MALAYSIA Venture Capital Management Bhd (Mavcap), which has a fund size of close to RM1 billion, has invested in some 140 companies in the information, communications and technology (ICT) and high-growth sectors.
Chief executive officer Jamaludin Bujang said since the start of its operations in 2001, the government-owned company has directly invested in 69 companies and through its outsource partners programme (OSP).
"We will continue to make direct investments for Mavcap as well as continue the OSP to provide funding to technology companies that have the potential to grow," he told Business Times in an interview recently.
Mavcap, a company under the Minister of Finance Inc, is the country's largest venture capital (VC) company that provides VC funding to Malaysian companies in the ICT and high-growth industries.
One of the successful companies that it has invested in is Tranglo Sdn Bhd. The company provides a peer-to-peer international airtime transfer service which enables mobile subscribers to transfer prepaid airtime from one country to another.
Tranglo, which has operations in Southeast Asia, the Middle East and the Asia-Pacific, entered into a partnership with Mavcap in 2009, a year after the company was established.
"We approached Mavcap as a start-up company with a unique service, that is the airtime service which was rather new in the market at that time.
"We got an initial investment of RM5 million from Mavcap and that money helped us to grow rapidly," said Tranglo chief executive Sia Hui Yong.
The company generated a revenue of RM77 million in 2012, from RM18 million in 2009. It is currently focusing on strengthening its presence in Europe and the United States.
Tranglo saw an increasing number of telecommunication companies and financial institutions, including remittance service providers, using its platform.
This resulted in the visibility of Tranglo as a regional player that attracts potential acquirers from companies interested in geographical presence and not just revenue and profit.
On VC, Jamaludin said there seems to be a lack of liquidity to raise funds from the market at the moment, which is mostly due to the global economic condition.
"The economic situation in the US in the past few years has affected many countries, in terms of raising funds. People are more cautious when it comes to investing in VC funds," he said.
Moving forward, Mavcap will launch its third OSP by year-end.
It will invest up to US$25 million (RM82.25 million) in four VC fund managers that need to raise matching funds from external investors.
This will be the first time the OSP will include both local and overseas partners, which will no doubt help expand the eco-system and provide better exit opportunities for local companies, Jamaludin said.
"We have identified potential partners whom we could work with and we are geared up to make this a success.
"This effort will also allow Mavcap to increase private sector participation in fundraising and reduce reliance on government funds," he added.