- How was 2016 like for South East Asia (SEA) startups? Who were the active players in the scene? - A deeper dive into the Malaysian startup scene. So what? and what's next?

1. Southeast Asia and Malaysia Startup Ecosystem
An Overview
Dec 2016
1
By Eric Tan

2. Agenda
2
I) KEY POINTS
II) FUNDING LANDSCAPE IN SOUTHEAST ASIA
III) MALAYSIA ECOSYSTEM DEEP DIVE
IV) KEY NEXT THOUGHTS
CONTACT INFO
For more information, please contact Eric Tan <rictan0@gmail.com>

3. Key Points
3
Number of Deals in SEA dropped significantly but the ecosystem held up with a few mega rounds from the likes of Grab
and GO-JEK. In SEA, most active investors are non-SEA based.
Singapore houses 6 out of 8 most well-funded startups in SEA. 80% of the funding in 2016 went to only 8 startups.
Malaysia grew alongside SEA startup ecosystem in number of deals, but there is a lack of late stage funding, i.e.
83% of 2016 deals are seed stage, and very few active investors.
Since 2013: 154 investments (12.8% of SEA) in Malaysian startup ecosystem totaling $124m (2.7% of SEA).
Median deal size has been stable over years.
Malaysia has been lagging in funding, but strong past M&A performance since 2013,
2 Malaysian companies out of top 5 M&As in SEA by value
Malaysian Entrepreneurship Ecosystem – Long term strategic planning between Public and Private Sector is the key to
success
For more information, please contact Eric Tan <rictan0@gmail.com>

4. 4
FUNDING LANDSCAPE IN SOUTHEAST ASIA

5. Number of Deals in SEA dropped significantly but the ecosystem held up
with a few mega rounds from the likes of Grab and GO-JEK.
5
$555.1m
$848.5m
$1,085.6m
$2,175.2m
223
325
393
266
2013 2014 2015 2016
Funding in SEA Startup Ecosystem (2013-2016)
Deal Size ($m) Deal Count
$0.50m $0.47m
$0.59m
$1.00m
2013 2014 2015 2016
Median Deal Size (2013-2016)
Median Deal Size
Only startups that are backed by angels, seed fund, incubator/accelerators and venture capital are included
Source: Pitchbook; Figures are updated as at 7 Dec 2016
• With global economy slow down, funding
activity in SEA shows sign of slowing down
since its peak in 2015
• Investors are taking a step back and placing
safer bets – number of deals fell after its peak
at 2015 but total funding size increased
staggeringly with CAGR of 41%
SEA
For more information, please contact Eric Tan <rictan0@gmail.com>

6. 129
63
21
54
43
17
24 23
45
19 15 14 14 10 8 8
SEA Investors with 8+ deals in 2016
Number of Deals in the last 5 years
Number of Deals in 2016
Most investors in 2016 are mostly non-SEA based fund
500 Startups was the most active investors in SEA with 45 seed and early Series A deals
6
USA Indonesia China USA Singapore UK Singapore Malaysia
Seed, Series A Seed, Series A Seed, Series A Seed, Series A Seed, Series A,
Series B
Seed Seed, Series A Seed, Series A
HQ
Preferred
Verticals
Preferred
Stage
Recent
Investments
E-Commerce,
EdTech, Fintech,
Mobile, SaaS
E-Commerce,
Mobile, Fintech
AdTech, Big Data, E-
Commerce, Fintech,
SaaS, Mobile
Mobile, SaaS FinTech, Mobile IoT, Big Data, E-
Commerce, Fintech
IoT, Infrastructure, E-
Commerce, Fintech,
Mobile, Big Data
E-Commerce, IoT
Source: Pitchbook; Only disclosed deals are included, Figures are updated as at 7 Dec 2016
SEA
For more information, please contact Eric Tan <rictan0@gmail.com>

7. $1,440m
$550m
$172m $248m
$55m $77m $43m $42m
$750m
$550m
$170m $147m
$43m $40m $35m $35m
Most well-funded SEA-based startups with $30m+ funding in 2016
Total Funding Raised To-date
Funding Raised in 2016
Singapore houses 6 out of 8 SEA most well-funded startup.
80% of the 2016 SEA funding went to 8 startups
7
Singapore Indonesia Singapore Indonesia Singapore Singapore Singapore Singapore
2012 / 1,800+ 2010 / 1,205+ 2009 / 837+ 2009 / 632+ 2013 / 70+ 2010 / 180+ 2013 / 20+ 2012 / 90+
Transportation /
Mobile
Transportation /
Mobile
Gaming / SaaS Marketplace / E-
Commerce
Social / Mobile Enterprise Solution /
SaaS
Aerospace / Satellites Marketplace / E-
Commerce
Sep 2016 Aug 2016 Mar 2016 Apr 2016 Oct 2016 Jun 2016 Mar 2016 Aug 2016
HQ
Founded / #
Employees
Industry /
Vertical
Latest
Round Date
Recent
Investors
undisclosed
SEA
Source: Pitchbook; Only disclosed deals are included, Figures are updated as at 7 Dec 2016
For more information, please contact Eric Tan <rictan0@gmail.com>

