Cradle Fund raises RM190m with more partners

KUALA LUMPUR: Cradle Fund Sdn Bhd, an agency under the Finance Ministry, has raised a total of RM190.2 million for its co-investment fund following the inclusion of six more partners.
The six partners – EIX Group Sdn Bhd, Biz Angel Network, RHL Ventures, TinkBig Venture, Segnel Ventures and PlatCom Ventures Sdn Bhd – collectively bring about RM14.5 million into the co-investment partnership.
“We are delighted that there are investors still open to work together with Cradle, to seek opportunities in co-investing as we see the number of partners have now grown to 32 with total committed funds of RM190.2 million,” Cradle CEO Nazrin Hassan said at a press conference here yesterday.
“We do hope that this will convert into investments especially with the flip side of the regional slowdown, where valuations are coming down to a more palatable level,” he added.
Nazrin said having new partners would provide Cradle a huge opportunity to learn and tap the partners’ diverse experience as it would bring an advantage to the Malaysian start-up scene as they prepare to become global players.
“This partnership takes our relationships to a whole new level. Our partners would give us additional insights and experience investing in start-ups which Cradle may not have,” he said.
Meanwhile, Nazrin said the investment scene this year has been quite slow compared with last year, as some investors have become very cautious in making new investments, a phenomenon which has affected investments into startups.
This has moved Cradle to focus on trying to analyse the problem and exploring ways to encourage investments in startups to help spur the ecosystem.
“With this, starting next year, Cradle will be introducing direct equity investments. This is one of the way for the organisation to explore other solutions to still encourage investments in Malaysian startups.”
“Not only will it give Cradle the opportunity to follow on co-investment deals but to directly lead the round of funding,” he noted.
The co-investment programme, which was introduced in 2014, is one of Cradle’s efforts in supporting the government to reduce government-linked agencies’ dependence on government funding and encourage more private investments into funding local technology start-ups.
Under this effort, Cradle will channel 50% of its funding allocation to co-investing initiatives and the remaining 50% for direct grants.
Cradle’s co-investment programme has so far funded four start-up companies, namely BeMalas, MauKerja, Sync Media and SupplyCart, with a total investment of RM6.07 million.
Since its inception, Cradle has funded over 700 Malaysian tech startups through its Cradle Investment Programme (CIP) Catalyst product development grant and its CIP500 product commercialisation grant.