KUALA LUMPUR: Malaysian entrepreneurs need to start small, think big and move fast to evolve with current trends in the world of venture capitals, startups and new entrepreneurs.
US-based IBM Venture Capital Group’s software strategy director Deborah Magid said a lack of confidence and networking, as well as sharing of information, has impeded growth of new startups among Malaysian technology entrepreneurs.
“The gender bias facing women entrepreneurs, as well as a reluctance to build a strong network in information sharing, has also been a major constraint in the growth of new technology entrepreneurs in Malaysia,” she told a group of selected media here recently.
In this respect, she emphasised the need for a global eco-system to help Malaysian entrepreneurs build great business models that provide innovative solutions to solve problems, in line with the development in new technologies and disruptive industry trends.
Magid was speaking during her presentation on “The Next New Thing: Disruptions In the World of Venture Capitals and Startups”, organised by the Malaysian Global Innovation and Creativity Centre (MaGIC). It was also held in conjunction with the two-day Global Entrepreneurship Community 2016 Summit on Dec 8 and 9 in Kuala Lumpur.
“A new phenomenon is taking place globally with new technologies disrupting traditional businesses such as banking, with the rise of startups that provide solutions to people’s problems in niche specialised areas,” Magid said.
She pointed to recent trends, where startups that provide different business models in line with the needs of industries, are able to grow faster and attract venture capital funds and investors.
“In the global financial technology space, startups or new entrepreneurs that align with young people’s behaviour, are small and nimble enough to move fast in niche areas, have been very successful,” she said.
Magid quoted examples of the current global development of startups in financial technology which provides specialised areas such as cross-border financing and personal financing, which are taking the businesses of banks.
New emerging businesses in financial technology, she said, have become “explosive” recently, with investments growing at a phenomenal phase. “Similarly, startups that solve big problems in the areas of agriculture and food distribution, as well as transport and retail, are reshaping the industries.”
In the Asian market, she said, new emerging boutique businesses are in transport, finance and food delivery.
Valuation of startups, she added, is important, as investors look at business metrics such as revenue, employee numbers, business models of new companies and the management team.
She said it is difficult to get funding and businesses should stop once financing becomes a major issue.
“While IBM does not invest directly in start-ups or venture capital funds, we continue to have a relationship with people who manage funds in the Asian region through programmes that support entrepreneurs,” Magid added.
Meanwhile, Ashran Ghazi, CEO of MaGIC, a government-based organisation to support Malaysian entrepreneurs, said most business ideas from startups are similar and there is a need to expose them to problems and harness energy towards solving it.
“The Global Entrepreneurship Community 2016 Summit in Kuala Lumpur is an ideal platform to build networking for the eco-system of corporates and entrepreneurs,” he said on the sidelines of Magid’s presentation.
The Global Entrepreneurship Community 2016 brings together an ecosystem of influencers, startup communities and industry leaders from all over the world with an eye on collaboration.