Malaysia, known globally known for many things – a vast variety of food, a diverse multicultural demographic, and popular tourist’s destinations are among some of them. To add on to the list, Malaysia has seen a drastic increase in the rise of startups and startup culture in the recent years. The crescendo of startups in Malaysia has become so prevalent, Kuala Lumpur is mentioned in Forbes as one of the top 10 cities in the world to launch startups.
So, what makes Malaysia a great place for startups? What exactly do budding entrepreneurs and investors look for when choosing a nesting site for their businesses in this little country? Let’s look at four reasons that makes Malaysia the best place to initiate your startup.
A government open to business policies
Entrepreneurs throughout the world often look for stable environments to set up shop. A vital part of what makes a stable business environment is a government that is open to business policies. Although known to be conservative in many aspects, Malaysia’s government is open to business policies. Beginning with the Vision 2020 started by previous Prime Minister, Mahathir Mohammed, Malaysia’s business scene opened to investors both local and international within a few years. The MSC (Multimedia Super Corridor) status coined by the premier allows for special privileges for upcoming businesses for the past decade and a half.
Today, Malaysia has set the scene for business opportunities, providing training and strategical courses for upcoming business prospects. Organizations such as MaGIC (Malaysian Global Innovation and Creativity Centre) based in Cyberjaya organize developer trainings and business boot camps for up-and-coming business founders. As a result, startup founders have a sturdy platform to start off with.
This was evident as the country recently saw Jack Ma being appointed as the digital economy advisor to the Malaysian government and said “Malaysia is very business-friendly and much more efficient than I thought” in an article by their local paper.
Abundance of business prospects
As early as the 1400s, Malaysia (or Malaya) has been a prized hub for trade and global export-import. Competition to colonize Malaysia was high due to its abundant commercial potential. With centuries of economic boom, Malaysia’s business scene has evolved to become overflow with premium potential. Integrating the world of apps, services, and products in today’s world, consumers and business entrepreneurs look to Malaysia for prospects. This can clearly be seen in the way Malaysians use apps and services.
The largest companies in the world, some of which are still in startup phase have made Kuala Lumpur one of their headquarters in the Southeast Asian region. Uber, iProperty, and even Google have HQs situated around this bustling metropolis. In the area of property development and soliciting in particular, Malaysia has seen thriving progress of startups. One property startup that saw its business take root in the past year is Bumbung.
Enthusiastic co-founder of the company, Gadiy Lim, highlights the beauty of building a startup in Malaysia. “Malaysia is the best place for startups because it is cheap to validate ideas and start moving” he states. He further acknowledged the lack of local venture capitalists, but noted that it “makes room for foreign investors to come into play”.
More proof of success is shown with the supply-and-demand statistics in Malaysia. As more Malaysians look to apps and electronic means to online services and products, demand for e-commerce businesses and startups potential increases. Every avenue for potential businesses available in Malaysia – be it transport services, food & beverage, online shopping, or even real estate.
A cultural melting-pot
Malaysia has three main races that have lived in harmony since before independence in 1957. Along with a large percentage of other ethnicities and natives, the country has a rich local heritage. This melting pot of cultures creates the perfect medium for expats who are looking to invest time and capital. As a sign of cultural stability, Kuala Lumpur, in particular, caters to a vast multi -racial demographic that, in turn, adds to economic stability. It’s no surprise then that investors and startup founders choose Malaysia as the number one spot to setup their business.
Furthermore, the centrality of Malaysia and how it is situated both geographically and economically in the heart of Southeast Asia, makes it ideal for those who intend to expand their business to the surrounding region. Expats from neighbouring countries such as Indonesia, Thailand, Vietnam and Philippines view Malaysia as the perfect location to work and permanently reside.
CEO of iPrice Group, David Chmelař reiterates that the diversity of cultures in Malaysia makes it an attractive location for startups. “This setting allows for easy integration of other cultures to build a fully-international team”, says Chmelař, who leads a diverse team of over 25 nationalities. Most people think of Singapore as the ideal place to start a business. With its saturation, Singapore loses out to Malaysia in terms of market size. Malaysia is also highly desired due to its developed market where one can test and start their business without much complications.
Another reason Malaysia is a highly-sought-after spot for startups is the boom in young talent. Known as the generation that has the highest level of education, Gen-Y and Millennials contribute tremendously to today’s economy. With the increase in Gen-Y and Millennials, there is no shortage of employees.
These young, enthusiastic individuals add value to the company by contributing fresh ideas as they push for performance. Malaysia’s younger generation, most of which have had tertiary education (both overseas and locally), come home to begin their working life. And where do they start their career path? In startups of course!
The startup culture in Malaysia has been refined in the past years thanks to these four reasons above. Investors and founders of budding businesses in Malaysia are often rewarded thanks to the amazing environment for growth and profitability.
Written by Joel Vijay and images compiled by Jeremy Chew from iPrice Group.