“We are like gym coaches. We whip them into shape,” remarks MaGIC’s charismatic CEO, Cheryl Yeoh, at a press interview during the programme’s inaugural demo day. “The whole programme is for high-growth startups, so if you are not growing fast enough, no VCs will be interested in your company.”
She is, of course, speaking about MaGIC’s intensive four-month MaGIC Accelerator Programme (MAP), which, has just graduated its first batch of startups.
MaGIC focusses on the commercial viability of the startups, and that means monitoring their growth metrics is a top priority. To accomplish this, MaGIC organises its startups into platoons (much like an actual bootcamp) and hold them accountable to each other.
When everyone is in the same boat, sharing of resources and mutual assistance becomes critical in order to minimise the chances of someone falling behind. The startups meet fortnightly to discuss their progress and the challenges they are facing.
“We do that with community accountability. [For example, we tell them:] ‘You promised your whole platoon you were going to meet your growth metric. [If] you didn’t, why not?’. They also share issues and help each other. For example, if someone is an expert in SEO, they can help the other startup manage their SEO or teach everyone else. We get that real organic willingness to give back, ” says Yeoh.
Besides enabling startups through support groups, MaGIC also brings in mentors — usually Founders or Co-founders — to share their experiences or coach the startups. Notable examples including Anthony Tan from ride-sharing app GrabTaxi and Joel Neoh from fitness-sharing platform KFit.
To qualify as a mentor, these individuals are required to spend at least half a day coaching the startups. This can come in the form of workshops or one-to-one coaching sessions called “office hours”.
Opening up the ecosystem to corporations
For corporations seeking to learn more about the current digital trends in their respective industries, and maybe establish new partnerships in the process, MaGIC can act as bridge. During its “group market days”, corporates or conglomerates from sectors such as the telecommunication or banking industries would come down to MaGIC and check out what its startups have to offer.
“This has become a platform for corporates who want to get into startups but don’t know how to. Through MaGIC, these corporations and GRCs in Malaysia have been exposed to startups and know where to find them right now,” says Yeoh.
Weaving a strong, cohesive regional tech ecosystem
MaGIC’s end game isn’t merely to boost Malaysia’s tech ecosystem and bring in more revenue. It has its sights set on the whole region. It wants to nurture a critical mass of startups that do not only originate from Malaysia.
“You need the critical mass to attract foreign interest i.e. foreign investors. By consolidating them [startups] into one platform across the entire region, it compels investors to come into one place instead of having to [go to] each country. It’s the economics of scale,” says Warren Leow, executive director at MaGIC.
Michelle Tan, Programme Director for MaGIC, mentioned that critical mass is also needed to draw in mentors.
“Mentors need to know that it’s worthwhile. We don’t compensate mentors at all because we believe that mentorship cannot be forced. We see mentors from across the region really having that spirit in them [of] wanting to give back,” she says.
Besides the scale of its programme, Leow also mentioned that it is crucial for the programme to have depth, and to be able to have access and participate in every aspect of nurturing the ecosystem.
“A programme like this is able to bring in market partners across all telcos and across all banks throughout the entire region to engage in building the ecosystem on our platform,” says Leow.
“We create an aircraft carrier that all of you [startups and corporates] can latch on modularly, you decide how you want to participate in the ecosystem. At first it is all about the educational process, then they go into commercial arrangements, business development, revenue sharing, and some look into passive investments and active investments,” he adds.
MaGIC will be seeking to establish partnerships with more Japanese and Chinese conglomerates in the near future. Yeoh believes these partnerships will be crucial in achieving bigger growths for the regional tech ecosystem.
“Going forward, our thesis as an organisation is that we want to have more Japanese and Chinese money coming. So we want to position Malaysia as a platform for a company like Tencent to explore the Southeast Asia, because they are the ones with the capital to eventually acquire startups,” says Yeoh.
On whether MaGIC will launch specific demo days for different verticals, Yeoh says that MaGIC would not be going that route.
“We didn’t want to play that approach in picking verticals because it is very hard to dictate from top down. I firmly believe it has to be market driven. This year, we have a lot of e-commerce startups. Next year we may have more hardware IoT,” Yeoh tells e27
She, however, says that MaGIC is open to organising unofficial demo days with corporations.
“We can organise, for example, a demo day for the banking sector and invite all of our fintech startups to present. But it would be unofficial, it wouldn’t be like this. For our yearly MAP programme, it would be across all verticals,” she says.
Eventually, Yeoh hopes that the private sector will play a bigger role in nurturing the startups.
“As the market matures, people [will] start to understand technology and startups, then the private sector can take over,” she concludes.
The MAP programme will take place biannually and applications for the next cohort will be open in January 2016.
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