Malaysia Digital Economy Corporation (MDEC) Vice President of Enterprise Development Gopi Ganesalingam recently gave an interview to Freda Liu of BFM Radio. The interview by the eloquent and insightful Freda turned out to be an engaging session with a professional who had his pulse on the exact beat of the local information, communications and technology (ICT) industry.
Firstly though, a bit about Gopi. An accomplished business strategist, and with a degree in Finance, Gopi has more than 28 years of experience in various diverse industries across the Asia Pacific region prior to MDEC.
He had held a number of key industry positions including Country Manager for Deutsche Telecoms Consulting, Commercial Head (Asia Pacific) for Telstra Australia Ltd, Senior Manager at Lucent Technologies Asia Pacific, and Financial Planning at American Express International, before Founding one of Malaysia’s first Cloud Computing consulting & SI companies, Lava Protocols, which went on to partner companies like Salesforce.com and Google in the ASEAN region.
Question: Perhaps you can give us a gist of what the GAIN programme is and what it hopes to accomplish.
Gopi: The Global Acceleration Innovation Network (GAIN) programme identifies and helps good companies scale up globally. MDEC realised in 2014 that we don’t have enough of these big global players, which are needed because they give birth to skillsets, talent development, innovation, higher revenues, and higher GDP.
I joined MDEC on 1 February 2015 primarily to head GAIN, as MDEC wanted an entrepreneur to run it. Right now, we have 150 of these companies that are using the GAIN platform, which sits on 4 pillars. These pillars are market access, mentorship, visibility, and access to finance matching for expansion – we don’t have the money, but we know where the money is.
Could you showcase a number of industries under the programme?
Gopi: The digital economy in Malaysia has got a diverse set of companies representing banking and finance, e-commerce, cybersecurity, drone technology, robotics, FinTech, and we try to champion some of these companies.
For example, we have a company called Aerodyne. 2 years ago, they were not even heard of; they joined the programme, and from 6-7 markets, they are now in 21 markets. They joined us in our market access initiatives and our leadership forums. They’re growing very big, very fast, and I’m told that they’re listed as the top 7th in the world.
Another company I’d like to highlight is N2N. It’s a stockbroking solutions provider that came with us on the first trip to Silicon Valley. It was doing about RM30 million a year, and the founder told me that after the trip, he needed to re-look his business model to go fully digital. Today, it’s acquired a couple of companies, he’s changed his model to be on a digital platform, and it’s one of the largest stockbroking solutions providers in Asia. Its revenue is 5 times more than 3 years ago.
What is GAIN’s Silicon Valley Immersion Programme all about?
Gopi: We’ve run this programme once a year for the past 3 years. We know that Silicon Valley works very well – it’s all run by entrepreneurs. It’s very difficult to replicate another Silicon Valley. But what is easy to replicate is the thinking behind it. We took about 65-70 of these entrepreneurs to Silicon Valley, where they learned how the ecosystem works, how the thinking works, how ‘pay forwards’ works, how talent and innovation is cultivated, how business models are made etc. and these are learnings that they’ve brought back into the Malaysian ecosystem. It helps us in the GAIN programme; when we have these mentors, they have gone to Silicon Valley, they have learned how mentorship is done effectively and efficiently for both parties, and today we have these mentors who are mentoring start-ups – some have invested in or acquired the start-ups – so I think the ecosystem is evolving further.
What benefits do these unpaid mentors receive for their mentoring?
Gopi: It’s a way of paying forward. The mentors help the start-ups not to make the same mistakes they did, give them insights, and open doors for them. But the mentors also learn through these new start-ups. Some of the mentors are from the ‘old school’. But then they start talking to the younger ones, they start looking at the digital platforms the younger ones are creating, they can use the knowledge they’re gaining (or even acquire these companies) to disrupt themselves.
How do you think visibility and storytelling has helped with the companies’ brand value?
Gopi: I think we currently lack both in Malaysia; it’s probably a cultural thing. In the 3 years that I’ve been working in GAIN, we’ve found so many companies that have got absolutely good products but are unheard of; hence, we bring them out. We have run programmes for storytelling and how important it is. How you tell a complete story in 30 seconds (elevator pitch). How you say it in 1 minute; in 5 minutes; in 30 minutes. This is very important for an entrepreneur, whether it is to market, to brand, to raise money; all this storytelling is essential.
When do you consider companies to no longer be ‘future tech champions’ but actual global tech icons?
Gopi: When we first started the programme, to be ASEAN tech champions was what we were trying to do… which we have a lot of today. We want to move them to the global stage, and we’re already beginning to do so via the 4 pillars. That’s one way of measurement.
The other way is just pure statistics. If I take these 150 companies, and I measure their final revenue in 2014, and then I look at 2017 – the average revenue CAGR for a tech company is 16%, while companies that are on GAIN programme are growing at 170% CAGR for 3 years. So that’s a big difference. We do the same for export revenue; the normal tech companies are growing at 27% CAGR, and the GAIN companies are growing at 47%. And I think this is going to grow much bigger as we do our market access initiatives into more countries.
How does the GAIN programme fit into what MDEC is doing overall?
Gopi: MDEC is the champion for the digital economy in Malaysia, which contributed to 18.2% of GDP in 2016. MDEC itself is guided by 4 pillars; driving tech FDI into the country, catalysing digital innovation ecosystems with 6-7 focus areas, propagating digital inclusivity through 2 national programmes (eRezeki and eUsahawan), and growing local tech champions. That last pillar is where GAIN is located.
The ‘local tech champion’ pillar is actually divided into two; one is GAIN, and the other one is TITAN, where we look at start-ups that are coming through, and whilst they are also guided by our 4 pillars, the stakeholders are a little different. So GAIN looks at scale-ups, while TITAN looks at start-ups.
From MDEC’s perspective, what were the key learnings from helping with these scale-up challenges?
Gopi: One of the key lessons is that not everyone wants to scale up. There are companies that are doing well, and they’re happy just doing what they’re doing. And so it’s best to leave them be; there’s nothing wrong with that. So the criteria that we use now is very different: You need to have a very good business model that’s scalable, hence you must actually be on a digital platform; you must be a visionary leader, you must have the passion and tenacity to go global; you must have the right team, the work culture is very important.
While rare, there are a couple of companies who have dropped off during the course of the programme. Either they have the wrong business model, or they don’t have the energy to want to go global fast enough.
What’s in store for 2019? Any changes?
Gopi: We’re going to continue in ASEAN; I think we’ve done quite well in the region, but I think it has to go beyond ASEAN, we need to look at market immersions and market access into the Middle East, Eastern Europe, India, China, and Australia. We need to look at innovation and funding capacity in Japan.