Investor’s Guide to Startup Investing in Venture Capital in Malaysia

1. Investor’s Guide to Startup Investing in Venture Capital in Malaysia Venture capital funds are designed to manage the capital of investors who look for private equity chances in startup and established organisations with strong growth potential. These investments are usually described as high-risk/high-return opportunities. In the past, Venture Capital Investments in Malaysia were only accessible to professional venture capitalists, while now recognized investors have great ability to take part in this investment. Understanding Venture Capital Funds Venture capital is a type of equity funding that provides capitalist or other small companies the ability to increase financing. Venture capital investments in Labuan are private equity fund vehicles that look for investing in firms with high risk/high- return profiles, depending on the company’s size, assets and stage of product development.

2. Unlike mutual funds and hedge funds, venture capital finance focuses on a very specific type of early-stage investment. All companies that receive Venture Capital Investments have high-growth potential and a long investment horizon. These types of funds have portfolio returns that look like a barbell approach to invest. Many of these finances make small bets on various young startups, believing that at least one will get high growth and reward the fund with a relatively large payout at the end. This allows finance to reduce the risk that some investments will fold. Investing In Large VC Funds Comes With Advantages •Experienced virtual capitals with inside knowledge manage your investments •Most large funds include various base of companies •The fund maximizes the investor’s equity stake in already proven, successful companies

3. Why Should Your Startup Increase VC Money? Venture capital is an ideal funding structure for startups that need money to scale and will likely spend a significant amount of time in the red to build their business into an extraordinarily profitable company. Unlike car dealerships and airlines – companies with valuable physical assets and more predictable cash flows – startups usually have litter collateral to offer against a traditional loan. This is why, if an investor issued a loan to a startup, there is no way to guarantee that the investors could earn the amount they have lent out if the startup were to fail. By increasing venture capital, startups can raise money that they are under no obligation to repay. While traditional loans have fixed interest rates, startups equity investors are purchasing a percentage of the company from the founders. This means the founders are giving investors rights to a percentage of the company profits in infinity, which could amount to a lot of money if they are successful. The Bottom Line! Each fundraising round is usually correlated with a new stage in a startup’s development. It is often attached to an evaluation event. Hopefully, you have now understood everything about venture capital investments in Malaysia. If you want to know more about Venture Capital Investments in Labuan, contact us at +60 3 9212 6940 or consultant@qx-trust.com today.