THE 2024 edition of the Malaysia Venture Forum opened on Tuesday (Nov 3) bringing together key stakeholders from the public and private sectors to discuss the future of Malaysia’s venture capital (VC) ecosystem.
The forum was officiated by Datuk Seri Amir Hamzah Azizan, Minister of Finance II, who stressed the role of VC in driving innovation, economic growth, and job creation.
This is the full speech of Amir Hamzah who stressed the importance Malaysia’s venture ecosystem and the need of the system for sustainable growth in the country.
"It is my privilege to address you at the Malaysian Venture Capital Forum 2025 today, an event that stands as a testament to our shared dedicationto drive innovation, foster entrepreneurship, and build an ecosystem that not only fuels economic growth but also creates opportunities for all Malaysians.
Venture Capital: A Critical Lever for Economic Transformation
"Under the Ekonomi MADANI framework, venture capital is a key focus area that aligns with our broader ambition to raise the economic ceiling and expand the nation’s economic pie. By fostering innovation and supporting high-growth start-ups, venture capital not only drives technological progress but also contributes directly to building an inclusive, high-value economy that uplifts all Malaysians.
This strategic emphasis underlines its role as a critical lever in our economic transformation journey.
Across the globe, economies that have successfully scaled their venture capital ecosystems have demonstrated the potential to attract high-quality investments, create high-value jobs, and build industries of the future.
Further to this, developing the venture capital ecosystem drives a pipeline of innovative, high-growth companies into indexes, increasing market's attractiveness to investors. To put this into perspective, in 2022, US VC-backed companies accounted for 42% of conventional IPOs by US issuers, and one in six S&P 500 companies were VC-backed pre-IPO.
This fosters dynamic public market indexes that attract domestic and foreign investment. For instance, the S&P 500 churn rate reached 75% over the past decade, compared to Malaysia’s 33%, reflecting Malaysia’s nascent VC ecosystem.
In 2022, total venture capital funding in Malaysia reached US$758 million, trailing behind both established and emerging Asian hubs like Indonesia (US$3.9 billion) and South Korea (US$9.5 billion). This signals an urgent need for Malaysia to expand its venture capital ecosystem.
Our aspiration, as outlined in the Malaysia Venture Capital Roadmap, is to double our total VC funding value by 2030. While this target is ambitious, it is achievable through concerted efforts and collaboration.
Building People, Entrepreneurs and a Vibrant Ecosystem
"A thriving venture capital ecosystem is not just about funding and growing the economy. Importantly, it is also about building people, unleashing entrepreneurs, and fostering a vibrant ecosystem where the spillover effects help to create sustainable growth.
A lively VC landscape in Malaysia will see more start-ups hiring across different skill levels, creating a wealth of job opportunities for Malaysians, particularly in high-value industries.
This growth enables and encourages continuous talent development and upskilling, strengthening both the workforce and the economy, and lifting the rakyat further up the socioeconomic ladder.
For example, Farm Fresh, a company that has successfully leveraged inclusive economic opportunities to empower rural communities. Seventy-two percent of its employees in farms and rural areas are recruited from underserved communities. Beyond employment, its scholarship programme has opened doors for Orang Asli children, providing them with educational and financial support to uplift their futures.
Equipping Malaysians with the skills and expertise to excel in high-growth industries is therefore paramount, and I urge all players within the ecosystem to prioritise effort in training and development.
This includes fostering entrepreneurship through targeted programs, cultivating technical knowledge, mentoring business leadership, and promoting creativity at every level.
By investing in people or building capacity, we create the conditions for a self-sustaining ecosystem - one where bold ideas are realized, entrepreneurial risk-taking is celebrated, and Malaysia’s start-ups can redefine the future of our economy.
An all-of-Government Approach
"Building capacity is one of three strategic pillars of the Malaysia Venture Capital Roadmap, the other two being Funding and Regulatory Reform.
Launched by the Ministry of Science, Technology and Innovation, MOSTI in April this year, it is a comprehensive blueprint to close the gaps in our ecosystem.
While MOSTI is leading the way with the MVCR, there is a collective all-of-Government approach to support the VC agenda for Malaysia.
At the Ministry of Finance, we are driving initiatives such as GEAR-uP to direct investments into the domestic market by our Government-Linked Investment Companies or GLICs. Together, they have pledged RM120 billion over the next five years towards high-growth and high-value industries, and this includes a substantial focus on VC and start-up funding.
Meanwhile, the KL20 plan under the auspices of the Ministry of Economy is driving 14 initiatives to position Kuala Lumpur as one of the top 20 global start-up hubs by fostering a world-class entrepreneurial ecosystem.
The Ministry of Digital is also playing a key facilitative role by expediting the digitalisation of businesses, equipping start-ups with the tools and technologies they need to thrive in a competitive landscape.
Together, these efforts aim to address the critical gaps in our venture ecosystem, ensuring that Malaysia not only catches up with regional players but emerges as a dynamic hub for innovation and investment.
