dato' dr mohd nazlee kamal : strong bio based startup and smes
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Strong Bio-based Startup and SMEs
Key to a Successful Bioeconomy
Mohd Nazlee Kamal, PhD. DIMP
World Islamic Economic Forum, Kuala Lumpur
4 November 2015
Global Trend: Changes in the Sources of Economic
Competitiveness
LabourIntensive
Capital Intensive
Knowledge-based
Information-based
From Industrial
Economy…
To
Knowledge Economy
INNOVATIVE
TECHNOLOGIES
CREATIVE
IDEAS/
SOLUTIONS
• Knowledge and innovation are the bedrock of development strategies to achieve higher
productivity and sustained economic growth
• The knowledge-based economy relies greatly on technologies, creative ideas and
solutions, and efficient allocation of resources as sources of competitiveness
Economic Paradigm Shift in a Knowledge Economy
Focused on Quantitative Growth
Quantity and Hardware-based approach
Conglomerates taking the lead
Focused on Inclusive and Sustainable Growth
Quality and Software-based approach
Strategic collaborations with, and increasing role of ventures and SMEs
Aligning Malaysia SMEs Development to the Bioeconomy
Vision
Economic activities based on processes using biological sources to
generate sustainable economic, social and environmental development
The Vision
Malaysia’s bioeconomy to be a
significant contributor to the nation’s
economy by 2020 and beyond
Bioeconomy has the potential to:
• Make the country more competitive
internationally
• Creation of value added jobs
• Enhance food security and affordable
healthcare
• Create greener economy as the country
shifts towards a low-carbon economy
• Increase Nation’s income by exploiting
our bio-resources to high value products
using bio-based technology
Startup and SMEs are the Backbone of the Malaysian
Economy
SMEs account for a
large proportion of
businesses in Malaysia
Majority are micro-enterprises, with 5 workers or less
2013 SME GDP Contribution by Key Economic Activity
(2005 constant prices)
Overall: 33.1%, Services 20.6%, Manufacturing 7.9%, Agriculture 3.2%, Construction 1.0%, Mining & Quarrying 0.1%
99.2% of business establishment
29.40% 29.60% 30.70% 31.20% 31.70% 32.00% 32.50% 32.70% 33.10%
70.60% 70.40% 69.30% 68.80% 68.30% 68.00% 67.50% 67.30% 66.90%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
2005 2006 2007 2008 2009 2010 2011 2012 2013
SME (% Share) Large Enterprise (% Share)
Comparison of SMEs and Large Enterprises and their
Percentage Share to GDP (constant 2005 prices)
2013 SME CONTRIBUTION TO
GDP 33.1%
EMPLOYMENT 57.5%
EXPORT 19%
Source: Department of Statistics, Malaysia and SME Corporation Malaysia
Important domestic source of growth
Foundation and support in supply chain through forward and backward linkages
Strengthen resilience of the nation economy
Provide support for growth in novel sectors
Promote private sector-led growth
Performance of SMEs Outpaced the Growth of the Overall
Economy
• Growth trend of SMEs in Malaysia
since 2004 continuously outpacing that
of the overall economic growth of the
country.
• The trend will continue and
enhancement of the SME ecosystem
will improve SMEs growth further.
