Venture capital firm Gobi Partners is bullish on Malaysia’s tech ecosystem and is ready to deploy RM100 million ($24 million) in the next two to three years to invest in the country’s startups, its chairman and founding partner said.
“We think Malaysia has one of the best tech ecosystems in the entire Southeast Asian region,” Thomas Tsao told reporters at an event. “We see more and more interests from north Asia coming down into Southeast Asia.”
The Shanghai and Kuala Lumpur-headquartered firm is looking at sectors such as agritech, artificial intelligence, circular economy, logistics and Taqwatech (Muslim-focused tech). It is also interested in supporting women entrepreneurs.
“We are also looking at Taqwatech. We are looking at startups that are using technology that can serve the global Muslim community. We think Malaysia is perfectly positioned for that,” he said.
According to Tsao, Malaysia is a “superconnector”, connecting five huge market opportunities – those from Indonesia, China, India, Western countries and Muslim markets – due to its diverse culture.
“Our office now in Malaysia is the biggest in the Gobi network. Since 2015, we have deployed close to RM200 million,” he said, adding that the “RM200 million invested on paper is now worth more than RM400 million.”
Gobi Partners has investments in companies such as used car dealer Carsome, financial products comparison site Ringgitplus, and courier services company EasyParcel, among others.
Despite the COVID-19 outbreak, Tsao said Gobi continued to invest, arguing that the best companies are being formed during difficult times.
“We think it’s a great time to deploy capital. Adversity and pressure create great companies…We think that companies we invested during this kind of period will generate a lot of values, high long-term value.”
Tsao was speaking at the SuperSeed II Championship, an online pitching competition organised by Gobi Partners and Malaysia Digital Economy Corporation (MDEC)
The four winners of the online event were property transactions platform Speedhome; digital wallet for migrant workers operator MyCashOnline; pre-owned goods e-commerce marketplace Lokein; and StixFresh, inventor of stickers coated with plant-based compound that increase fruits’ shelf life.
These four startups will have the opportunity to be part of Gobi’s portfolio SuperSeed Fund II, which was launched last year.
Superseed Fund II is aimed at startups in several business sectors, and the firm is targeting 25 to 30 investments for the fund. Median ticket sizes are approximately $250,000.
Gobi Partners is a venture capital firm with a pan-Asian presence across North Asia, South Asia and Asean with over $1.1 billion in assets under management. Founded in 2002, Gobi has raised 13 funds to date, and has invested in more than 250 startups.
In December last year, Gobi Partners closed its 2017-vintage Meranti ASEAN Growth Fund after meeting its $200 million target. The firm announced the fund’s first close at $50 million in August 2017.
The VC firm plans to build a portfolio of 15 companies or more, with investment ticket sizes ranging from $5 million to $20 million per transaction.