Malaysia Advice

Advice for Local Entrepreneurs

Prominent Local Investor, Jonathan Lee from Cradle gives advice to local Entrepreneurs:

  1. Know your business – product, market, customers, financials.
  2. Know your potential investor – who they are, how much they fund, what is their portfolio type, risk appetite. Then target them accordingly. A tech VC won't fund traditional retail businesses, so don't waste your time and their time.
  3. Have a strong well rounded team – if not, make plans to attract talent into your team.
  4. Never underestimate business development. It should be as important if not more important than technology development. A great product doesn't sells itself but is always marketed by someone.
  5. Track record counts – whether it is the team, contracts secured, strategic partnerships, previous funding from angels, etc.
  6. Know how to do an elevated pitch and a presentation deck. If you cannot convince someone of your capabilities and your business in 5 minutes, the attention is gone.
  7. Understand that investors are out to make money, that’s why they are called investors. If they are not convinced you can make them money then they will not invest. Plain, simple and NOT personal.8. Be prepared to negotiate where valuation is concerned. Sometimes, value added services from the VCs are more important than the amount of investment put in.
  8. Be prepared to take criticism and more importantly, learn from the feedback given.
  9. Rejection doesn't mean failure. Get up, improve yourself and try again. Nobody expects to ink a deal overnight. Investment takes time.

Think Regional and Global

It is important for local entrepreneurs to understand the market size limitation of Malaysia (due to population size) and also understand Malaysia’s massive potential as a regional hub (great geographic location, logistics, infrastructure, and cost of business). However, becoming #1 in Malaysia and selling to regional / global players is a good deal for first time founders as well.

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Advice for Foreign Entrepreneurs

Get out of the Bangsar Bubble

It is very common for foreign entrepreneurs to limit their understanding of Malaysia to its most posh areas in Kuala Lumpur: Golden Triangle (KLCC), Mont Kiara, Bangsar and TTDI. This is only a very narrow, elite and liberal segment of Malaysia. To further understand the culture and market opportunities of Malaysia as a whole, it is important to get outside this area and Kuala Lumpur in general, especially areas that are more Malay-majority (Kota Bharu city up far north near Thailand to Kampung Baru in Kuala Lumpur).

White Face

Being a Western (especially a Caucasian-looking one) foreigner, can open more doors in terms of business contacts and networking. In the business circle there is such a thing called “white face” where Westerners are given more consideration in terms of approving projects and recommendations. However, be careful not to abuse this, as the “white face” stereotype works both ways, and one can find themselves quickly labeled as a fly-by-night confidence man hiding behind a “white face.”

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Advice for Foreign Investors

There are a lot of SME (tech companies who have been around for a long time) that are profitable, but slowly growing. Given the right ideas and capital, they can execute on proven models very well. This is something foreign VCs are starting to notice. Moreover, Malaysians are generally good bootstrappers and its not unusual to meet self-funded founders with a proven product and early traction at local meetups.

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Advice for Foreign Companies

Government IncentivesThere is a wide array of Malaysian government incentives run by various government organizations (see Khazanah, MDeC, and MIDA just to start). Most of them include tax breaks (and other types of credit) and different types of visas. It is important to study them carefully to understand which benefits your startup most and which incentive program allows you to give the most back to Malaysia.

SOURCES

http://www.ssm.com.my/

https://www.malaysia.gov.my/en/business

http://www.mida.gov.my/env3/

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Need More Help?

Do you have a specific question that you really need help on? Take a look below to see who might be able to help. All of them are committed to help make Malaysia a better place for startups. If they can't help you, they will be able to direct you to someone who will be able to help. Goo luck!