Malaysia floats 'Golden Pass' scheme to attract unicorn start-ups & venture capitalists

Malaysia has floated a ‘Golden Pass’ scheme to attract unicorn start-ups and venture capitalists (VCs) in a bid to establish the country as the business hub of Southeast Asia and create high-skilled and high-value jobs.

In addition to attracting unicorns and VCs, the Malaysian government has also introduced the Innovation Pass and Innovation Belt to widen the pool of high-skilled professionals, GPU Scheme for artificial intelligence (AI)-centric start-ups, and the Single Window system as a one-stop centre for information and application under the various schemes, according to the Malaysian newspaper The Star.

The paper quoted Malaysian Economy Minister Rafizi Ramli as saying that these schemes have gone live with immediate effect.

Exemptions from fees & visa, subsidies on offer to unicorns, VCs

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The Malaysian government has offered a range of benefits for unicorns and VCs to set shop in the country. A unicorn is a start-up valued above $1 billion.

For the unicorns, the Malaysian government has offered exemption of fees for senior management executives, subsidies for rent, and tax concessions, according to the Nikkei Asia.

For the VCs, the report said that the government has exempted work visa for senior executives, expedited license approval for fund set-ups.

Not all VCs are, however, eligible. Only those VCs which manage assets more than $100 million and have a “strong track record of investing in and scaling successful tech startups” are eligible, according to the report.

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“We are offering a series of incentives, including LP (limited partner) funding access opportunities, subsidized office spaces, expedited license registrations, and exempted fees for employment passes,” the report quoted Rafizi as saying.

‘We’ll make Malaysia Southeast Asia’s base for global companies’

Rafizi has said that the government plans to make Malaysia as the hub of technology companies in Southeast Asia with these schemes.

In his keynote address during the KL20 Summit at the national capital Kuala Lumpur, Rafizi on Monday said the scheme are also intended to develop a future generation of entrepreneaurs in Malaysia.

“With the right investors and the right talent in Malaysia, we will make Malaysia the Southeast Asian base for global technology companies under the Unicorn Golden Pass. We want to attract global unicorns to enter Malaysia so that high-skilled and high-value jobs are created, besides developing a pipeline of future entrepreneurs and senior leaders in tech,” said Rafizi, as per The Star.

Rafizi said the government has the ambition to make Malaysia one of the top 20 start-up ecosystems in the world.

“The ambition is for Malaysia to be the choice destination for early-stage and growth capital; to be the centre for world-class entrepreneurs and skilled talent; and to be the home for world-leading startups looking to start, grow, and scale,” said Rafizi.

In his address, Rafizi highlighted the advantages that Malaysia has, such as being already connected to some of the biggest markets of the world.

“Malaysia is closely linked geographically and culturally to the largest markets in the world: Southeast Asia, East Asia, India, and the Middle East. Our diverse domestic population, combined with high-quality digital amenities and affordable cost, makes us an ideal testbed for product launches and pilots,” said Rafizi, adding that the country is the “gateway to the east”.

Incentives for semiconductor plants, AI start-ups

Besides floating incentives for VCs and unicorn start-ups, the Malaysian government has also floated schemes to establish semi-conductor ecosystem in the country.

The Star quoted Rafizi as saying that, even with all these incentives, the country will not be able to attracted the best companies and talents if “artificial intelligence infrastructure is not well supported” in the country. To address this, he said the government will focus on securing greater capacity of high-computer chips within its data centres.

Separately, Malaysian Prime Minister Anwar Ibrahim announced the establishment of semiconductor plants near Kuala Lumpur, according to Nikkei Asia.

The report said that Anwar announced the setting up of an integrated chip design hub near Kuala Lumpur. The companies setting up operations in the hub are Phison Electronics’ new venture MaiStorage, ARM Holdings, Malaysian chip design solutions company SkyeChip, and Shenzhen Semiconductor Industry Association, as per the report.

Laying out his government’s approach, Anwar further said, “We are positioning Malaysia as an axis for leaders in semiconductors, clean energy, agritech and Islamic fintech. Doubling down on our edge will tap into the higher-value effort to create new growth verticals and transform our fortunes.”