Malaysian Technopreneurship

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Malaysian Technopreneurship

• Opportunities Challenges
• In a Changing Business Landscape.

Presenter S.H.Tan Values First Consulting Sdn.
Bhd.
Conference on MSC Malaysia Cybercity_at_Penang.
Oct 23-24 2007
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Thanks Acknowledgements
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A Brief (Penang) History of Time

• 80s 90s in Penang
• Automation houses
• Subcontract manufacturing
• Foundries, machine shops
• Trading houses, suppliers
• Late 90s
• Dot com bubble - boom bust
• 2000 present
• Web 2.0 revolution
• Online services, resources, expertise
• Globalized localized social networks

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For ICT Technopreneurs, A Shifting Landscape

• 80s 90s
• Opportunity to sell technology to large
  corporations
• Smaller customer base
• Larger sale values
• 2000 Beyond
• Opportunity to sell technology to SMEs as well
• Comparatively low technology penetration
• Huge customer base
• Smaller sale values

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Implications to Small Businesses

• Cheaper to start web-based businesses
• Lower cost of entry due to
• Decreasing cost of technology support services
• Computing power
• Bandwidth
• Storage
• Allows companies to cater for specific niches in
  the global marketplace.
• Build businesses into worldwide brands sooner.
• With Web 2.0, ability to generate revenue sooner.

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What can you sell on the Internet today ?

• Manufactured goods
• Assets Automobiles, Property, Homes
• Personal stuff
• Vacations
• Music
• Artwork
• Software
• Designs
• Stories
• Games points/credits
• Ring tones
• Etc.

The Key is Differentiation!
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Penang/Malaysia has Strong Differentiation Factors

• Industrial/Technical
• Manufacturing
• Medical
• Agricultural
• (Multi) Cultural
• Clothing
• Food
• Music
• Language
• Heritage
• Location
• Tropical (Island) Paradise
• NCER
• Entrepreneural Spirit !
• Air Asia, JobStreet, Maxis

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But Business is also about Competitiveness

• SPEED !
• Quality
• Product Innovation
• Cost Effectiveness
• Marketing Effectiveness/Customer
  Relationships/Support

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We have a lot of Incentives, Really

• GRANTS
• Commercialization of RD Fund (CRDF)
• Cradle Investment Programme (managed by Malaysia
  Venture Capital Management Bhd)
• Demonstrator Application Grant Scheme (DAGS)
• E-Manufacturing Grant
• Engineering Design Grant
• Industry RD Grant Scheme (IGS)
• Intensification of Research in Priority Areas
  (IRPA)
• Market Development Grant (MDG)
• Multimedia Super Corridor Research and
  Development Grant Scheme (MGS)
• RosettaNet Grant
• Technology Acquisition Fund (TAF)
• Technology Acquisition Fund for Women (TAFW)

Source Technopreneur Development Division,
MDeC
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A Lot of Organizations to Assist too

• Organizations that are there to help
• MDeC Grants, Referrals, etc.
• PDC, InvestPenang Umbrella Groups - PAC, SCoPe,
  RFID Business networking, etc.
• PSDC, USM, Disted, MMU, etc. Skills Training,
  Incubation, Joint RD
• MIDA, MATRADE, etc. Exemptions, subsidies.
• FMM, SMIDEC, etc. Industry networking,
  subsidies.
• Microsoft, IBM, etc. Technical/Marketing/Certifi
  cation Initiatives

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Theres no shortage of good, home-grown
technopreneurs either

• Automation Cluster
• www.pac.org.my
• Software Consortium
• www.scope.org.my
• RF Cluster
• www.prfc.org.my

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But there are Challenges

• Funding Implementation
• Funding Criteria
• Too stringent Innovation emphasized over
  marketability
• Implementation Issues with VC Funding
• Institutional VCs not steeped in specific
  industries
• Slow disbursements, too small amounts for
  startups.
• Market Access
• Local
• Exclusionary Tenders
• Ongoing dependence on MNCs
• Foreign
• High Marketing Costs
• Weak Market Presence
• Skills Availability
• Very limited skilled labor pool

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And more Challenges

• Legal Restrictions that inhibit innovation
• Eg. Malaysias Digital Signatures Act limits
  participation in certain ICT services
• Lack of incentives to industry captains to
  participate as angel investors.
• Natural aversion due to high-risk nature of Angel
  funding.

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Technopreneur Wish List 2008

• Cultivate a VC Industry that includes Successful
  Technopreneurs who have been involved in the
  industry understand the market.
• E.g. tax deductions on investments in startups
  e.g. in Japan, Korea, India.
• Provide incentives for Joint RD Projects
  Involving Technopreneur Companies with Other
  Partners
• Income tax exemption for employees of certified
  RD (e.g. MSC status) companies.
• Encourage skilled workers to sign up.
• Foster an Entrepreneural Habitat that encourages
  a learning, experimental, and merit-based culture
  
• E.g. Silicon Valley has a strong, proven culture
  of merit-based social economic system to
  encourage young, immigrant entrepreneurs from
  China India.
• Provide more rewards for risk-taking remove
  stigmas for failure.

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More Wish List for 2008

• Review/Fine-tuning of Laws eg. Digital Signatures
  Act to take advantage of recent technologies
  promote innovation.
• Incentives to Training Institutions to focus more
  on skills upgrading for SMEs.
• More Entrepreneural Courses/Talks in Local Unis.
• Internship for top Malaysian Engineering/Science
  students to Si Valley companies for a year
  followed by assignment to entrepreneural
  ventures.
• Breeding of top-quality technopreneurs.