BDO LLP | INTERNATIONAL TECH HUB
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THE ECOSYSTEM OF TECH BUSINESS Along with the big players, Malaysia also has a vibrant ecosystem of smaller, specialist startups and scale-ups. Local companies are predominantly small to medium enterprises, while the larger companies are mostly international companies One distinctive factor of SMEs in Malaysia is that almost all of them are family owned, often over generations, and they tend to be aligned in ethnic groups. Malaysia has three distinct ethnic groups. Along with the Malays, who are predominantly Muslim and account for about 70% of the population, there are the Chinese (c20%) and the Indian community (c10%). While the communities co-exist happily, it’s a fact of business life here that each community will support and enlist its own when it comes to funding, suppliers, investment and so on. It should also be added that the Indian and Chinese communities are the most dominant in business, while the native Malays tend to take up more of the public-sector and employment roles rather than become entrepreneurs. Chinese businesses tend to dominate the private sector – except in the technology space, where the majority of businesses are owned with a base in Malaysia. In global terms, Malaysians rank very highly in terms of their pay-to-productivity ratio, not least because you have a youthful, educated and very focused workforce here who almost all speak English. Most Malaysians, regardless of their ethic group, are at the very least bilingual, speaking their mother tongue but almost always also English, the lingua franca of the business community here. They learn English intensively from a very young age. and run by Indians. THE TALENT POOL
The talent here tends to be very well-trained and tech-savvy, which is one reason why many of them go abroad for some or all of their careers. There is a very strong affinity with Britain and British culture, and Malaysians will often go to the UK for education, training and work. Other countries that they frequently go to include the US, Australia and New Zealand. And when they do return, they bring fantastic skills and experience, ready to boost the local workforce. SUCCESS RATE Usually international businesses do very well here, especially if they are properly guided, take good advice, and go through a dedicated government body such as Invest KL or Invest Penang. These bodies provide a package of services to steer firms through the necessary process, including architectural and buildings advice. On top of that, however, many will also seek independent assistance with tax and audit. So long as they seek such advice and guidance and make use of the available support, the chances of success are very good for international businesses launching in Malaysia – as high as 80%.
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