiring and seasoned entrepreneurs, 2,800 start-ups and created an economic value of RM2.1 billion.
By bridging the funding gap, MaGIC and PKSB aspire to reorient private capital for innovative start-ups, attract global and regional VCs into Malaysia and elevate knowledge transfer, talent development and creation in the Malaysia ecosystem.
MaGIC has kicked off two key programmes to meet these objectives – Ace Your Pitch and Strike a Pitch.
70 start-ups participated in Ace Your Pitch, which comprises a clinic session to support start-ups in enhancing their pitch presentation, including improving understanding of funding fundamentals, elevating their pitch deck and polishing their presentation skills.
In Strike a Pitch, 19 start-ups were shortlisted from 84 applicants to pitch to VCs Immersion Ventures Tenggara Capital, The Hive Southeast Asia-Tuas Capital and PKSB.
Eight successful start-ups will proceed to the next stage of VC assessment for further deliberation.
"Being a key enabler to the ecosystem, we are aware of the challenges faced by start-ups as we regularly engage with them. We have always stressed the importance of capacity building, and we are happy to identify start-ups with potential and funnel them to Penjana Kapital and its partner VCs.
"Funding has always been a key challenge for start-ups to scale up, and we seek to bridge this gap via the DPN," MaGIC acting chief executive officer Amiruddin Abdul Shukor said in a statement today.
PKSB chief investment officer Taufiq Iskandar said the collaboration with MaGIC would boost DPN's objectives to overcome the innovation funding gap and accelerate Malaysia's economic recovery whose momentum has been derailed by a more persistent Covid-19 pandemic.
"MaGIC's experience in the start-up ecosystem, in particular tech start-ups, will help us in our quest to streamline the digitalisation and automation of Malaysian businesses through innovation.
"We are aware that seed-stage start-ups face some funding challenges, and in collaboration with MaGIC, we believe we can help them overcome these," he said.