Launch of MaGIC ignites slew of partnerships
By Gabey Goh April 28, 2014
- Multiple partnerships signed in conjunction with launch to boost ecosytem
- CEO looking for good people to join team, applications of interest welcome
THE Malaysian Global Innovation and Creativity Centre (MaGIC) in Cyberjaya was officially launched with much fanfare on April 27, serving as a strong signal of the Government’s commitment to the development and growth of entrepreneurs.
MaGIC was first announced at the fourth Global Entrepreneurship Summit (GES) in Kuala Lumpur last October, and in his Budget 2014 proposal later that month, Prime Minister Najib Razak announced an RM50-million (US$15.3-million) allocation for it.
MaGIC's official launch also coincided with the visit of US President, Barack Obama (pic) to Malaysia, the first sitting president to do so since Lyndon B. Johnson in 1966.
During his speech to attendees at the launch event, Obama recalled how five years ago he called for a new partnership between the United States and Muslim communities around the world.
“So often the conversation between the United States and Muslim communities was around security issues, but the truth is, day to day what people are concerned about is jobs and businesses and improving [the] quality of life for themselves and their families.
“And that was not enough of a conversation that was taking place,” he said, adding that MaGIC was the result of GES taking place in Malaysia last year.
Obama said that it is young people who are going to be creating all kinds of amazing things when they get older.
“And the fact that this centre is giving them the opportunity to learn computer coding early on, understanding that computer sciences and IT are going to be one of the keys to future growth, I think is a testament to some outstanding investments by the people of Malaysia in the next generation.
“I’m very excited to see what’s going to happen not only with the entrepreneurs here in the future, but these young people and the remarkable things they’ll do to help Malaysia grow, help the region grow, and help the world grow,” he said.
Coinciding with the launch of MaGIC, a slew of partnerships were signed, aimed at boosting the country’s entrepreneur ecosystem, at a ceremony took place on April 25.
The ceremony was witnessed by Najib, who in his opening remarks; expressed his strong belief in the potential of the nation’s youth.
“I believe in young people, in their passion, energy and creativity. We as the Government have got to create opportunities for them, and how do we go about that? By building an ecosystem that allows them to succeed, that allows them to build dreams, businesses and industries. And that is what MaGIC is about,” he said.
Secretary-General of the Treasury at the Ministry of Finance and MaGIC chairman Dr Mohd Irwan Serigar Abdullah said that the centre is aimed at boosting the skills and opportunities of Malaysian entrepreneurs in “every way possible” to enable to compete on a global stage.
As part of this mission, MaGIC is forging a collaborative partnership with two American organisations: UP Global and Stanford University.
MaGIC chief executive officer Cheryl Yeoh (pic) said that these partnerships will augment the creation of a “dynamic entrepreneurial nation by enabling domestic and international entrepreneurs to grow," with MaGIC being the catalyst.
“I am proud to ignite collaboration between MaGIC and established organisations in the United States on the innovation front, as this will further accelerate our efforts in growing and building great entrepreneurs,” she said.
Two of Standford’s schools will be collaborating with MaGIC, namely the Stanford Graduate School of Business (GSB) and the Stanford School of Engineering, facilitated by the Stanford Centre for Professional Development.
In addition, the Standford Technology Ventures Programme will engage with Malaysian university faculties in curriculum development.
Other components of the programme will bring Stanford faculty to MaGIC to help a select group of entrepreneurs take their ideas to market. MaGIC will also send a group of entrepreneurs to Stanford University in California where they will learn best practices and mind-sets from Silicon Valley.
The partnership with non-profit organisation UP Global is intended to increase the level of entrepreneurial activity and new company creation in Malaysia, to develop the country as a global startup hub and a centre of activity for South-East Asia.
It also aims to connect Malaysian entrepreneurs with international communities and highlight Malaysian startups in the global arena. Under this partnership some activities, and programmes include Startup Weekend, NEXT and Startup Digest.
This initiative targets supporting 5,000 new entrepreneurs within a year, and will include uniting the startup community by hosting the UP Global Summit on a national and regional level.