Source: Department of Statistics, Malaysia and SME Corporation Malaysia
6.4
10
6.5
0.2
8.37.1
6 6.35.6
6.3
4.8
-1.5
7.4
5.2 5.64.7
-4
-2
0
2
4
6
8
10
12
2006 2007 2008 2009 2010 2011 2012 2013
SME Growth
Overall GDPGrowth
SME & GDP Growth Trend (CAGR based on constant 2005 prices)
79%
18%
2% 1%Percentage
Micro
Small
Medium
Large
Source: Department of Statistics, Malaysia and SME Corporation Malaysia
Profile and function/ role of SMEs
FDI & DDI
Increased Number of Employment
Spin-off & Supporting Industries
Revenue
Contribution to GDP
Green Lifestyle
Improved Quality & Wellbeing of Life
Reduced Dependency on Fossil Resources
Inclusivity & Community Development
Knowledge-based Economy
Ensuring Sustainability
Lessen Environmental Impact by using renewable
biomass resources
IMMEDIATE IMPACT ENABLING KEY STAKEHOLDERS
MEDIUM TERM IMPACT
LONG TERM IMPACT
VALUE PROPOSITION
INDICATORS
IMPACT
Technological Innovation
ECONOMIC PERSPECTIVE SOCIAL PERSPECTIVE ENVIRONMENTAL PERSPECTIVE
BIOECONOMY AS AN
IMPLEMENTATION STRATEGY
OF THE ECONOMIC
TRANSFORMATION
PROGRAMME
National Biotechnology Policy Bioeconomy Malaysia
Bioeconomy is the New Economic Icon for Malaysia
2011 - 2015
SCIENCE TO BUSINESS
Phase 2Phase 1 Phase 3
2005 - 2010
CAPACITY BUILDING
2016 - 2020
GLOBAL BUSINESS
A comprehensive roadmap that foster a
conducive ecosystem to accelerate the
growth of biotech industry
2020 - 2035
BIOECONOMY
ROADMAP
Shifting Traditional Economy to an Innovation-based
Economy
Innovations are
driving a growing
demand for
sustainable and
bio-based
products from
renewable bio-
based materials
The application of bio-based technologies is the GAME CHANGER that
transform conventional processes and industries in the bioeconomy into major
contributors to the national economy
Bioeconomy Development by Championing Bio-based
SMEs to Greater Heights
57
30
22
16
1
27
15 1612
1
24
6 74
2
0
10
20
30
40
50
60
Start Up SME-Micro SME-Small SME-Medium Matured
Number of BioNexus Companies; By Development Phase (Revenue Generation), &
By Industry (Q3, 2014)
AgBiotech BioMedical BioIndustrial
It is intended that by 2020, Malaysia will be a global player in Biotechnology and will generate at least 20 global Malaysian companies – National Biotechnology Policy
Provide regulatory
assistance &
consultation to
BioNexus companies
and the bio-based
industry in general
Spearhead programmes
and initiatives to enable
Bionexus status
companies to grow in
terms of market access
and other developmental
aspects to go global
53% of BioNexus status companies are SMEs
45% of BioNexus status companies are Startups
Access to finance
Access to human capital
and talent development
Access to advisory
services and information
Access to market
• Difficulty in obtaining financing
• Perceived higher risk for financiers (risky investment) in
biotechnology/ bio-based financing
• Limited marketing and promotion strategy
• Limited access of bio-based products to domestic and global markets
• Lack of certification of bio-based products/ Costly certification process
• Limited access to advisory and facilitational services
• Difficulty in retaining manpower
• Inadequate training and inadequate resources for training
Challenges Faced by Bio-based Startup and SMEs in Malaysia
Access to technology
and innovation
• Lack of management capacity and technology capability constraint
• Low adoption of technologies
• Limited capability in research and development
Access to legal and
regulatory services
• Management in intellectual property and regulatory issues
Startup and SMEs-Related Initiatives in the National Biotechnology
Policy and Bioeconomy Transformation Programme
• Promotion of new areas/ sector crucial to the bioeconomy
• The private sector (small businesses) to spearhead the development of high growth areas in bioeconomy
Focus on Niche Areas
• Provide timely access to funding, provide funding infrastructure to bioentrepreneurs
• Lowering barriers and cost towards commercialisationNurturing & Market Access
• Upgrading entrepreneurial skills through education and training BioentrepreneurshipDevelopment
• Promoting local bio-based products to international quality standards Global SME Development
• Promotion of equal and fair access to business opportunities Branding & Marketing Platform
• Creating environment conducive for innovation
• Providing greater support for innovative SMEs Clustering Strategy
COMPETITIVE STRATEGIES IMPACT ON VENTURES & SMEs
DISCOVER VALIDATEPRODUCT
DEVELOPMENT EFFICIENCY GROWTH MATURE
Playing the Role of the Ecosystem Architect to Support Bio-based
Startup
Entrepreneurs
Government
Universities
Investors
Service Providers
COMPONENT TO
STRENGTHEN
START-UP
ECOSYSTEM
STARTUP LIFE CYCLE
Mentors
• Discovery and
ideation
• Market
assessment
• Prototype
• Early customers
and iteration
• Product
development
and user
acquisition
• Monetisation
• User acquisition
and growth
• Product and
market
expansion
• Scale to global
markets
• Sustain profit
and growth
• Exit/ IPO
No funding required Self Fund:
MYR 0 – 50k
Angel:
MYR 50-150k
Seed:
MYR: 150 -500k VC:
MYR 500k – 5mil
> 5 mil
Roughly 2 – 5 months 3 – 12 months 3 – 7 months 6 – 9 months 12 – 24 months Steady state
Strengthening the Startup Ecosystem through Incubators
Strengthening the role of university
incubators
INVESTMENT
SERVICES
MENTORS
Incubators geared toward speeding up the growth and
success of start-ups and early stage companies by
• Providing mentorship
• Investor introduction and infrastructure support
• A good path to source capital from angel investors,
governments, and other financiers
Incubators provide entrepreneurs with a supportive
environment.
