Malaysia may have an idea that will help startups, which typically do not have much funding or experience, as well as more established firms, which are often afraid of disruption from new competitors.
Companies in the Southeast Asian nation are pairing up, with newer and older companies coming together to benefit from each other’s strengths and to help each other get past their weaknesses. The model could become an interesting trend across the region, as Malaysia is the most developed economy in the Association of Southeast Asian Nations after Singapore, and it has given birth to a range of companies that have expanded their operations to other countries, from startups such as ride-hailing app Grab to large companies like AirAsia.
Multinational consulting firm PwC’s Malaysian operation, for instance, has paired with startups such as Supahands, which uses machine learning to help clients analyze big data, online commerce firm Dropee, and affiliate marketing firm Involve Asia.
“They have demonstrated commitment and tenacity in learning and exchanging knowledge with the PwC partners they were paired with,” Sridharan Nair, PwC Malaysia managing partner, said of the startups. “The insights they brought to our partners in the program were invaluable to PwC, as it deepens our understanding of the investments they have made in digitizing their organizations and their approach in disrupting the business.”
The startups were able to use PwC partners’ expertise on subjects such as financing and initial public offerings. At the same time, it is useful for large companies to see how smaller ones are experimenting. With a heavy focus on compliance, companies such as PwC have to go through more approvals and bureaucracy, which may not make them as nimble as a startup.
Supporters see such two-way mentorships as a way for the emerging market to develop.
“With many Malaysian startups now growing into global market players, we feel it’s necessary for there to be more similar programs that can impart world-class business acumen to our base of upcoming entrepreneurs,” according to Norhizam Abdul Kadir, vice president of growth ecosystem development at the Malaysia Digital Economy Corp., a government agency whose mission is to promote the digital economy.
Boost to economy
The partnerships are one idea to stir up an economy that could use a boost. Malaysia’s third-quarter consumption and exports did not grow as much as optimists had hoped, and the nation is waiting for the United States and China to resolve their trade war, which hurts demand for Malaysia’s products.
At the same time, Malaysia has lowered poverty and is working toward official status as a high-income country. Its role as the host of next year’s Asia-Pacific Economic Cooperation summit may give it more influence over trends in Southeast Asia.
“In recent research from the World Economic Forum, Malaysia ranks third in the world for companies embracing disruptive ideas and fourth overall for its entrepreneurial culture,” said Nic Chambers, regional director of Michael Page Malaysia, a human resource consulting firm. “The local business community enjoys the benefits of government initiatives such as the Industrial Revolution 4.0, which promotes automation and attracts new investment into the country.”