Kuala Lumpur, May 4 – Axiata Digital Innovation Fund (ADIF), Malaysia’s largest corporate venture capital fund, has welcomed state investment arm, Johor Corporation (JCorp), as its new investor to further drive Malaysia’s digital industry.
ADIF, a collaboration between Axiata Group Berhad (Axiata) and Malaysia Venture Capital Management Berhad (MAVCAP), was established in support of the Government’s objective of building a comprehensive digital ecosystem to support the growing digital economy. The fund is further directed to help build up the capabilities of local digital companies, especially Bumiputeras, to become successful regional and international players.
At a signing ceremony yesterday, JCorp announced a RM10 million investment in ADIF, adding to RM50 million and RM20 million committed by Axiata and MAVCAP respectively, with the remaining to be raised from other principal investors to achieve the RM100 million target fund size.
Founded in late 2014, ADIF’s purpose is to aid digital startups that are already revenue-generating operations requiring further support to grow in terms of funding, know-how and market access. Additionally, through Axiata’s extensive market reach of approximately 320 million across Asia together with in-depth knowledge of the region, ADIF provides Malaysian digital entrepreneurs with unprecedented access to regional customers and partnership opportunities.
To date, with over RM30 million committed, ADIF has under its belt a total of 13 investee companies in various sectors including travel, business services, food and beverage, education, telematics, logistics and consumer lifestyle. A total of 46% of the investee companies are Bumiputera companies and ADIF targets 70% of its fund to be channelled towards these digital startups. At end 2016, Collectively, ADIF’s portfolio companies have grown 240% over the last two years, generating almost RM60 million in revenue and supporting 918 direct jobs.
Tan Sri Jamaludin Ibrahim, Group Chief Executive Officer of the Axiata Group, said, “We are pleased to welcome JCorp as our partner in ADIF. Their commitment is symbolic of their support and belief in the objectives of the Fund.
“Geared towards becoming a New Generation Digital Champion, Axiata is in an excellent position to collaborate with innovative and high-potential digital companies to help them become profitable and sustainable. Further, in line with our purpose of “Advancing Asia”, we started this fund as part of our corporate responsibility. By 2020, Axiata hopes to nurture and fund a substantial number of Bumiputera and Malaysian digital services businesses with an end goal of building four to five regional champions. Going by the early successes of ADIF, Axiata has now replicated the fund model in Cambodia through our operating company, Smart Axiata.”
Datuk Kamaruzzaman, President & Chief Executive of JCorp, commented, “In this age of business disruptions, corporations must be able to see around corners. JCorp will extend this capability with our participation in ADIF. Concurrently, this creates a conducive environment for JCorp. As a conglomerate with an interest in key sectors of the Malaysian economy, including healthcare, food and beverage, property and plantation, we will have the opportunity to integrate some of the solutions provided by ADIF’s startups into relevant aspects of the business, as a quick win which is mutually beneficial.”