8. 8
MALAYSIA ECOSYSTEM DEEP DIVE

9. Since 2013: 154 investments (12.8% of SEA) in Malaysian startup ecosystem
totaling $124m (2.7% of SEA). Median deal size has been stable over years.
9
$0.15m
$0.11m
$0.08m
$0.13m
2013 2014 2015 2016
Median Deal Size (2013-2016)
Median Deal Size
• With global economy slow down, funding
activity in Malaysia shows sign of slowing
down since its peak in 2015
• From 2015 to 2016, number of deals and
total deal size fell by 43% and 37%
respectively, however median deal size
increased by 56%
$9.5m
$33.2m
$47.9m
$33.1m
19
32
63
40
2013 2014 2015 2016
Funding in Malaysia Startup Ecosystem (2013-
2016)
Deal Size ($m) Deal Count
Only startups that are backed by angels, seed fund, incubator/accelerators and venture capital are included
Source: Pitchbook; Figures are updated as at 7 Dec 2016
Malaysia
For more information, please contact Eric Tan <rictan0@gmail.com>

10. Malaysia grew alongside SEA startup ecosystem in number of deals, but
there is a lack of late stage funding, i.e. 83% of 2016 deals are seed stage
10
9%
10%
16%
14%
1.7% 2.6%
4.4%
1.7%
2013 2014 2015 2016
% of Deal Count and Deal Size in Malaysia compared to
the whole of SEA (2013-2016)
% of Deal Count % Deal Size
$0.50m $0.47m
$0.59m
$1.00m
$0.15m $0.11m $0.08m $0.13m
2013 2014 2015 2016
Malaysia against SEA: Median Deal Size (2013-
2016
Median Deal Size ($m) - SEA Median Deal Size ($m) - Malaysia
• Malaysia are still only more active in the smaller
deals – only significant deal size are of the likes
of KFit, which is the only Malaysia-based startup
that raised more than $10m.
• From 2013 to 2016, the gap of median deal size
grew from $0.35m to $0.87m – few Malaysian
startups managed to scale at later stage
• Malaysia startup ecosystem is growing overall
along with SEA, however the total funding in
the ecosystem in Malaysia-based startups
dropped in 2016 compared to the rest of SEA
• Mega rounds out of Indonesia and Singapore,
such as Grab, GO-JEK and Tokopedia, dwarfed
the rest of SEA startups in 2016
$0.87m
$0.35m
Source: Pitchbook; Only disclosed deals are included, Figures are updated as at 7 Dec 2016
Malaysia
For more information, please contact Eric Tan <rictan0@gmail.com>

11. 34
11
17
10 9
7
Most Active Investors in Malaysia in 2016
Number of Deals in the Past 5 Years
Number of Total Investments
In 2016, Two of most active investors in Malaysia are not SEA-based
3 of the most active investors co-invested in many deals
11
Malaysia
USA China Malaysia
Seed, Series A Seed, Series A Seed, Series A
HQ
Preferred
Verticals
Preferred
Stage
E-Commerce,
EdTech, Fintech,
Mobile, SaaS
AdTech, Big Data, E-
Commerce, Fintech,
SaaS, Mobile
IoT, Big Data, E-
Commerce, Fintech
Source: Pitchbook; Only disclosed deals are included, Figures are updated as at 7 Dec 2016
Each involved
in 2 deals
For more information, please contact Eric Tan <rictan0@gmail.com>

12. $15.25m
$4.50m
$3.45m
$2.27m $2.0m $2.35m
$12.0m
$3.0m $2.70m $2.0m $2.0m $2.0m
Most well-funded Malaysian startups with $2m+ funding in 2016
Total Funding To-Date
Funding Raised in 2016
Mar 2016 May 2016 Mar 2016 Jul 2016 Jan 2016 Mar 2016
2015 / 130+ 2012 / 30+ 2015 / 65+ 2013 / 6 2015 / 7 2015 / 25+
Lifestyle / Marketplace Finance / FinTech Solution Services / Marketplace E-commerce / Marketplace Healthcare / Marketplace E-commerce / Marketplace
Latest
Round
Founded / #
Employees
Industry /
Vertical
Investors
5 Marketplace startups tops the funding charts in Malaysia
Majority of them are funded by foreign investors
12
Malaysia
Source: Pitchbook; Only disclosed deals are included, Figures are updated as at 7 Dec 2016
Prince Abdul Qawi
Tuas Capital Partners
Steve Melhuish
Foreign Investor
For more information, please contact Eric Tan <rictan0@gmail.com>

