KUALA LUMPUR: Total alternative fundraising avenues grew by 27.8 per cent from 2022, to RM3.8 billion.
Since 2019, total alternative fundraising has grown by 36.5 per annum, driven by equity crowdfunding (ECF)/peer-to-peer financing (P2P financing) fundraising (62.5 per cent per annum) and venture capital (VC)/private equity (PE) fundraising (21.4 per cent per annum).
Funds raised via ECF and P2P financing stood at RM2.2 billion in 2023.
While overall investor participation in terms of volume was slightly lower in 2023 compared to 2022, the SC saw increasing participation of institutional investors in ECF and P2P financing markets.
Notably, despite being a smaller segment, institutions have invested nearly RM1.3 billion into ECF and P2P financing campaigns, comprising 57 per cent of total funds raised in 2023.
Funds raised via VC/PE increased by 23 per cent to RM1.6 billion in 2023 from RM1.3 billion in 2022.
Total committed funds for the private equity and venture capital as at the end of 2023 stood at RM11.00 billion and RM6.58 billion respectively, with a combined total of RM17.58 billion.
The Securities Commission Malaysia Annual Report 2023 said for private equity, commitments are sourced largely from corporate investors (32.36 per cent), individuals and family offices (19.45 per cent), and financial institutions (12.88 per cent).
For venture capital, government agencies and investment companies (38.62 per cent), sovereign wealth funds (22.55 per cent) and corporate investors (19.73 per cent) make up the top three sources of funding.
The top three registered corporations by amount of investor commitments as at end 2023 were Creador Sdn Bhd, Xeraya Capital Sdn Bhd and Malaysia Venture Capital Management Bhd (MAVCAP).
The report also noted that venture capital investments in 2023 concentrated on growth (56.63 per cent), followed by early stage (26.25 per cent) and seed (7.73 per cent) opportunities.
Private equity investments were primarily channeled into growth plays (77.20 per cent), with some investments made to early-stage opportunities (16.71 per cent), followed by buyouts (3.14 per cent).