KUALA LUMPUR: Venture capital firm RHL Ventures Sdn Bhd is on track to close its Hibiscus Fund at RM300 million ($71.4 million) by the middle of this year.
RHL Ventures co-founder and managing partner Raja Hamzah said the company's focus is to fully commit to deploying the Hibiscus fund this year and enabling its start-ups to grow.
Raja said the fund's main objective is to accelerate Malaysian economic recovery by digitalising Malaysian businesses through innovation from various stage companies and start-ups.
"This is particularly in the Series A and Series B stages. We have raised approximately $65 million and plan to close our Hibiscus Fund by the middle of this year, within the range we have set," he told the News Straits Times in an interview.
Managed by RHL Venture and South Korea's KB Investment, the Hibiscus Fund is a venture capital fund that forms part of the Malaysian government's Dana Penjana Nasional (DPN) Programme.
A part of the fund is contributed by private investors, and the balance through a ringgit-for-ringgit match by the government.
Raja said that apart from the Malaysian government, RHL Venture is currently in talks with various sovereign wealth funds and foreign funds to launch other funds (not just in Malaysia) on its plan to launch new funds.
"The new fund will most likely be established in 2023, which we will only announce when the time is right.
"But now, we are fully focused on deploying our current funds," he said.
Meanwhile, RHL Venture, according to Raja, feels that demand for venture capital funding in Southeast Asia remains high, fueled by institutional investors.
Even in Malaysia, he said institutional investors are increasingly interested in the venture capital space to increase alpha.
"Our portfolios have also seen strong growth, with Signature Markets increasing sales six times during the pandemic.
"The growth of our existing portfolio and our new funds is why we are confident of tripling our assets to RM1 billion (US$239 million) over the next five years," he said.
Raja said RHL Venture's vision is to contribute to the Southeast Asia start-up ecosystem, especially in Malaysia, where it wishes to build a more robust private market business.
To build a sustainable and robust start-up ecosystem here, Raja said the company would encourage local start-ups to leverage and enlarge Malaysia's uniqueness and continue to tap into less developed digital economy sectors, including Islamic commerce and AgriTech.
"We are mainly focused on building and supporting innovative private tech companies as we move forward, specifically healthtech, edutech, fintech, and consumer-related companies that prioritise innovation and growth while disrupting existing business models.
"Technology allows businesses to grow exponentially and create a synergistic ecosystem in which everyone benefits from the value they create," he added.