Provide services on a one-stop basis and enabling overhead
costs to be reduced by sharing facilities and services.
IDEAS APPLY TO
INCUBATOR STARTUP
Majority of start-ups
in Malaysia may
have good
technology but with
lack of proper
support and
facilitation, they
may not be able to
monetise it, and
that is always a
challenge to the
young
entrepreneurs.
Startup Focuses on Bio-based Chemicals and Wellness
Sectors
R&D
(New insights & understanding)
MANUFACTURING
Translation of insights into novel practical
application
PRODUCTS
Commercial and Social Application
UpstreamDownstream Value Add Market
Raw Material ProductProduct
To…From…
• Conventional
methods
• Low productivity
• Improved
productivity
and standards
Bio-based
Technologies
New business will be
generated from bio-based
innovations by means of
FOCUS AREAS
PROMOTION, a strong
domestic market and
potential for export,
spearheaded by startup
and SMEs
Diversification through bio-based products
Increased used of bio-based raw materials in the chemical industry
Enabling innovation and growth in the healthcare sector
Creating new bio-services businesses
BIO-COSMECEUTICALS, WELLNESS & PHARMA
NUTRITION
CELLULAR MEDICINE AND STEM CELLS
BIO-BASED CHEMICALS
Strengthening Entrepreneurship through Public Private
Partnerships
• Empowering Malaysian
bio-based start-ups
and SMEs to move up
the value chain
• Providing research
and infrastructure
support to industry
• Developing talent for
the bio-based industry
Establishment of
CoE for
Industry-Academia
Collaborations
Universities &
Research Institutes
Industry/
Biotechnology
Companies
Labs or offices
located in
universities with
extensive shared
facilities for industry
enhancement
Research &
Development
Commercialisation
Education
Participation of faculty members
and graduate students
Provision of educational
programs
Sharing research information
and technical expertise
Internship Opportunities
Licensing/ Intellectual
Properties
Sharing research information
and industry experience
outcome
Creating long-term partnership with
QB3 to accelerate commercialisation
of life science-based technologies and
innovations
• Capacity Building in Innovation and
Commercialisation
• Start-up Acceleration and Partnering
Programmes
• International Incubator Exchange
Programme
BiotechCorp-QB3 Bio-Entrepreneurship Programme
• To learn and adopt best practices from QB3
• Developing industry linkages for early stage
startups and to co-develop models that
could be translated to a focused program in
Malaysia
• Startup-in-a-box program, to create a
rapid pipeline for screening viable startups,
develop licensing models and funding
pathways
• Life science startup from a local university or
an innovative research group with potential
for growth will be trained in QB3
• An incubator exchange program will enable
local startup companies to have space within
the QB3 incubator network
1
2
3
The QB3 Ecosystem
QB3: a Three-Campus Research and
Commercialization Institute
PROGRAMMES THAT LOWER BARRIERS TO INNOVATION
QB3 Startup in
a Box
Legal
QB3 Garage
Operational
Venture Fund & Joint
Investing
Funding
QB3 Bridging the Gap
Proof-of-Concept
IndustryAlliances
Sponsored Research
QB3
(UCB, UCSC, UCSF)
California Institute for
Quantitative
Biosciences• QB3 link more than 220 laboratories
• Launched its first incubator, the QB3 Garage at the University of California SF in
2006, and a similar effort at Berkeley
• In the US, QB3 has produced over 300 bio-based companies within three years
through mentorship and seed funding
Linking the QB3 Ecosystem to Malaysia
University Industry
Service
providersStart-ups
Government
planners
QB3 Connects University Discovery
to Bioeconomy Growth
