About Cradle

Cradle Fund Sdn Bhd (Cradle), an agency under the Ministry of Finance, Malaysia is the organisation that manages the Cradle Investment Programme. The Ministry of Finance had allocated RM100 million to Cradle for this programme since it began in 2003. The agency was awarded an additional allocation of RM175 million for the 2011-2015 period, under the 10th Malaysia Plan.

What is the Cradle Investment Programme? The Cradle Investment Programme (CIP) is Malaysia’s first development and technology commercialisation funding programme that enables Malaysia’s budding innovators and aspiring entrepreneurs to transform their raw technology-based ideas in the ICT, non-ICT and high growth technology industries into commercially viable ventures or local start-up companies to attain commercialisation. Cradle offers two types of conditional grants – pre-seed (CIP Catalyst & U-CIP Catalyst) and seed (CIP 500). The pre-seed grants offer funding of up to RM150,000 to teams of individuals to develop their innovative technology ideas into prototypes or proof-of- concepts; whilst the seed grant offers funding of up to RM500,000 to help Malaysian start-up companies with innovative technology products/services to attain commercialisation.

Who have benefited from the CIP?Since its inception, Cradle has benefited over 700 Malaysian tech start-ups and the number is increasing. A few Cradle entrepreneurs have grown to raise further amounts of funding among them taxi-booking app, MyTeksi (Grabtaxi), finance-comparison website, iMoney, bus ticket selling app, CatchThatBus and many more.

Cradle also holds the highest commercialisation rate among government grants in the country – 58%.

How many have applied for Cradle Grants?Currently, over 700 individuals have applied for the CIP Catalyst product development fund and over 300 start-up companies for the CIP500 commercialisation fund. A team of professional analysts will study the applications received and select innovative and highly potential ideas to be shortlisted for the fund.

What happens if a selected idea is not commercialised?There are several reasons for an idea to not take flight. It could be an issue with the team or the market is not ready for it or that the timing was not right. If this happens, we would advise that the team re-evaluate the business model to meet the demands of the current market.

Does Cradle run any other programmes besides the CIP?Besides the CIP, Cradle also runs the Coach & Grow Programme. The Coach and Grow Programme is a market-driven programme intended to bring together key players in the entrepreneurial ecosystem to train existing entrepreneurs to grow their businesses to greater heights, via coaching, networking and showcase events.

Cradle is also one of the main drivers of the Malaysian angel investor community. It help set up the Malaysian Business Angel Network (MBAN) in 2012 to grow more accredited angel investors through education & training. Equally important, MBAN will also monitor angel investment statistics in Malaysia. MBAN aims to be an agent of growth for Malaysia’s startup scene, putting Malaysia on the map as the go-to market for innovation, growth & entrepreneurship. For more information about MBAN, go to www.mban.com.my.

It also administers the Angel Tax Incentive, which was designed for angel investors to be accorded a tax deduction of up to RM500,000 in the third year (after 2 years) of his or her shareholding in the newly invested companies. Its objective is to stimulate and encourage angel investments from the private sector into technology based start-up companies in Malaysia. This will provide a funding avenue that would allow them to grow.

Why has Cradle decided to co-invest with other investors in the region?The co-investment partnership is done in preparation for the gradual reduction of government grants towards supporting early stage start-ups. By 2017, 70% of Cradle’s funding allocation will be channelled into co-investing initiatives and only 30% will be retained for direct grants. It aims to forge co-investment partnerships with 21 local and global investors.

Co-investing will also provide Malaysian technopreneurs the stronger support they need to take their ventures to global markets without having to leave Malaysia in search for investors.

The initiative gives them the opportunity to use Malaysia as their home-base to work on their ideas thus, being that step to stem the entrepreneurial brain-drain.

Discover more about Cradle at www.cradle.com.my