Budget 2025 Support of Venture Capital and Private Equity
"Further to this, under Budget 2025, several key initiatives have been introduced to strengthen the support system for start-ups and venture capital.
These include the 1 billion ringgit allocation committed through Khazanah’s National Fund-of-Funds, manifested as Jelawang Capital last month. The NFOF aims to support both local and international venture capital fund managers investing in Malaysian start-ups, with 300 million ringgit earmarked for deployment in 2025.
Another 1 billion ringgit has also been committed for KWAP’s Dana Perintis fund, designed to back local start-ups at critical growth stages. For 2025, RM200 million is allocated for deployment.
The Cradle Fund has been apportioned 65 million ringgit to assist start-ups in scaling regionally and globally. This includes 15 million ringgit in matching grants to encourage partnerships between GLCs and start-ups through corporate venture capital initiatives.
To complement these early and growth-stage efforts, the Government is also focusing on mid-sized and more mature companies through private equity initiatives. For this, 6 billion ringgit has been allocated to KWAP’s Dana Pemacu, aimed at scaling Malaysian businesses in critical sectors such as food security, education, and healthcare to name a few.
Similarly, Khazanah’s Mid-Tier Company Initiative, with 1 billion ringgit in funding, is focused on driving the expansion and regional competitiveness of mid-sized companies.
Additionally, to ensure Malaysia remains competitive in attracting foreign venture capital, cross-border approvals under the Foreign Exchange Policy will be simplified, enabling funds to flow efficiently based on their mandate size.
And not least, the Family Office Incentives in Forest City Special Financial Zone aims to attract global wealth and expertise by incentivizing family offices to set up in Johor. Family offices will be required to allocate a portion of their investments domestically, opening up new avenues for funding high-potential start-ups in Malaysia.
Call to Action: Roles in Building a Thriving Venture Capital Ecosystem
"Data from Malaysia’s Securities Commission reveals a critical challenge in our national venture capital landscape: an overreliance on government-related funding. In 2022, government agencies and sovereign wealth funds accounted for nearly two-thirds, or 63%, of total venture capital funding.
While this demonstrates the Government's commitment to nurturing start-ups, it also highlights a gap that must be addressed to ensure the ecosystem’s sustainability and dynamism.
An ecosystem dependent primarily on public funding will struggle to fully mature. This dependency not only limits the growth trajectory of start-ups
as they evolve, but also diminishes Malaysia's attractiveness to seasoned international venture capitalists. These global players bring more than just substantial financial resources; they bring expertise, mentorship, and access to international networks, all of which are invaluable for scaling start-ups to compete on the global stage.
To address this, a diversified funding landscape is essential. The roles of all ecosystem players— GLICs, private sector investors, and start-ups —are pivotal in energizing Malaysia’s nascent venture capital ecosystem and accelerating its evolution.
The Government, through its GLICs, must continue to lead by example, providing both funding and mentorship to seed the development of Malaysia’s VC and start-up ecosystem. However, private sector investors must step up their participation, injecting fresh capital and bringing their market-driven perspectives into venture capital funding.
It is also critical for start-ups themselves to focus on building high-quality business models that attract investments from both local and international players, demonstrating the resilience, scalability, and innovation necessary for long-term success.
Through a shared commitment and a proactive approach from every stakeholder, we can build a venture capital ecosystem that is not only vibrant but also self-sustaining.
Acknowledging Challenges: Risks are a Part of the Journey
"As we expand and strengthen our venture capital ecosystem, it is inevitable that we will encounter challenges, including the inherent risks associated with investing in innovation-driven businesses.
Venture capital, by its nature, is not without uncertainty; it is built on a foundation of high-risk, high-reward decision-making.
We must recognize that there will, predictably, be investments that do not meet their intended outcomes. These are part and parcel of a dynamic venture capital ecosystem.
They should not deter us from taking bold steps forward. Instead, we must view these as opportunities to strengthen our governance frameworks, refine our strategies, and reinforce our resolve to support innovative start-ups that have the potential to transform our economy.
Where we are not successful, we must take our lessons from it and do better. The government stands firmly behind the venture capital ecosystem, and we encourage all stakeholders—investors, entrepreneurs, and the public—to have confidence in our institutions, which remain committed to balancing calculated risk-taking with sound governance.
Closing Remarks
"As we advance, my hope is that we stay guided by the theme of today’s Forum: Reform, Redefine, and Progress. The theme embodies the transformative journey ahead for Malaysia’s venture capital ecosystem.
It is a call to challenge the status quo, embrace bold strategies, and create a dynamic, inclusive, and sustainable ecosystem that drives innovation, uplifts communities, and builds industries of the future.
I look forward to seeing more collaboration amongst all of you here today and your wider network of stakeholders, to invest in the future of Malaysia.
Together, we can build an ecosystem that uplifts our economy, empowers our people, and leaves a lasting legacy for generations to come."
