This article first appeared in Forum, The Edge Malaysia Weekly on August 24, 2026 - August 30, 2026

Penang has long been recognised as the heart of Malaysia’s semiconductor ecosystem. More impressively, its capabilities have transitioned beyond simple assembly and manufacturing into higher-value activities such as semiconductor design, advanced packaging and testing, automation, specialised equipment, as well as cutting-edge research and development. These have helped earn Penang accolades as the “Silicon Valley of the East”.

The industry outlook is also promising and of strategic importance to Malaysia. Semiconductors power the next generation of technologies that will shape the modern economy. This includes everything from artificial intelligence and data centres to electric vehicles, medical devices, advanced manufacturing and renewable energy systems.

With Malaysia already occupying a vital position within the global semiconductor value chain, the government has rightly prioritised deepening our capabilities in higher-value segments. This means encouraging more home-grown companies to develop intellectual property, commercialise technology and expand internationally.

Realising such ambitions requires significant investment. On my trip to Penang earlier this year, industry leaders shared the challenges of scaling up, which includes continuously investing in research, talent, equipment and technological capabilities.

At the Securities Commission Malaysia’s inaugural semiconductor industry financing roadshow in Penang on Aug 19, we brought together the companies, investors, market intermediaries and ecosystem partners to address a critical question: How can Malaysia’s capital market better support the global semiconductor value chain and our domestic champions?

We believe it means accessing the right capital from the right source — one that suits the semiconductor entrepreneurs’ current stage of growth.

For normal businesses, traditional financing has typically been the go-to avenue for expansion. However, in terms of funding the next leap forward or even breakthrough innovation, bank financing has limitations.

This is where the capital market can complement traditional financing sources. It offers a diverse range of funding pathways that can meet unique development requirements such as lengthy development cycles, substantial capital expenditure or projects with long gestation periods. Such needs require the right fit.

For example, an early-stage semiconductor design company may utilise patient, risk-tolerant capital to fund product development and commercialisation. Separately, an established equipment manufacturer requires growth capital to expand capacity, acquire technology or enter new markets. At the other end of the scale, a more mature company can access the public market to fund its regional or global ambitions.

For global semiconductor supply chain players, this is the opportunity to understand the different market-based financing solutions available, what investors look for and how to prepare for the fundraising process.

For growing and early-stage businesses, this means recognising that equity crowdfunding (ECF), peer-to-peer (P2P) financing and venture capital are likely options and identifying which is more suited for the business’ needs. Conversely, the equity market as well as corporate bonds and sukuk may be more appealing prospects for businesses looking to scale further.

For investors and capital market intermediaries, this platform is also designed to increase visibility on the capabilities, ambitions and financing requirements of industry players as well as the broader semiconductor ecosystem. Our business matching and sharing sessions aim to provide better insights on individual company needs and funding requirements.

The right investor can offer strategic guidance, stronger governance, industry networks and access to new customers and opportunities. This type of value-add can be even more important than the funding itself.

Therefore, it is essential for companies to identify the type of capital partner that can best support their long-term ambitions.

Take, for instance, the New Industrial Master Plan 2030 Strategic Co-Investment Fund. NIMP CoSIF is designed to support strategic sectors, including semiconductors and the electrical and electronics industry. Under its proposed two-to-one co-investment structure, close to 70% of the financing comes from the government, with the remaining 30% mobilised from private investors.

Such public-private collaboration via ECF and P2P financing platforms have the ability to not only catalyse but also crowd in private investment to benefit strategically important industries. More importantly, it reflects the vital role our capital market can play in the Malaysian semiconductor industry’s growth journey.

In this context, the SC wishes to reiterate its commitment to developing a capital market that is inclusive, innovative and responsive to the financing needs of domestic businesses.

This is an excerpt of the welcoming address by Securities Commission Malaysia chairman Datuk Mohammad Faiz Azmi at its inaugural semiconductor roadshow, “Powering SemiCons: Financing Your Next Breakthrough”, on Aug 19 in Penang

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