Can Rais Hussin stamp his mark on Malaysia’s innovation ecosystem?

• Received commitment of sizeable allocation from govt to improve MRANTI
• To leverage 4IR to boost nation’s food production, firm up food security

Whether you like him or dislike him, and his stormy two year stint as the non-executive chairman of Malaysian Digital Economy Corporation (MDEC) made sure that the ecosystem had one opinion or the other, the one thing that Dr Rais Hussin is not, is boring.

And that mainly stems from his candour and natural inclination to tell things as they are. “I am not here to be a curry puff chairman,” he retorted when asked in late 2020 why he was behaving like an executive chairman and overstepping his authority at MDEC. He could have denied, deflected or sugar coated the situation but that is not Rais. Hence the polarizing opinions about him.

And even when an MDEC executive gives him credit, it comes with a sting. “He can bring money to the table as proven by how he convinced CIMB Bank to allocate US$2.12 million (RM10 million) in 2021 for an agritech focused micro-financing programme.”

Such was the success of the program that in 2022 and 2023 the government allocated MDEC funding of RM10 million and US$4.25 million (RM20 million) to expand its agritech drive. “The government has never allocated MDEC funding for agritech before this,” said the executive. “This was down to Rais putting the program together so quickly where it had just been talked and talked about in the past with no action.”

[RM1 = US$0.212]

But the flip side was his interference with the running of MDEC. “He does not know how to run a government agency and his interference was ridiculous,” said the executive, adding, “The legacy of the Discretionary Authority Limit is something we are still living,” referring to a key rule Rais introduced, designed to reduce the financial threshold by which MDEC leaders could make funding/grant decisions. Rais believed the previous system was flawed and had been abused by some MDEC leaders.

Can Rais run a government agency?

Yet, incredibly, Rais now has been given the opportunity to show that he can run a government agency. And, after sitting quiet for almost five months since his surprise appointment as CEO of MRANTI in Oct 2023, Rais held a briefing for the media recently to share some updates while hinting, “there are more exciting and sexy things to come in the near future.”

Bullish choice of words for an executive who has vowed, “we will not spend on anything that has no outcome and impact on society and the nation.” And to emphasise this promise he shared an encounter during his first official public engagement as Chairman of MDEC in late 2020, attending a big launch the agency had at a low cost public housing area with then Prime Minister Muhyiddin Yassin in attendance.

Rais recounts being pulled aside by a resident who took him to a run-down PC room with 40 desktop units. Only 20 were in working condition and even here around 15 had flickering screens.

How great it would be if we could get 40 new PCs instead of having this event, mused the elderly resident to Rais. “His words hit me hard,” said Rais who has since, used the unforgettable encounter to guide him in how to craft and deliver real, meaningful and impactful programs for the country and its citizens and minimize showy spending. That MDEC program cost RM800,000.

One key take-away from the briefing is Rais immediately demonstrating his ability to bring funding in, and this is related to the strong relationships he has with senior leaders of Prime Minister Anwar Ibrahim’s Pakatan Harapan coalition.

Rais basically outlined to the Ministry of Finance and Economy Ministry where the 28-year old park stood in terms of its appeal as an innovation centre for investors in its current ageing state versus the ambitions the government had for it and made the case that proper investments were needed to spruce up MRANTI to be attractive as a world-class innovation hub. So what happened?  

“The government has agreed that holistic upgrades are needed and has allocated quite a sizeable chunk of funding to help upgrade the park’s 686 acre infrastructure,” said Rais who declined to share the amount that will be invested over a three year period.

In terms of his leadership team, while there was quite a bit of flux at MDEC, Rais has taken a supportive approach at MRANTI. “I have an amazing team,” he has said repeatedly, sharing that the only new senior hire has been a procurement ‘tranformationist’ and with perhaps one of two more senior role to be filled.

In a nod to his previous experience at MDEC he said, “I think those who know me, realise that I take governance quite seriously. And in a different agency, I had taken a very robust approach. But not here. We have excellent team that is receptive to changes.”

Innovation to address pain points of nation and citizens

Moving forward, at TiPM (Technology Innovation Park Malaysia) rather than MRANTI, with Rais not finding the name relevant to the innovation mission of the agency (with the official rebranding to be announced soon), Rais shared that, “the mission that has been accepted by the Board is to accelerate demand driven R&D using 4IR to address national challenges.”

