pitchIN Equity launches, first issuance in mid-April
By Lum Ka Kay March 17, 2016
- Four companies to raise funds on new ECF platform
- Looking to list at least eight companies by end-2016
MALAYSIA’S crowdfunding pioneer pitchIN has launched its equity crowdfunding (ECF) platform pitchIN Equity, with the first issuance slated to go live in mid-April.
pitchIN Equity has four companies planning to raise funds on its platform: Vocational college KRU Academy; agriculture startup Aqua Genesis; human resource solutions provider KakiTangan; and baby food startup Gastro Baby.
Originally, business news outfit KiniBiz was slated to be amongst the first companies to launch a fundraising drive on pitchIN’s ECF platform.
However the company – a joint venture between its founder P. Gunasegaram and independent news pioneer Malaysiakini – wound down operations in February.
Meanwhile, pitchIN cofounder and chief executive officer Sam Shafie (pic above) said pitchIN Equity welcomes not only tech companies but also non-tech companies.
“The general perception is that ECF is only for tech companies, but that’s not the case. We are looking at any company that is run by capable entrepreneurs, has a scalable business model, and has been generating revenue since Day One.
“Malaysia is an entrepreneurial nation and many leading Asean companies that grew into regional giants started here.
“Savvy investors should be able to find exciting companies to invest on pitchIN Equity upon doing their research,” he said at the official launch of pitchIN Equity in Kuala Lumpur on March 16.
Investors need to make a minimum investment of RM1,000 (US$243 at current rates) on pitchIN equity.
ECF can play a crucial role to spur angel investment in Malaysia, according to Nazrin Hassan, chief executive officer of early stage grant provider Cradle Fund Sdn Bhd, a non-profit company under Malaysia’s Ministry of Finance.
“Equity crowdfunding and angel investment are somehow intertwined, and this will be the first step for investors to get involved in angel investment,” he said.
Six ECF platforms, too crowded
Sam admitted that running an ECF platform in Malaysia would be a challenge, with the Securities Commission Malaysia (SC) having approved five other players in 2015.
However, he was unfazed by the competition.
“It is quite a crowded space, as the Malaysian market is fairly new, but I suppose the fittest will survive and we will be here for the longest time – because we know what works and what doesn’t,” he said.
The other ECF platform operators are Alix Global, Ata Plus, Crowdonomic (now Crowdo), Eureeca, and Propellar Crowd+.
Propellar Crowd+ launched its CrowdPlus.asia platform last November, followed by Crowdo and ATA Plus in January and February this year, respectively.
Sam hinted that pitchIN might venture into other forms of fundraising, such as peer-to-peer (P2P) lending and debt equity.
“We have always positioned ourselves as an alternative funding platform for Malaysians, so obviously we’re always interested in doing all these,” he said.
Lead investors to strengthen confidence
pitchIN launched Malaysia’s first reward-based crowdfunding platform back in 2012, and Sam said it has helped a slew of Malaysian startups raise about RM300,000 (about US$73,000) in total.
“For us, pitchIN Equity is a natural progression in our aim to provide exciting alternative funding services to Malaysians.
“Together with our reward-based platform, we are able to offer funding solutions for any individual, startup and SME (small and medium enterprise),” he told a press conference after the launch.
pitchIN now has 11 lead investors on board including Segnel Ventures, Captii Ventures, Kosciuszko Holdings, VLT, Marna Capital, RHL Ventures, Nexea Angels, and Axiata Digital Innovation Fund (ADIF); as well as angle investors Azrul Reza Aziz, Dr Sivapalan Vivekarajah and Ben Lim.
“If any of these lead investors are interested in a company that is listed on pitchIN Equity, they can lead the way to invest in the company, followed by the crowd,” said Sam.
“And hopefully this would strengthen the public’s confidence on equity crowdfunding,” he added.
Sam said he is looking to have at least eight companies listed on pitchIN Equity’s platform by the end of the year.
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