List of Venture Capital Funds in Malaysia For Startups

UPDATED 3 FEBRUARY 2021: More information & VCs added to the list

This article about VCs in Malaysia includes the definition of VCs, why companies need VCs, the VC environment, and of course, the list of Venture Capital funds in Malaysia and the rest of Southeast Asia. We have also included how you can find the right VC for your company as well!

How is Venture Capital defined?

A venture capitalist or VC is an investor who either provides capital to startup ventures or supports small companies that wish to expand but do not have access to equities markets. Venture capitalists are willing to invest in such companies because they can earn an impressive return on their investments if these companies turn out to be successful.Venture capitalists look for a strong management team, a large potential market and a unique product or service with a strong competitive advantage. They also look for opportunities in industries that they are familiar with, and the chance to own a large stake of the company so that they can influence its direction. At NEXEA we are interested in tech start-ups as this is our expertise.  

Why do companies require Venture Capital Firms?

Is it true that Venture Capital fund managers always bring in value on the strategy and execution of the business? That is far from the truth – from my experience, not many Venture Capitalists are able to bring in much value. Not only are they too busy managing 10-20 companies per partner, but they also have to manage many of their Limited Partners (investors) too!

However, any VC in this list of venture capital firms in Malaysia are more than just a fund. They will be part owner of a company and want to see this company grow so they will do anything to help a start-up succeed. At NEXEA we have ex-entrepreneurs who can guide start-ups and help them avoid mistakes they have made before when setting up their business.

The start-ups need venture capitalist as they are mostly rapid growing companies with inexperienced owners who do not always know what to look out for. To reduce the risk for the venture capitalist as well as for the start-up it is important that there is a great connection between the two parties.

"You will need to do the due diligence in order to really understand if a VC is going to add value in addition to capital. This value can be introductions for potential partnerships, their network of other successful founders, or the infrastructure the firm brings."

Venture Capital in Malaysia - The Environment / Ecosystem

VC in Malaysia has been booming lately. There has been an increase in venture capital firms over the last couple of years. This increase has been very positive for the start-up environment in Malaysia. Venture capital has a great influence on a growing economy as well as job creation and transitioning into a knowledge-based economy. This is extremely important for Malaysia and this great environment has and will on having a great influence on the country.

Furthermore, the success rate of start-ups is significantly improved by venture capital in Malaysia. They bring in not just money, but also value like connections to corporates, and follow in investments from venture capitalists that do larger deals than they do. Eventually, the private venture capital market leads to the private equity, mezzanine investors, or even public markets where Startups can eventually exit.

venture capital funds in malaysia / venture capital in malaysia

Very Early Stage Investment Venture Capital List Malaysia investing under US$1m

Venture Capital funds in Malaysia for early stage startup companies are listed below:

Later Stage Investment VC Funds in Malaysia investing above US$1m

List of Accelerators in Malaysia (Idea Stage Startups)

We added this to our venture capital list because venture capitalists dont typically cover idea stage companies.

An accelerator is a 3-4 month program that helps Startups jump-start their business with about RM50k for about 8%. Startups that graduate should be able to raise funds. Accelerators usually offer mentoring and coaching, as well as networking opportunities.

Government start-up accelerators

Private start-up accelerators

Corporate start-up accelerators

List of Government Grants in Malaysia (Early Stage Startups)

A government grant is a financial award given by the federal government to an eligible startup. In Malaysia, this usually originates from the Ministry of Finance. 

List of Venture Capital in Southeast Asia

The Venture Capital Southeast Asia ecosystem has been growing significantly from previous years as the internet economy rapidly expanding. According to Pitchbook, the venture capital dry power has increased up to eleven-fold in the past 6 years. This shows how competitive the VC landscape is in Southeast Asia as large international investors (Y Combinator, 500 Startups, GGV Capital, etc) start to focus on SEA, while regional VC investors (NEXEA, Asia Partners, Strive, etc) are doubling down.

View the full list of venture capital in SEA here.

Finding the top Venture Capital firms in Malaysia for your company

First of all, you have to know what stage your company is currently. When you know what stage your company is in you can start applying to venture capital. To ensure you have the opportunity to pitch your company you have to prepare an informing pitch deck.

The infrastructure and “speciality” of the VC is the most interesting part to look out for, this is what separates the best from the rest. Venture Capitalists like Andreessen Horowitz or First Round Capital have a dedicated team of marketers, recruiters and other resources to bring into a company they invest in. At NEXEA, we have dedicated lawyers, regional level CFOs, many world-class CEOs that mentor and invest in Startups and other support infrastructure in place.

Lastly, set boundaries for yourself. Especially companies which are founded by multiple people it is very important that you know from each other what you are willing to give away. Giving away is not only in terms of equity but as well in time. When a venture capitalist invests in your firm the whole working dynamic can change as you hopefully transition in a fast-growing firm.

Steps to finding the right Venture Capital funds in Malaysia

In addition to some tips to find the correct venture capital firm for your company, we would like to supply you with some easy steps which you could implement to find via this venture capital list that fits your firm.

  1. Geography: The location of your startup should be in the region which the VC is operating in. At NEXEA we invest in tech start-ups in the SEA region. However, for some programs, we prefer companies that are based in Malaysia as we are located in Kuala Lumpur. So do some research on the VC to know if your location is applicable to them.
  2. Sector: Usually VC's only invest in companies that operate in fields of business where they have a lot of experience in. As discussed before at NEXEA we have a lot of expertise in tech-related companies. For us, a company which has a traditional business model would not be applicable.
  3. Portfolio conflict: A VC will typically not invest in a company which is a direct competitor of a company in their portfolio. So before applying to a VC find out about there portfolio and see if you can identify any direct competitors.
  4. Involvement: There are two types of VC firms, the first group are the VC's that are very involved. These VC's typically do not invest in a lot of companies as they do not have the time to be highly involved in a lot of companies. The second group of VC's are the opposite, these firms are not very involved in the companies they invest in. This is usually due to the number of start-ups they invest in. They simply do not have the time to have a meeting with each startup every week. At NEXEA we are highly involved with each start-up due to our start-up mentor network. For a start-up, it is essential to know from each founder whether they prefer a highly involved VC or less involved VC.
  5. Fund size: A start-up has to know beforehand what series a VC invest in. It does not make sense to apply for a pre-seed start-up while you are doing your A-series. Furthermore, if you plan beforehand that you want to do you B-series and A-series with the same VC to ensure good collaboration, you should check whether or not they invest in both series.

List of Venture Capital Funds in Malaysia - Summary

There has been and a growing number of venture capital firms in Malaysia which has a very positive effect on the economy of the country. For startups wanting a venture capital, it is important to identify in what stage they are as well as finding the right expertise and setting boundaries for the company.

We hope this venture capital list has provided you with enough knowledge. Let us know in the comments if there is anything we should add?

Learn More About NEXEA Venture Capital & How We Provide More Than Just Money

References:

https://www.inc.com/bubba-page/5-steps-to-finding-the-right-venture-capital-investor.html https://www.forbes.com/sites/alejandrocremades/2018/08/02/how-venture-capital-works/

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Written by Ben Lim

I am the Founder & Managing Partner at NEXEA, a startup investment group in Southeast Asia. We have invested in the idea stage to pre-A Startup investments around the region.

We fund the best Founders and provide them with an edge via mentoring & networks by the best investors.

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5 comments on “List of Venture Capital Funds in Malaysia For Startups”

    1. Ben thanks for your insights. Would you be able to guide me to a venture capital opportunities with ESG initiatives.

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