KUALA LUMPUR (July 25): A report by HSBC and KPMG titled "Emerging Giants in Asia Pacific" has identified 10 potential unicorns in Malaysia.
These companies — which the report dubbed "Emerging Giants" — are Boost Holdings, Exabytes, Jirnexu, Presto Mall, Mindvalley, Neurogine, Eatcosys, Says, Lapasar and PolicyStreet.
In a joint statement on Monday (July 25), HSBC and KPMG noted technology-focused ecosystems are maturing, generating billion-dollar companies at an unprecedented rate as the Asia Pacific region becomes wealthier and more digitally connected.
Head of technology, media and telecommunications at KPMG in Malaysia, Guy Edwards, said Malaysia has developed a good understanding of technology and how innovation works, as evidenced by the many home-grown companies listed in the top 10 leading emerging giants for Malaysia.
"While start-ups are poised to continue playing a major role in the country's development, some may struggle to gain the guidance and business support needed to grow.
"Beyond government support, nurturing the right ecosystem for our local start-ups requires adopting a regional outlook, and encouraging strong collaboration by stakeholders in the space," he said.
HSBC Malaysia head of commercial banking Karel Doshi said the list of emerging giants in Malaysia excites the bank as it is proof that the nation has all the right ingredients for start-ups to flourish and be leaders that shape their industry.
"Financial institutions must be committed to offering start-ups the right support so they can scale beyond Malaysia to be an emerging giant or unicorn," she said.
The "Emerging Giants in Asia Pacific" report by HSBC and KPMG took an in-depth look at 6,472 technology-focused start-ups in 12 Asia Pacific markets with valuations of up to US$500 million.
The report identified 100 leading emerging giants in Asia Pacific that are fast-growing, influential, and innovative with ambitions to achieve the unicorn status and 10 leading emerging giant companies in each market surveyed.
"While there is no specific formula to be an 'Emerging Giant', the companies identified were players in a variety of disciplines, with successful adaptations of their business models based on correct identification of market gaps and a winning culture that attracts and retains talent.
"This includes technology and/or technical knowledge, 'hyper localised' businesses, logistics channels and supply chain operations," said both companies in the statement.
Meanwhile, HSBC and KPMG said total venture capital (VC) funds for the first quarter of 2022 (1Q22) already surpassed 2020 levels.
Citing the Securities Commission Malaysia, they noted that funding is starting to reach a significant level — total committed VC funds hit US$1.2 billion in 2021, up 20% in 2020, and nearly five times more than Malaysian start-ups raised in 2019.
"There has also been an increase in venture capital deals in the region, with record-breaking numbers in 2021.
"Although 2022 looks unlikely to repeat the highs of 2021, 1Q22 figures (US$319 million) suggest that 2022 is on target to exceed both 2020 (US$101 million) and 2019 (US$121 million) funding levels for Asia Pacific as a whole, totalling US$222 million. This is consistent with the investments in Malaysian start-ups," they said.