www.mavcap.com
Introduction to VC and MAVCAP
August 2013
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PART I: Brief Introduction to Venture Capital (VC)
i. The Funding Spectrum
ii. What is VC
iii. How VC Works
PART II: Brief Introduction to MAVCAP
i. History
ii. Strategic Role
iii. Investment Offering
iv. Investment Criteria
v. Investment Process
vi. Sample Portfolio Companies
AGENDA
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PART I
Brief Introduction to Venture Capital
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The Funding Spectrum
Angel Investors
Venture Capital & Private Equity
Government Grants
Debt/Project Financing
Seed Start-
up Early Stage
Expansion
Growth Pre-IPO Public
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What is VC
What is VC?
Private or institutional investment capital in relatively early-stage companies (ventures)
Focused more on technology-heavy
companies
Angel investors: • Typically wealthy
individuals • Tech industry
background • Small investment (<
$1M) • Very early-stage
companies • Demo, 2-3 employees • Motivation: Dramatic
return on investment via trade sale or IPO
Financial VCs: • Most common type of VC • An investment firm • Capital raised from
institutions and individuals
• Organized as formal VC funds with limits on size, lifetime and exits
• Fund compensation: carried interest
• Fund sizes: ~$25M to 10’s of billions
• Motivation: Maximize return on investment via trade sale, IPO and M&As
Strategic VCs: • Typically a division of
established corporations • Examples: Intel, Cisco,
Siemens, AT&T • Corporate funding for
strategic investment • Help companies whose
success may spur revenue growth of group
• Not exclusively concerned with return on investment
• Provide investees with valuable connections and partnerships
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How VC Works
Company and interested VCs find
each other
Company makes its’ pitch to multiple VCs:
•Business plan •Executive summary •Financial projections •Competitive analysis •Etc
Interested VCs engage in due diligence:
• Technological • Market • Competition • Business development • Legal and accounting
A lead investor is identified, rest are
follow-on
The following are negotiated: • Company valuation • Size of round • Lead investor share of
round • Terms of investment
Process repeats several times, builds on previous rounds
All VCs exit the Company via trade sale, IPO or M&A
route
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PART II
Brief Introduction to MAVCAP
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History
SNAPSHOT TALENT
Investment personnel 17
Years of combined investment experience
~100 YEARS
Source: Securities Commission, MAVCAP
SNAPSHOT INDUSTRY
REGISTERED VC * 56
ACTIVE VC 25
MAVCAP - RELATED VC 12
Background
• Incorporated in 2001
• Initial fund size RM500 mil
• Invested in >100 companies
• Direct Investment program
• Outsourced Partners program
• Asset under management ~RM970 mil
Objective
Spur the growth of the VC industry through
active participation in entrepreneurship in the
technology sector, and delivering commercially
viable investments.
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Strategic Role
Provide risk capital to companies in the field of technology and high-growth sector;
Drive the development of the local venture capital
industry
Direct Investment Program
Outsourcing Program
Early and late stage companies
with limited operating history.
Technology companies that are too risky for the capital market/bank loan.
Technology companies offering profitable opportunities.
Increase the number of venture
capital funds.
Provide opportunities for the existing fund managers to strengthen their investment track record.
Encourage private sector participation in the activities of venture capital fundraising.
Our Mandate Our Programs Our Targets
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Investment Offering
• MAVCAP invests directly via equity participation
• Via ordinary shares or convertible preference shares
• Start-up, early-stage and expansion stage
• Open to co-invest with other VCs and investors
• Period of three to eight years
• May hold Board position
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Investment Criteria (not exhaustive)
Scalable
Huge markets
High returns
Technology- driven
Generated traction
Attractive valuation
Malaysia- oriented/related
IP-protected Strong
management
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THANK YOU Malaysia Venture Capital Management Berhad
Level 10, Menara Bank Pembangunan
Jalan Sultan Ismail
50300 Kuala Lumpur
Tel:+603 2050 3000 Fax:+603 2698 3800
Email: [email protected]