27-4-2024 (KUALA LUMPUR) In a bold move to propel Malaysia’s semiconductor industry, a new venture capital firm, Blue Chip Venture Capital, is poised to invest in more than 10 startups through its $209 million fund. Co-founder and Chairman Lai Pin Yong believes Malaysia is well-positioned to advance its chip sector as the Southeast Asian electronics manufacturing hub attracts businesses and the global supply chain diversifies.
“It is important now to capture this tsunami and it should stop in Malaysia, not elsewhere. We should not miss the opportunity,” Lai said.
Established last year, Blue Chip Venture Capital aims to raise 1 billion ringgit ($209 million) from institutional investors, with Lai noting the response has been “encouraging.” The fund plans to invest in “at least 10 companies,” focusing on integrated circuit design and advanced packaging, particularly local Malaysian players, as young companies emerge in the country’s chip sector.
Despite Malaysia’s nascent venture ecosystem, with startups raising only $110 million last year, a mere 1% of Southeast Asia’s total, Lai emphasizes the need for more venture capital to develop the country’s chip industry, currently concentrated on back-end processes like assembly and testing.
“We have about $200 million for now. It is a small fund. But in order to transform the whole industry, we need more VCs, more big guys to participate. For me, Blue Chip VC can kick off the initiative as a start so that many people will join,” Lai stated.
A positive development for Malaysia’s chip industry was a major startup forum held this month in Kuala Lumpur, where 12 international investment firms, including Nordstar, GP Bullhound, and K3 Ventures, announced plans to establish offices in Malaysia to support the country’s venture capital ecosystem.
Blue Chip was co-founded by Lai, a former Intel executive, and Chief Executive Tim Chen, whose career spans over four decades, including stints at AT&T Labs and Motorola, as well as serving as CEO of Microsoft in China. The venture fund’s senior advisers include Andrew Sheng, a Hong Kong-based Malaysian banker and former chairman of the Hong Kong Securities and Futures Commission.
Lai envisions Malaysia and neighboring Singapore working together to attract investment and talent, especially as the rise of artificial intelligence drives demand for advanced chips.
“Singapore can attract the best AI talents,” Lai said, suggesting that companies base “20% of [their] engineers in Singapore and 80% in Malaysia” to leverage the advantages of both countries, such as Singapore’s access to funds and Malaysia’s abundant land.
