Malaysia-based Cradle Fund, a not-for-profit early-stage ecosystem influencer and agency under the country’s Ministry of Finance, has announced the addition of six co-equity investment partners.
- Marna Capital Sdn Bhd (Marna)
- Nexea Angels (Nexea)
- 1337 Ventures Sdn Bhd (1337)
- IV Gagasan Sdn Bhd (Infinite Ventures)
- IMJ Investment Partners Pte Ltd (IMJ)
- N Capital Partners Sdn Bhd (NCP)
Each of them will participate in a one-to-one equity co-investment exercise with Cradle , investing up to RM500,000 (US$120,000) in Malaysia-based tech startups.
In total, these partnerships will able to bring in a combined co-investment amount of RM52 million (US$12.4 million)–or RM26 million (US$6.2 million) from each side.
It will also bring its total equity co-investment partners to 19. Cradle’s existing equity co-investment partners include Fatfish Ventures Sdn Bhd, OSK Ventures International Berhad, CoEnt Ventures Partners Ltd, Crystal Horse Investments Pte Ltd, Captii Ventures Pte Ltd, Kahrein Ventures Pte Ltd, KK Fund, Start Up Nation Sdn Bhd, Mercatus Ventures Sdn Bhd, Senior Marketing System Asia Pte Ltd (SMS Asia), East Ventures SEA 2, MOC Capital Berhad (MOCC) and Qeerad Holdings Sdn Bhd.
In addition, it has a grant investment partnership with Golden Gate Ventures.
Cradle raised a total of RM107.2million (US$25.7 million) from the previous four rounds of Cradle’s co-investment partnerships.
The new equity co-investment partners will boost Cradle’s co-investment war chest to RM159.2 million (US$38.1 million).
“Apart from increasing the number of early stage funders, our co-investment partnerships with regional or foreign partners would help these investors notice the talents and potential that we have always had here in the country. As a result, our entrepreneurs will no longer have to cross Malaysian shores to raise regional or global funding in order to scale or place themselves in new markets,” said Nazrin Hassan, Group Chief Executive Officer of Cradle, in an official press release.
Reducing reliance on government funding
Cradle cites reducing reliance on government-linked agencies to provide funding as the reason for scaling up partnerships with private co-investment partners.
It plans to channel 70 per cent of its funding allocation to co-investing initiatives and retain only 30 per cent for direct grants by 2017.
Since the introduction of Cradle’s co-investment partnerships two years ago, three companies— BeMalas, MauKerja and Sync Media—have received a total investment of RM4.025 million (US$964,000). It is in talks to close three new co-investment deals soon.
According to the press release, in its 10-year history, Cradle has funded almost 700 Malaysia-based tech startups through its CIP Catalyst product development grant and CIP500 product commercialisation grant, including ridesharing giant, Grab, and infographic design web tool, Piktochart.