Boosting deal flows
In conjunction with the launch of MaGIC, partnerships were also announced by Malaysia Venture Capital Management Berhad (Mavcap) with Elixir Capital Management and 500 Durians LP for Mavcap's third Outsourced Partners Programme (OSP3).
An agreement was signed between Mavcap and Silicon Valley-based fund manager Elixir to launch the ECM Straits Fund, which will target growth equity investment opportunities to help scale up small-to-medium enterprises (SMEs) in the region.
The fund, which currently has a commitment of US$50 million with a target of US$150 million, represents the first of the partnerships targeted to be signed under OSP3.
Under OSP3, Mavcap company is committed to investing up to US$100 million with up to four partners, who in turn are required to raise a matching amount of US$25 million or more.
Mavcap chief executive officer Jamaludin Bujang said that the decision to partner with Elixir was based on the fund manager’s "extensive experience" in private equity society, as well as its "deep network" of fund managers and companies operating across the globe.
“We believe that its focus on growth equity investment opportunities is one of the best ways to provide exit avenues to our investee companies and give them exposure to a wider market, and thus command higher valuations,” he said.
Commenting on the partnership, Elixir’s managing director Abrar Hussain said he envisions strong links between Silicon Valley and unique growth opportunities available in Malaysia, where the fund has established an office, and the rest of South-East Asia.
“One of the most interesting things and most important realisations as an investor during my travels in this region is the fact that the future is already here, but it’s not very evenly distributed.
“That’s really what this institution and bridge-building is all about, it’s about bringing the future here. We’re excited to find companies and help them grow and take it to the next stage,” he said.
Abrar said that by partnering with Mavcap to help create an ecosystem that connects entrepreneurs with mentors, customers and business partners that would otherwise be out of reach, the fund hopes to foster innovation and create job opportunities, building stronger economic bonds between the United States and the region
Mavcap also signed a Limited Partnership Agreement with 500 Durians, a local fund managed by California-based seed accelerator 500 Startups that invests in startups in South-East Asia.
The partnership will see Mavcap committing US$5 million into the reported US$10 million fund, which was launched in early 2013.
Representing 500 Startups, venture partner Khailee Ng said the initiative was targeted specifically at digital startups in the region.
“We see much potential in the region and with our base in Malaysia, we are looking at investing in startups here as well as in Thailand, Vietnam, Singapore, the Philippines and Indonesia, as there are the next emerging hotspots for digital startups,” he said.
MaGIC still in the making
MaGIC's Yeoh has only held the position for just over two weeks, and would not be rushed into defining what the centre and her mandate will be.
“Give me some time, I want to connect the dots, elevate and expose what’s already out there. I feel there is already a lot of things in our ecosystem, but there could be points where there is a ‘breakage’ in the loop currently in place, and I hope to identify what these gaps are,” she said.
Yeoh believes that while the role that the Government currently plays in the startup ecosystem is vital, it has to be replaced by the private sector eventually.
“The Government can’t subsidise things forever but the key is sustainability, how you develop the ecosystem to the point where it can sustain itself. We’re essentially thinking about how to replace ourselves and a lot can still be done,” she said.
If there is one mission close to her heart, it is to find as many outstanding Malaysian startups as she can and help expose them to not just the nation but the world as well.
“I think that’s definitely one area we can improve upon; there are Malaysian startups doing great work that are already global, but no one knows about them. I hope to find them and expose them to the world,” she said.
Asked whether she foresees MaGIC playing an active role in lobbying and campaigning to influence or inform new government policies on a national level, Yeoh said that once her own research into the ecosystem is complete, she intends to do so.
“Once I have identified that gaps, I am certainly going to submit policy recommendations to the Government. I am already speaking to people on the ground to help form my own recommendations,” she said.
The number of staff at MaGIC currently stands at the grand total of one -- Yeoh herself. She is currently being supported by outsourced staff resources with two assistants on contract, but is actively looking to add to the MaGIC team.
“MaGIC can only be as good as its people, and I need all the help I can get. As I work to solidify what our charter and purpose is, I’ll soon have a list of ob positions we need to fill." she said.
Interested candidates are encouraged to send their applications via the MaGIC website, stating their areas of interest.
“We will need your support to make things happen and I hope that people will apply for the right reasons,” Yeoh said.