Teams
Start-up
in-a-Box
Incubator
Venture
Fund
MANUFACTURING
ECONOMICS
Startup
Company
Bioeconomy
Growth
University
Research
DISCOVERIES
Concept
Legal
Space
Funding
Linking the QB3 Ecosystem to Malaysia
Teams
Incubator
Start-Up in-a-Box
• Connecting research laboratories with complementary
technologies with industry
• Connecting scientists with bio-entrepreneurs
• Providing access to legal & financial services
• Assist in incorporating new companies and businesses
• Providing guide to small business grant applications
• Providing low cost, high quality space
• Providing access to infrastructure and equipment
• Providing a highly supportive work environment
Venture Fund • Invest for equity
• Have Corporate Investment Partners
Applying “Startup in a
Box” concept tp
BioNexus startup and
SMEs, the support
will come by in the
form of additional
benefits that will help
lessen overall
financial burden.
“QB3 Train the
Trainer Programme”
by BiotechCorp-QB3
partnership train
incubator managers
and technology
transfer personnel
from universities
Conduct programmes
between QB3 and
Malaysian
universities to local
develop incubators
Continuation Strategies to Successfully Proceed Startup and
SMEs
Comprehensive strategy to develop the
business potential of startup and SMEs
1. Intellectual properties (IP) that are
developed within CoEs and;
2. Graduates from the QB3 programme
with exceptional abilities and high
potential for global success are selected
to further enhance their business venture
with the Larta Institute
Leveraging on the LARTA Institute
network towards;
• Improving market access strategy into
other countries
• Obtaining guidance through a systematic
mentoring initiative from industry experts,
made available through the LARTA
Institute’s network and collaboration with
industry leaders around the globe
Companies and organisations, amongst
others that is part of the LARTA network
• Introduce prospects/pathways for commercialisation
• Best practices into their commercialisation efforts
• Develop strategies to support commercialisation approach
• Customer/Partner feedback – market interaction
• Build networks of influence and expertise
Creating 20 Global BioNexus Companies by 2020
A JOINT TASK FORCE BETWWEN
BIOTECHCORP AND SMECORP
• The BioNext programme was created to
further spur the growth of BioNexus SMEs,
especially those looking to widen their
market into other countries / regions.
• In pursuit of positioning local
biotechnology industry as global business,
the plan focus on consolidating the
strength and capabilities in technology
development and innovation with the
ultimate goal for commercialisation.
• Aim at BioNexus SMEs and through a
targeted approach in the areas of
financing, market access and human
capital development.
BIONEXT PROGRAMME TO
CATALYZE THE GROWTH OF
BIOBASED SMEs
IN COLLABORATION WITH:
CERTIFICATION & REGULATION
TECHNOLOGY ROADMAP
SUPPLY CHAINMANAGEMENT
BRANDING PARTNER SEARCH
MARKETING STRATEGY
A Conducive Funding Ecosystem for Nurturing BioNexus
Companies
Strategic Collaborations with Financial Partners
Making available
funding opportunities
for BioNexus companies
Funds to help the
SMEs businesses
expand and grow
further
Funds to launch
and to sustain
start-ups
Biotechnology
Commercialisation
Fund, established
to help revenue
generating
companies
Participation in Impactful International Trade
Exhibition and Special Missions
Connect with institutions with available
funds is advantageous to the development
of BioNexus companies
1
2
BioShoppe is an umbrella label for an array of made-in-Malaysia, value added bio-baseditems which include herbal supplements, personal care and household products.
