Malaysia is well known for its soaring landmarks, world heritage sites and pristine coastal lines, but it may also soon be known for its top-tier startup ecosystem. According to innovation policy adviser, Startup Genome, the Malaysian capital, Kuala Lumpur ranked as the 11th emerging startup ecosystem in the Global Startup Ecosystem Report 2020.
Southeast Asia’s demand for digital products and services is growing at an incredible rate, and Malaysia’s startup ecosystem is reaping the benefits thanks to innovative startups in Malaysia.
Malaysia Tech Month: A celebration of tech talent
With 33 million people, Malaysia has a well-educated, diverse workforce who speak multiple languages. The Malaysia Tech Month, which despite COVID-19 still went ahead in November 2020, is a month-long exhibit of all the talented people improving their industry 4.0 knowledge, businesses on the road to their global success, and Malaysia showcasing their strength in the tech ecosystem and epitome for a digital home.
The Alibaba Cloud innovation centre and what it means for the Malaysian startup ecosystem
With over 70 speakers and multiple satellite events, the Malaysia Tech Month 2021 will “drive MDEC’s aspiration to firmly establish Malaysia as the Heart of Digital ASEAN” as well as secure investments. Malaysia may still be a developing country, but its future in tech certainly looks like a bright one.
The motherland of many startups
Malaysia is the place of origin for many startups. The ride-hailing giant Grab started as MyTeski in Malaysia before moving its headquarters to Singapore in 2014. Although Malaysia is still a crucial market for Grab, it needs more funding and support from its government to ensure it doesn’t lose any more of its domestic talent pool to neighbouring countries.
It has also been home to BigPay, a Malaysian Fintech startup set up in 2017, which has also moved its headquarters to Singapore. However, some startups have remained in Malaysia. Carsome, an automotive e-commerce startup providing an easy online car purchasing platform, and BookDoc, a healthcare startup founded in 2015, are headquartered in the country where they began.
Although some companies have moved away, it is not surprising that many startups that originated in Malaysia raise millions of US dollars in funding. Startup Genome also named Kuala Lumpur a great area to invest in and for startups to move to if they want to flourish. This is mainly due to its high-quality talent but low employee and living costs, startups’ government funding schemes, and fast track visas.
Cradle investment programme
Cradle investment is an agency under the Ministry of Science, Technology and Innovation. Individual or locally incorporated companies operating for less than three years and fulfilling the following criteria can apply for the grant:
- A team comprises of two members only
- The primary applicant is a Malaysian aged 18 years & above;
- The primary applicant is a permanent resident in Malaysia;
- In the case of a company, it must be incorporated less than three years with 51% of the company’s equity held by Malaysians and accumulated revenue is NOT more than 3 million MYR
Since 2003 Cradle’s objective has been to fund high-calibre technology projects. It has already supported over 1,000 Malaysian technology-based companies, including the aforementioned tech giant Grab. Cradle is also looking to invest more than monetary value into startups in Malaysia; they want to provide commercialisation support and other services to accelerate growth.
ServisHero is a technology-enabled marketplace for blue-collar workers. Headquartered in Malaysia, it has operations in multiple neighbouring countries such as Singapore and Thailand. It was launched in 2015 as one of the country’s first regional mobile apps to hire home service providers. The app connects people with plumbers, cleaners, handymen and more. It is becoming increasingly popular with Malaysians.
ServisHero Group (SHG) also operates small business productivity SaaS under the WorkMagic brand allowing enterprises to be more flexible with their workforce. The multi-platform app creates an opportunity for companies to avoid the complexity of managing their teams and lets clients track work with real-time updates.
Malaysia is fast becoming an ideal hub for startups. It has experienced steady growth in its tech market and has seen significant improvement in its business climate. With Malaysia’s consistent push for technology, government grants for startups and pool of talented people in the area, Malaysia is a brilliant entry point for tech companies.
The geographical location also means that startups in Malaysia are in a prime spot for cross-country operations, situated between three already growing markets in Singapore, Indonesia and Thailand. Malaysia has ranked 4th globally for manufacturing competitiveness, putting it ahead of China, Japan and Vietnam, and 12th for ease of doing business, with its highest score being for business startups. The Malaysia startup ecosystem certainly has a lot to offer to those willing to set up a business in the region.