KUALA LUMPUR (July 27) In a move to bolster Malaysia’s technology ecosystem, ViTrox Corp Bhd’s (KL:VITROX) co-founders are partnering with private equity firm Southern Capital Group to create a venture capital fund.
Dubbed the Cambrian Fund, it aims to support local tech startups and nurture a robust tech ecosystem in Malaysia. The fund will focus on the Industrial 4.0 themes, including vision artificial intelligence and robotics.
It aims to invest in early-stage tech companies whose founders have the right mindset, compelling vision, and exceptional execution capabilities necessary to achieve market leadership and success in a dynamic and competitive global environment. The fund intends to cast a wider net to attract other industry leaders and key stakeholders into the fund's ecosystem.
The fund, which will be launched in October this year, is targeting to raise RM150 million, of which RM60 million is to be secured from ViTrox founders and Southern Capital. ViTrox's founders are Chu Jenn Weng, Steven Siaw Kok Tiong, and Yeoh Shih Hoong.
Speaking at a pre-launch of the Cambrian Fund, Chu said Malaysia has the potential to become the Silicon Vallley of the East. He emphasised that achieving this vision requires industry players to contribute their knowledge and expertise, as well as increased investment from those who share the goal of strengthening the local tech ecosystem.
“Southeast Asia is poised for significant growth and we see unique opportunities to foster local tech companies and create global champions. Our initiative aligns with the National Semiconductor Strategy, which aims to cultivate a dynamic ecosystem and establish at least 10 Malaysian tech companies with over RM1 billion in revenue,” said Chu, who is also president, managing director and chief executive officer of ViTrox.
“We are investing in this fund because the market is huge, we want to make [tech] clusters and make sure we can do global business together,” he added.
Chu is the largest shareholder in Penang-based ViTrox with a 26.44% stake. The group produces machinery and equipment designed to automate the rigorous testing of semiconductor devices.
On the inspiration of the fund, Southern Capital Group managing director Kenneth Tan said there is currently a remarkable investment opportunity that lies in supporting startups and growth companies in the region's technology ecosystem.
He highlighted that Penang is an excellent destination that boasts strong infrastructure, a highly educated and motivated workforce, and successful companies founded by entrepreneurs, which create significant investment opportunities.
“Permanent dislocations in global supply chains due to geopolitical changes have led to tremendous prospects for local operators and entrepreneurs to achieve massive growth, but this requires networks, knowledge and capital.
"Southern Capital is excited to have the founders of Vitrox as limited partners and allies in this transformative venture. We share the same values and vision, aiming to leverage our collective experience and knowledge to help others achieve significant returns and growth,” Tan added.
Meanwhile, ViTrox co-founder Steven Siaw Kok Tong said what sets the Cambrian Fund apart from others is the involvement of relevant industry leaders as investors. This expertise enables the companies receiving funding to mitigate risks or reduce unnecessary mistakes and effectively identify opportunities.
He added that other funds may lack familiarity with the industry and do not have the relevant expertise to add value.