The two parties will co-invest in early-stage tech companies in Malaysia and help them to expand overseas with a 1:1 matching scheme.
According to the original article, Cradle and Golden Gate Ventures will fund up to five startups a year with an annual fund size of up to MYR 2.5 million (about US$778,000). Each company will receive up to MYR 500,000 (about US$155,000) in funding.
Nazrin Hassan, CEO, Cradle Fund said that Cradle will provide the same amount as Golden Gate Ventures without taking any equity in the funded company.
Hassan added that entrepreneurs looking to raise funds in Malaysia will no longer have to travel out of the country to find investors.
Furthermore, there are plans to implement such partnerships with local venture capitalists and angel investors. By 2017, Hassan said, Cradle will allocate 50 per cent of its funds for co-investment initiatives.
UPDATE: In conversation with e27, Jeffrey Paine, Founding Partner, Golden Gate Ventures, said, “Based on market size, Malaysia tends to be looked at as a secondary market to invest in, you can tell by the number of investments in larger markets like Vietnam, Indonesia, and Thailand (most recently) and even representative offices being set up.”
Investors, however, have not forgotten Malaysia. In fact, Paine added that the entrepreneurial DNA is very much alive and well. For the record, the firm had previously invested in music video site AtticTV.
He also explained that while Golden Gate Ventures does not look at themes or specific verticals when investing, certain industries, like automotive and financial services, within the enterprise space in Malaysia are definitely worth exploring. He concluded, “… we see that consumer facing startups need to either think regional or global from day one if you are based in smaller markets.”