Startups are the backbone of modern economic growth prospects. Silicon Valley is the most well-known startup hub in the world, primarily known for promoting tech and innovation newcomers from across the globe. From Sundar Pichai to Mark Zuckerberg; the tech world is awash with experienced industry specialists who decided to start their ventures.
But the South San Francisco region is not the only tech development nerve centre in the world. Many other countries are stepping up their innovation quotas with Southeast Asian countries, including Malaysia, emerging as hotbeds of development. Currently ranked as the 11th best startup destination in the world, the Malaysia tech startup scene is aiming to move up the ranks. But what unique amenities does this rapidly developing country have to offer startups? We took a look at a few of the reasons investors and entrepreneurs should consider Malaysia as a tech hub.
Government funding relief
The Ministry of Science Technology & Innovation and Ministry of Finance of Malaysia have come together to launch the Technology Start-ups Funding Relief Facility (TSFRF). TSFRF has a budget of RM100 million ($24.5 million USD) to provide funding and aid to the startups that crashed due to COVID disruptions.
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Managed by the government-supported Malaysia Debt Ventures funding organisation, TSFRF offers targeted cash flow support to tech startups and other eligible entrepreneurship ventures to help them sustain their operations. TSFRF received 49 applications in its first round of applications and has continued to work with local startups.
National PENJANA fund
The solution to the current economic crisis caused by COVID-19 has always lain in digitalisation. Many struggling businesses could survive if they were operating online. As such, Malaysia implemented a solution to the problem with the PENJANA Fund in June of 2020 to assist the country in its move to operating digitally.
The project has invested RM750 million ($183 million USD) in the ePanjana Programme where every eligible local person gets RM50 ($12 USD) worth of online credit per person and RM50 worth of vouchers and discounts through eWallet service providers.
Rather than sitting in a corner and watching their economy fall apart, Malaysia has gone out of its way to give revenue to customers and a platform for companies to present their products. The simple plan is to push as many businesses online as possible so that companies still have the potential to grow amidst the crisis.
National Technology & Innovation Sandbox
The country’s National Technology & Innovation Sandbox (NTIS) is another decisive step that strives to solve the financial crisis in the tech world. The NTIS helps researchers, high-tech entrepreneurs, innovators, and new ventures to try their business in a live environment, whether it is a business model, product, or service. It helps backed programs skip regulatory and selection processes to expedite the research and development of ideas and aims to ensure that innovative venture options with limited funding do not flounder due to tough competition. NTIS helps startup ventures to become commercially ready for launch.
The benefits of NTIS includes multi-industry adoption so that the venture can spread across various industry niches. For example, a blockchain venture can go beyond cryptocurrency, opening it up for blockchain-based data retention projects.
This platform also helps in managing regulations and laws to ensure that companies pass the litmus test for launch. This essentially allows for funding aid and market and procurement access. The capacity-building programs aid brand growth for startups too.
Malaysia Tech Month 2020
Despite COVID-19 restrictions, Malaysia Tech Month (MTM) 2020 commenced on 10th November, highlighting the startup scene in the country and promoting how it is perfect for SaaS product developments and launches.
MTM 2020 was free for all participants hosting unique technology panels and platforms from tech giants across the globe. The satellite events in MTM 2020 aimed to ensure that Malaysia is at the “Heart of Digital ASEAN” and will be a tech and digital hub highly appraised globally.
Though it may be a developing country, Malaysia as a tech hub startup is a fantastic prospect. It has a great mix consisting of the strong buyer’s market of Asia and phenomenally conducive and lax regulations from the government. It has long been coveted because of having the Southeast Asian, Chinese, and Asia Pacific markets, or in other words the strongest buying power in the world, at its doorstep. Adding on, Malaysia also pays considerable attention to the growth prospects of its startups. Ranked 4th globally for manufacturing competitiveness and 12th for ease of doing business, Malaysia’s tech startup scene has a lot to offer those willing to set up business there.