By Chan Quan Min
The federal government’s RM70 million bid to attract tech entrepreneurs to Cyberjaya is the Malaysian Global Innovation and Creativity Centre (MaGIC), housed in an impressive 115,000 square feet building.
Despite it being too early to tell (MaGic is not yet a year old) if throwing money at budding tech entrepreneurs will turn Cyberjaya into the next Silicon Valley, MaGIC already has its fair share of critics.
They contend that the government has agencies with overlapping mandates to promote entrepreneurship and innovation. This is true; there is Agensi Inovasi Malaysia, Cradle Fund, and the Science, Technology and Innovation Ministry, just to name three of several that give out seed funding to tech startups.
“As usual, and we can see that from what happened with the Multimedia Super Corridor project, we seem to think that bold new ventures require the construction of big, bright new buildings…or massive renovations, at the least.
“I’d rather more money and effort were spent on getting the right people and getting the processes right,” said A Asohan, a Digital News Asia journalist, in his column last year.
Cheryl Yeoh
More recently, a keen follower of the tech startup scene told KiniBiz that her beef with MaGIC was that it is was not coming up with new ideas, merely replicating successful models both local and overseas.
This comment came a week before MaGIC CEO Cheryl Yeoh told reporters she was looking to offer in Malaysia a similar programme as Startup Chile.
Startup Chile was a wildly successful (at least in terms of branding) programme which enticed entrepreneurs from anywhere in the world to set up startups in Chile with US$40,000 (RM144,439) in seed funding. Most of the money went to ventures operated by non-Chileans.
Private sector accelerator
Operating from a business park in central Kuala Lumpur, 1337 Accelerator offers funding to new and existing startups in mobile apps or connected hardware. It calls itself an accelerator in that if provides mentorship and initial funding in return for a small equity share.
Bikesh “Mike” Lakhmichand
CEO and founder Bikesh “Mike” Lakhmichand, in an interview with KiniBiz, said he did not view MaGIC and other far larger government-funded and run tech startup funds as a threat to privately owned funds such as his.
He said that there is a large pool of talent, “gems in the rough,” in Malaysia hungry for investment. More participants in the tech startup scene would only be benefit the “ecosystem.”
While 1337 may not have as large and imposing a headquarters as MaGIC, he does know that startups would tend to prefer getting funding from a private sector fund rather than on that is government-run as can be seen as a “form of validation” for their business proposal.
The private sector “knows what value is” when it sees it, he said, arguing that the private sector by design is more business savvy.
Government-run startup funds might not have the same business focus, he said. At worst, they might carry the risk of agents operating with a hidden agenda or personal motive.
In one recent case, a startup faced with the choice of private sector funding through 1337 and funding from a government agency, made the choice to accept private money, he shared.
1337 Accelerator is about two years old and is supporting innovations such as a community app to share and view baby photos, a physical device to record customer activity in a retail setting, and the Fit Malaysia app popularised by the Youth and Sports Minister Khairy Jamaluddin.
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