SMEs Urged To Raise Funds From Private Investments Instead
Instead of relying on government loans, Datuk Seri Dr Wee Ka Siong, Minister in the Prime Minister’s Department, has urged small and medium enterprises (SMEs) to opt for private investments to raise funds.
More private investors are showing interest in leading and stimulating the growth of promising SMEs, said Dr Wee.
SMEs are advised to attract these investors with innovative business plans, and they must better themselves to be the best salesperson of their product, service and company, in order to draw the attention of the venture capital firms and angel funders.
“Loans are not the best solution to your needs as a business entity,” he said.
To assist SMEs in raising funds via private investors, the Secretariat for the Advancement of Malaysian Entrepreneurs (SAME) acts as a one-stop centre to assist SMEs, with a strong network of partners that are willing to provide alternative funding in the form of venture capital, angel funding and equity crowdfunding.
Since 2015, SAME has assisted 16 SMEs in securing a total of RM153.8 million in alternative funding instead of loans. So far, SAME has helped more than 10,000 companies through its programmes nationwide.
RM54.3 million had been disbursed to 271 Chinese SMEs since 2015 via KOJADI, an investment arm of MCA. Recipients include businesses from the general commerce sector, business services and professionals, building and construction, food and beverage and printing and publishing.
KOJADI was first granted RM50 million in 2015. As Prime Minister Datuk Seri Najib Tun Razak was pleased with the record of zero non-performing loans, he added another RM50 million into the KOJADI funds in 2016.
“As long as we are in the Government, we will ensure that this fund continues to perform well. Hopefully, we can add on to the current RM100 million so more SMEs can benefit from it,” said Dr Wee.
He also urged SMEs to engage in merger and acquisition (M&A) deals to become stronger and competitive in the market.
He said in 2015, there were 331 M&A deals worth RM36 billion, marking 55% more than the previous year of 214 deals.