Everyone has a plan until ...
The Aaron Sarma Newsletter | Issue #3
So I had a plan last week.
After the announcement of the Malaysia’s Budget 2023 last Friday I thought I’d share some thoughts on the various policies that were proposed that affect the innovation and entrepreneurship ecosystem. Alas, I started hearing rumours that the Prime Minister would dissolve Parliament soon and true enough on Monday the inevitable happened.
“Everyone has a plan until they get punched in the mouth” - Mike Tyson
It also feels like the zeitgeist of this year. We started 2022 thinking that finally we are out of the pandemic, the market was opening up and life was going back to normal. But what seems to have happened is that someone decided to start a conflict in the east of Europe, the US Federal Reserve started increasing interest rates to slow down inflation causing a ripple effect around the world and the markets have gone into a tailspin. We are now faced with concerns of a deep recession. Businesses of all types are bracing for the worst. We’re reading of lay offs and many people are out of work.
We got punched in the mouth.
And yet, I’m really bullish about what this could mean if you’re an entrepreneur or early stage investor. There are many issues in the economy and in society coming up front and centre. This creates an environment ripe for innovators with ideas to thrive. There’s also a lot of dry powder out there to invest in startups. VCs are may be taking their time to close deals now but trust me, all of them are looking for the next big success story. Founders also will be able to tap in to a lot of talent who are now looking for opportunities to build something meaningful.
Entrepreneurs can and should punch back.
Let’s not forget how the aftermath of the Global Financial Crisis of 2008 was birthplace of AirBnB, Slack, WhatsApp, Square, Uber, Instagram and more. I truly believe that some of the best companies will be built in the next 18 months.
The greater the crisis, the larger the opportunity.
So what do you think? Does the current economic climate create opportunities for startups to build businesses in the digital economy?
What I’ve Been Up To
Budget 2023 … for what its worth
The week of the budget proved unexpectedly busy. I knew I wanted to share my views of what was to be announced. If anything to voice thoughts from the industry with the powers that be - which, by the way, your feedback has proven to be extremely valuable for. More importantly I do think it’s important that we continuously speak up so that we can contribute to change.
Here’s a quick roundup of where you can get a sense of the conversation:
OP-Ed: Double Down On Digital Development on Digital News Asia
Quote Contribution: Tax Exemptions, Dedicated Programmes And Incentives For VCs Makes Its Way Into Budget 2023 Wishlist on Disruptr
Pre-Budget Interview: Can Budget 2023 Help The Youth Entrepreneurs And The Arts on BFM
Pre-Budget Interview: Building A Brighter Startup Ecosystem on Astro Awani
Post-Budget Interview: Double Down On Digital Development on Astro Awani
A mini review
While the Budget 2023 has not been adopted pending the upcoming election there are some things that is very intriguing and encouraging for the Digital Economy. I like how there’s still meaningful focus on helping to fund startups through MyCIF, Cradle Fund, Dana Impak and and the R&D allocation for Mranti. There’s also much focus on SME digitisation and on 5G deployment for the man on the street. These are all good things and I hope that most of this will be adopted when the new government comes into power. They will however, have to ensure some fiscal responsibility. Will definitely check in on this topic when that happens.
Hard Talk
In my post-budget conversation with Ibrahim Sani on Notepad, we tackle some macro issues beyond the specifics of the budget itself.
At the PE-VC conference that I attended with my ScaleUp Malaysia partners, Xelia Tong & Andre Sequerah earlier this month the most concerning thing wasn’t anything negative someone said about Malaysian startups or our market - instead it was that Malaysia wasn’t even mentioned in the conversation. Malaysia is viewed by many regional investors as “fly over” country. It was quite a wakeup call for us as investors who are working primarily on building the Malaysian ecosystem.
Its a great 30 minute conversation where we discuss Malaysia’s place in the regional startup ecosystem. As usual I try to be raw and honest about my concerns.
Selangor Fashion Accelerator
In a bit of a change in pace from the usual events I attend, I participated as a judge at the Fashion Accelerator finals organised by Selangor Information Technology And Digital Economy Corporation (SIDEC) on the 8th of October 2022.
It was really nice to see entrepreneurs of a different stripe pitch and showcase their business. I loved some of the fashion collections. I hope my questions and comments helped the entrepreneurs and I look forward to seeing them go on to be very successful.
Tatler Gen T List Launch Party
Tatler’s Gen T lists the top movers and shakers in the region under 40 years old. I’ve had the pleasure of being a part of the Gen T Tribe over the last two years. As a Tribe member part of my role is to identify the best up and coming talent in who have made an impact over the last year. The Tatler team takes it from there and the finalists are unveiled at the launch party. This year’s event was at Suzy Wong on the 12th of October.
I’m happy to see ScaleUp Malaysia alumni Diyan Ho from Hauz and Alex Tan from Iimmpact make the list this year. I’m also really glad see Benny Farouk from SheFights Gym make the list too. We met at a taping for a show on RTM that will air later this year.
The Week To Come
How to Scale Beyond Malaysia
Here’s a few things I will be up to from the time I hit “publish” on this email:
Coaching Week at ScaleUp Malaysia | We look forward to meeting our portfolio companies every month. This week will be filled with 1-1 sessions with various teams in our portfolio.
BFM Breakaway | BFM's annual event is back with a theme of "How to scale beyond Malaysia." I’ll be on a panel discussing "Leveraging Experts & Insiders with Adlin Yusman from Endeavour Malaysia, Simone Lee, Founder & CEO of Tigas Alliance Group; moderated by Richard Bradbury.