'More needs to be done to establish MY as a startup hub,' says MY's Security Commission

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Malaysia’s Security Commission (SC) said that more needs to be done to establish Malaysia as a startup hub, even though the startup industry has seen positive developments in recent times, according to Bernama who was quoting SC’s chairman, Awang Adek Hussin at a Corporate Venture Capital launch event.

Hussin said that with the Malaysia’s investor community’s investment in the start-up ecosystem are two paramount areas that need more focus in order to establish Malaysia as a start-up hub.

Hussin went on to add that small and medium enterprises (SMEs), along with start-ups, are now playing a bigger role in driving activities which help boost the country’s GDP levels. One viable solution to finance these start-ups, according to him, is capital market financing, which allows SMEs to raise funds and eventually grow and contribute to the economy. He believes that the capital market could boost investor morale and attract more capital to push the growth of SMEs.

Don't miss: Former Fave leaders Joel Neoh and Audra Pakalnyte launch fund to support startups in SEA

The financing challenges faced by SMEs is also largely due to the difficulties in accessing sustainable funding for their business whereby traditional bank loans might have limitations in their financing needs, which is often why larger firms have a greater survival rate compared to start-ups.

In better news, Hussin said that there is growing interest from various Malaysian states to help start-ups, which allows them to become centres of innovation.

As Malaysia looks to grow its start-up business, the influx of tech giants to Malaysia’s shores is also bound to act as a springboard for greater investments in start-ups. With the likes of Tesla and Amazon Web Services finding a home in Malaysia, local firms are bound to receive the collateral benefits of the influx.

The launch of Tesla in Malaysia has the potential to create skilled and better paying job opportunities for workers in the BEV segment and increase the participation of local companies in the Tesla ecosystem both domestically and globally. Tengku Zafrul Aziz, MITI Minister said at that point that the move demonstrates Tesla’s confidence in Malaysia’s economic fundamentals and conducive business environment, which is a reaffirmation of Malaysia's hospitable environment for business.

On the startup front, former Fave executives Joel Neoh and Audra Pakalnyte recently established First Move, a founder-led early-stage fund launched to empower consumer-focused start-ups across Southeast Asia. The fund, which aims at making significant steps towards fuelling innovation and reshaping the consumer technology landscape in the region, aims to provide pre-seed funding of up to US$100,000 to companies. It also has a current portfolio of seven companies spanning Singapore, Malaysia, and Indonesia.