13. Lagging in funding, but strong past M&A performance in Malaysia
2 Malaysian companies out of top 5 M&As in SEA by value
13
Malaysia
Source: “Cheatsheet of startup Acquisitions in Southeast Asia”. Lee, T. December 24, 2015. Available on the Tech in Asia Website,
“https://www.techinasia.com/cheatsheet-of-technology-startup-acquisitions-in-southeast-asia”
Company Amount ($m) Vertical HQ Acquisition Date Acquired By / Merged With
586
Professional
Services
Malaysia 21 Nov 2014
534 Classifieds Malaysia 2 Nov 2015
200 Entertainment Singapore 2 Sep 2013
100 Gaming Singapore 12 Aug 2014
66 Media Singapore 15 Apr 2013
For more information, please contact Eric Tan <rictan0@gmail.com>

14. 14
NEXT THOUGHTS

15. 15
Malaysian Entrepreneurship Ecosystem – Long term strategic planning
between Public and Private Sector is the key to success
Public Sector
Market (Problem, Addressable Market,
Solution, Customer Route to Market)
Startups
FunderAgencies
Regulators
• Innovation will be faster than regulations, regulators need to facilitate
the process (BNM Fintech Sandbox was a great first step)
 Licensing, open data collection, startup-friendly legislation (10-
year tax free!)
 In-border open policy: UK opened up data for startup to disrupt
the public transportation market.
 Cross-border partnership: MAS of SG partnered with India and
South Korea to help SG Blockchain startup to tap into the market
• Great effort thus farfrom MDEC, MTDC, MaGIC, Cradle etc
 Domestic growth – A lot of great initiatives now!
 International Market Expansion – eg International
Enterprise Singapore helps SG startups to tap into foreign
market with networking opportunities
• Academia Partnerships and Mindset Shifts: Universities and
Research Institutes collaborate to educate students to be more
entrepreneurial, more focus on solving problem with
technology, (MDEC & Coursera partnerships is a great step!)
Scaling and Exits Opportunity
• Now relies a lot on foreign VC – is it strategic in the long run?
• What is the long term strategy to build a sustainable funding
ecosystem? How to foster local VC and build an ecosystems of
LPs looking into VC?
• Acquihire/Firesale mindset shift to encourage more
entrepreneurship? – failing is not the end of the world
• How to nurture next generation of Malaysian VC?
• More venture builders now in the market, how to leverage on
this while we grow towards more VC funding ecosystem?
The Future of Malaysia
• Use of technology and creative thinking to solve real inherent
Malaysian problems and add value – not trying to be cool
• Support system - Open platform for knowledge sharing
• Community - connecting successful to budding entrepreneurs,
founders lesson sharing etc
• Play to strengths - Understanding the market and leverage on
competitive advantage
Private Sector
For more information, please contact Eric Tan <rictan0@gmail.com>
Malaysia

16. Next thoughts
16
“Things may finally be changing in Asean, though — in part because the
giant tech companies of China are increasingly expanding beyond their
own borders into the region … … big Chinese internet groups are investing
in start-ups in Southeast Asia out of the belief that their experience is far
more relevant to other emerging markets than the expertise of their US
rivals” – Financial Times, Oct 2016 [Source]
For more information, please contact Eric Tan <rictan0@gmail.com>
“…Today, who really owns Malaysia's new economy? Or the ASEAN new
economy for that matter? Malaysia? Hardly. Malaysian corporations
and agencies need to either get serious about the VC game, or sit at
home, watching others take trophies on their home court, year after
year to come...” – Khailee Ng, Oct 2016 [Source]
i) Are Malaysian startups ready to scale? When will we see later stage growth funding for
Malaysia homegrown startups from local funds?
ii) SEA is a huge market and evidently attracted many foreign VC, but plagued with language and
cultural barriers, how can we help Malaysian Startup to scale within SEA? If not, what will be
the next go-to market expansion?
iii) How do we leverage on foreign VC but not ended up losing all of our startups to them?
• Many founders took foreign VC money at early stage without realising VC money comes
with a lot of pressure as well – so founders need to consider founder-VC fit, what values
does the VC bring to the table other than capital?
Malaysia

17. Contact – Eric Tan
17
@rictan0@rictan0
/rictan0 /rictan0
Background:
Current Interest:
Technology, Entrepreneurship, Venture Capital
- Building great product, team culture and relationships
- Continue to educate myself in technology ecosystem
For more information, please contact Eric Tan <rictan0@gmail.com>