Hong Leong, Malaysian Business Angels Network collaborate to support startups

  • Bank to provide grants to selected startups
  • Developmental programme set up to mentor entrepreneurs
Hong Leong, Malaysian Business Angels Network collaborate to support startups

 

HONG Leong Bank announced on Oct 11, a two-part initiative that sees it collaborating with the Malaysian Business Angel Network (MBAN), the country’s official trade association and governing body for angel investors and clubs, to support the local entrepreneur and startup ecosystem in the technology space.

The first public-private partnership in Malaysia, Hong Leong Bank (HLB) will work with MBAN to support mentorship and developmental programmes for startups through the HLB LaunchPad mentorship- and grant-based programme, which is supported by the Cradle Fund.

“The goal of HLB LaunchPad is to create a win-win partnership by nurturing high-potential digital-savvy startups. This collaboration will also play a role in creating a vibrant entrepreneurial community,” said HLB managing director and chief executive officer Domenic Fuda at the launch.

Mutual benefit
As a bank with a strong foundation in the SME segment, HLB has recognised that banking is changing as more digital technology comes into play. Collaborating with Malaysia’s angel investors and fintech startups will give HLB a leg up into the digital banking technology ecosystem.

“It is important for us to collaborate with MBAN and startups to bring fresh ideas into the bank,” said Fuda.

MBAN will play a major role in the accelerator programme, leveraging on the extensive entrepreneurial and investment experience of its members. President of MBAN Dr Sivapalan Vivekarajah said that the network is very pleased to work with HLB and that it was time for the corporate sector to get more involved with the businesses on the ground.

“Innovation usually happens outside large corporations, which is why many of them acquire small companies and incorporate the innovations. We think HLB is doing it right by becoming part of the innovative entrepreneurship community,” he said, adding that working with and learning from a community is the best way to evolve.

Chief executive officer of Cradle Fund Nazrin Hassan, also present at the launch, said that HLB’s support of MBAN is a landmark move in Malaysia’s startup ecosystem and will ensure more private investments can go to startups while HLB gets more exposure to startups.

Recipe for opportunity
HLB LaunchPad is basically a developmental programme wherein selected startups will receive mentorship from senior HLB executives, business and infrastructure support, and training. It also includes exposure and access to HLB’s local and regional businesses.

Selected startups will receive no-strings-attached grants that can go up to RM25,000 (US$5,987). According to Fuda, HLB is targeting five startups for the first year of the programme (until Oct 2017). The startups will be selected with the help of MBAN.

“Business is not just about technology – it is also about entrepreneurship, marketing, understanding what the customers want. Experience counts for a lot so startups can definitely benefit from the mentorship and development programme,” said Sivapalan.

Meanwhile, besides being able to absorb some change into its work culture, HLB will have the opportunity of access to innovative fintech from these startups.

“Banks are big users of technology and we have experience commercialising ideas, taking them to market and getting people to use the technology. We have a huge customer base and we have data that we can share. There is a whole host of values we can provide beyond just the monetary,” said Fuda.

Beyond that, Fuda said that working with startups will initiate a change of culture within HLB. “Startups approach challenges differently and having exposure to this will enhance our capability to think differently and approach technology and change the way we interact with our customers. The change in mindset will definitely help the bank,” he said.

Beyond funding
Fuda revealed that HLB will be looking for a range of ideas from startups but will focus mainly on digital banking technology that centres on the customer.  Some of the things HLB is looking at are 24-hour banking facilities, cross-selling using big data, and enhancing productivity internally by automating processes.

According to Fuda, this collaboration is the first step in an internal cultural change for HLB. “There is immense value in digitising the whole bank as opposed to just creating a digital department,” he said.

Fuda emphasised that the collaboration will not just bring value to HLB and investors but also to startups. “What I think is of greater value [than funding] is having access to the senior people in the bank, the angels and a wider potential client base. Once the business goes beyond a certain stage, as a Southeast Asian bank, we could work with them to take their products to the region.”
 
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