Happy Merdeka Fellow Entrepreneurs.
So the budget was revealed by our dear PM on Friday. Malaysia Entrepreneurs was invited to a special edition of Perspektif Kita and we have a few comments on how is it going to effect entrepreneurship, investing and business in general in Malaysia.
To be honest, there was not anything new to shout about.
What was interesting was the allocation in Promoting Venture Capital Companies.
It states that Venture capital companies that invest at least 30% of their funds in start-up, early stage financing or seed capital be eligible for a 5-year tax exemption.
Sure thing, there is a lack of early stage venture investment in Malaysia and I would say in this region. As we know there are 2 main grants who look in pre seed ideas and a bunch of Mavcap linked VC that are investing in early stage startup. Would this encourage the other VC to come in to this market?
We believe No. For one, is it not clear what do they mean by start up. With the Mesdaq not performing as well it should be, there is generally no proper way for them to exit. Even for being a tax heaven, 30% investment is rather huge compare to a much lower risk pumping money into Pre-IPO companies.
I believe this is a commendable effort from the government to get more investment in the seed stage. I believe they should find ways to get more foreign investment in this area.
So what were the other complains?
The participant at the talked show complained there were nothing specific for the ICT industry and for those in Biotech.
Also there were not much in this budget, there are general consensus that the government need to upgrade the human capital of Malaysia as some local MSC companies cannot attract enough talents.
We believe, of course it is good that the government take the initiative to promote local business and create a more vibrant start-up eco system.
The fact is, entrepreneurs must learn to not rely solely on the government initiatives for their businesses. As Dato Rajan puts it, we need to learn to be Merdeka in our minds if we want to succeed.
- The Malaysia Budget
- Parents Should Invest in Young Entrepreneur’s Startup Dreams: An Africa’s Entrepreneur Example
- Venture Capital Funds for Entrepreneurs and Start-Ups in Asia
- What is it like to be a Venture Capitalist
- Get to know your MSC Pre Seed Fund
- 2 Vital Factors that Entrepreneurs Must Know When Registering their Companies