The use of 4IR is no coincidence as Rais has co-authored a book in 2019 ‘4IR – Reinventing A Nation”. He also shared that MRANTI has been appointed by Mosti as an agency responsible to facilitate addressing food security using 4IR, “so we are working very very hard in this area because Malaysia’s food bill in 2023 was around RM72 billion, excluding excluding dried and processed food.”

No firm plans have been laid out by MRANTI in this regard yet with Rais looking to Qatar for inspiration. The tiny nation made a dramatic transformation from importing most of its food needs to becoming an exporter of foods, all by relying on 4IR technologies. Two teams will be sent to Qatar to learn from the desert nation.

Rais stresses that the MRANTI approach is not just about copying others. “Innovation must address the pain points of the nation,” he said while highlighting that around 97% of people want five things in their lives – affordable cost of living; affordable and quality healthcare/education/housing and dignified jobs.

“These are the pain points we need to identify going forward while positioning Malaysia as a nucleus of innovation and a leading technology producing nation.”

No doubt these are ambitious goals for Rais and MRANTI, bearing in mind the reality that the pace of innovation in the country cannot be moved much by the agency on its own, with its model of partnering startups, the private sector and academia in their innovative pursuits while enticing regional and international corporates to locate their innovation centres at MRANTI, leveraging its 686 acre landbank to earn revenue.

For example, MRANTI hosts a drone and an autonomous vehicle testing area on 5G. But while the facilities are provided, usage of the two test zones entirely depends on ecosystem players ie entrepreneurs, corporates and academics for their testing. MRANTI has no funds or grants to give out, nor does it have valuable IP or researchers that it can share with ecosystem partners.

That is the reality that Rais faces as he promises “exciting and sexy” developments to come and states that the target for 2024 is to see revenue grow 29% while maintaining positive EBITDA versus 2023 revenue of RM126.2 million with RM17.5 million EBITDA.

Chinese investments coming in

Some of the exciting developments to come stem from a Dec 2023 trip to China, visiting some leading companies there, including Geely, pitching MRANTI to them. Out of this trip Rais expects two universities to open campus branches, one AI company to establish operations with another company launching an innovation centre at MRANTI.

A more immediate development that he is excited about, and it’s because it cost him nothing to put together is an AI capacity development program that will be launched by a global tech company, believed to be Nvidia, with 10,000 university students offered the program for free to enhance their job prospects with another 1,000 spots for startups.

This project also is illustrative of how Rais can move decisively and cut through layers. The tech company had been trying to offer the AI skilling project to the government for years. Rais organized a meeting between them and his chairperson, Prof Dr Rofina Yasmin Othman and agreed to support the project on the spot. Rais then asked the executive to keep his late night free and that same evening brought Minister of Higher Education, Dr Zambry Abdul Kadir to a meeting with Zambry also throwing his support behind the initiative.

The launch will see both Zambry and Chang Lee Kang, the Minister of Science, Technology, and Innovation in attendance. Rais’ agency sits under Chang’s portfolio. “I am Mr Zero capex,” quipped Rais of the project that will be launched end April.

The greatest challenge

Despite some early wins, Rais is under no illusions on the size of the challenge ahead in moving the innovation needle for the country. The trip to China and especially the innovation park, Zhongguancun Science Park (Z-Park) in Beijing has given him a sense of the huge challenge ahead.

While just one of many innovation parks in the greater Beijing area, the park has been home to an astounding 108 unicorns, with an array of top local and international companies as tenants. “Every visit to the park left me feeling depressed back at the hotel,” said Rais who wistfully recalled a time Malaysia was ahead of China (before it opened its borders and joined the WTO in 2001.) But now we are 30 to 40 years behind them.”

Where are we not doing the right thing? What are they doing that we cannot do? These were the questions that were swirling in his mind. But the one constant answer Rais would get from his Chinese hosts was this. “Their success lay in the top down approach the country took to innovation. It is infused into all the verticals they then want to be leaders in,” said Rais.

Trying to replicate this within the Malaysian context and capabilities of its entrepreneurs, its companies and researchers, will be Rais’ greatest challenge and one which will ensure many sleepless nights for him.