In SEA, we have witnessed a considerable leap in startup funding. In 2016, the total funding in SEA was US$1.61 billion, which was a 43% increase from the previous year and the estimate for 2017 is US$ 2.6 billions. While the capital available for startups is looking very positive, how much of it will actually come to fuel Malaysian startups?
At the same time, as rapidly as the Malaysian startup ecosystem is growing, have we hit the level of maturity where we are able to nurture startups who will be able to raise more than $100M this year? Since Grab moved to Singapore and raised its first US$100 million over 2 years ago, only a handful of startups were able to raise a fraction of that amount. It would certainly be an interesting discussion that if, or most importantly– how, the ecosystem is growing fast enough to be able to move companies to the next level and provide good entrepreneurs and talent the resources they need to reach their full potential.
From the predictions made by the groups of people we asked, the entrepreneurs were the most optimistic of the lot, with slightly more than half saying yes to a Malaysian-based startup raising more than $100M this year; while the investors and corporates remained mostly sceptical. Some of the potential investments include startups like iFlix, Fave (ex-Kfit), 123rf, Fusionex, NIDA Rooms and GreenDataCenter.
Some highlights from the discussion of this question:
Co-founder/CEO at Catcha Group
“The ASEAN region will register over 300m smartphone users in 2017, and Malaysia is strategically positioned to capitalise on this opportunity. 2017 will be the year of big funding rounds for a select few companies that are creating MASSIVE disruption. Smart entrepreneurs will scale quickly requiring that next funding boost to wipe out the competition. The region is creating great massive companies like Gojek, Grab and Garena and it’s time for a Malaysian based startup to join that list!”
Managing Partner at TinkBig Venture
“The main reason which i don’t think Malaysia company will be able to raised this amount is mainly due to the market opportunity and size. Any company that is raising this amount will be look at Series B and above, yet we are lack of late stage VC firm who will be backing them up. The company that is looking to raise this amount of funding who need to demonstrate the exception execution ability in scaling and expansion, defensible intellectual property, clear market leader in the space they are competing and most importantly there need to be in a situation where GMV and EBITDA rhythm to the investors”
Aziz Kevin Lee
Assistant Vice President at Khazanah Nasional
“In spite of the current economic situation and the state of political uncertainty globally, I do believe that at least a few of the better known, not necessarily better performing, Malaysian-based companies will be surpassing that 100m mark, though a company raising more than USD100m isn’t exactly a startup anymore, no?”