Malaysia does not have a developed venture capital industry and there are only a handful of local funds that are mostly backed by the government.
Mavcap is the major and most developed venture capital fund in the country.
As the government funds given to the venture capitals are structured as loans instead of investments, fund managers are highly risk-averse. They mostly invest in seed and early rounds hence there still is a need for growth capital. Generally, Singapore-based funds close this gap.
On the entrepreneur side, Malaysia’s business environment improved significantly in recent years. Government-backed institutions and programs such as Malaysia Digital Economic Corporation (MDEC) and Malaysia Tech Entrepreneur Program (MTEP) are driving engines of the startup ecosystem. Penang and Johor Bahru are the major startup hubs along with the capital Kuala Lumpur.
iFlix, Carsome, and Jirnexu are the best-funded startups in 2018. The region’s first decacorn startup Grab was first established in Malaysia and then moved to Singapore.