A Branding and Marketing Platform for
Entrepreneurship Development and a Flagship Store
for Malaysian Bio-based Products
• Bioshoppe gives buyers a way of recognising
products manufactured by BioNexus companies.
• 3 retail presence, and showcasing over 100 types of
products (including beauty and aromatherapy) from
15 BioNexus companies.
• Accelerate the growth of BioNexus SMEs under the
Biocosmeceutical and Pharma Nutrition sub-sectors
BioNexus companies, notably SMEs, can leverage on
the key activities of the BioShoppe Concept Store:
• Collaboration with existing BioNexus companies
• Collaboration with Ministries, Agencies and State
Governments
• Online BioShoppe
• Participation in local and international events
• Advertising and promotion of BioShoppe
Addressing the Tail End of the Value Chain – the BioShoppe
Concept
Strategic Partners and Promotion Platforms
Products from BioNexus Companies
National Innovation
Conference and
Exhibition
Life Springs
Solaris
Nova Natural
Supplement and
Skincare
Expo Milano 2015
Super
Pharmacy
Megastore
Malaysia Global
Innovation and
Creativity Centre
ASEAN SME Showcase
Department of
Women
Development
Malaysia
Malaysia International
Halal Showcase
Market penetration strategy to enhance market access and build presence for
local biotech products, elevating the status of
BioNexus status companies
Clustering Strategy in Key Economic Corridors
BIOMEDICAL CLUSTERS
Northern Region Medical Devices Cluster
Central Region BioMedical Clusters
Southern Biopharma Cluster
Sabah: Drug Development & Drug Discovery Cluster
Sarawak Drug Development & Drug Discovery Cluster
BIOINDUSTRIAL CLUSTERS
Northern Region Biomaterials Cluster
East Coast RegionKertih Biopolymer Park
Oil and Lipid Cluster Biogas Cluster
Southern Region Johor BioXCell
Sabah POIC
Sarawak Corridor of Renewable Energy
AGBIOTECH CLUSTERS
1
2
3
4
5
6
7
8
9
10
Sabah High Impact Agriculture Centre - Kundasang
Agro BioXcell – Cameron Highlands
East Coast RegionCentre for Biotechnology & Herbal Products
Northern Region – Penang Science Park (Aquaculture)
Sarawak Agarwood Industry
14
15
13
12
11
1
2
3
4
5
6
7
8
9
10
14
15
13
12
11
Supporting Bioeconomy Key Stakeholders
Economic Corridors &
Industry Clusters
Institutions Of Higher Learning
BioNexus Status
Companies261
High-end Research Facilities
And Infrastructures
20 Public Universities
77+ Private Universities
16,000 annual graduates in applied and pure sciences
53 BioNexus partners facilities nationwide
134 BioNexus companies in AgBiotech
76 BioNexus companies in BioMedical
46 BioNexus companies in BioIndustrial
Northern Corridor Economic Region, East Coast
Economic Region, Iskandar Malaysia, Sarawak
Corridor of Renewable Energy, Sabah Development
Corridor Bio-XCell Malaysia, Kertih Biopolymer Park, Kulim-Hi-Tech Park,
POIC Lahad Datu & Sandakan, Tanjung Manis Halal Hub
Industry clusters in Malaysia currently provide a platform for supporting
Bioeconomy stakeholders in AgBiotech, BioMedical and BioIndustrial
CONCLUSION
In the context of bioeconomy, start-up and SMEs contribute to
economic dynamism, spurring innovation in novel sectors.
Bio-based start-up and SMEs development is a key focus in
the bioeconomy agenda – intended for as an important
domestic source for growth, and to promote a private sector-led
bio-based sector.
Realising the economic contributions as well as its potential for
further growth in the bioeconomy, the government has taken
proactive approaches towards developing an ecosystem to
support homegrown bio-based start-up and SMEs.
Thank You