- Building vibrant, sustainable startup ecosystem requires effort from all stakeholders
- Capacity building has allowed startups to pivot and remain resilient at a tough time
2020 was, by all accounts, a terrible, horrible, no good, very bad year. But it was also a year of revelations – of change, opportunity, and lessons.
For the Malaysian Global Innovation & Creativity Centre (MaGIC), 2020 highlighted the importance of innovation and technology in surviving a global pandemic. “Innovation and technology has never been more important and prominently used, to say the least,” MaGIC CEO Dzuleira Abu Bakar tells Digital News Asia, as part of a recap of 2020.
“The last year accelerated technology adoption and changed our worldview of things in ways we could not have ever imagined. All only possible through the power of technology and innovation.”
2020 was also a year of revelations for Dzuleira, who personally learned how to navigate expectations when it comes to life, work and family – how to manage education, social interactions and keeping mental and physical health in check during such a highly disruptive period.
“To me, the year has imparted a crucial lesson on the need to be on the lookout for each other,” she says.
It’s a lesson that was extended to MaGIC and the Malaysian tech startup ecosystem as a whole.
Covid-19 has had a severe impact on startups worldwide. According to the Global Startup Ecosystem report, 72% of startups in the world have seen their sales fall since the beginning of the pandemic, with the drop averaging at 32%. On top of that, a 40% decline in sales or more was faced by 40% of all startups, while only 12% recorded substantial growth.
In Malaysia, this was softened somewhat thanks to a bit of foresight by MaGIC, who – at the start of the movement control order (MCO) – conducted a survey which found that a shocking 2.9% of startups were confident they could survive beyond 12 months under prevailing lockdown conditions.
Three weeks into the MCO, MaGIC ran another survey, which found that 64% of startups experienced a decline in revenue. On top of that, 21% said they needed between RM251,000 to RM500,000 (US$62,500 to US$124,500) to sustain their business until the end of 2020, while 16% indicated that they needed more than RM500,000.
“The findings of both surveys played a big part in the fruition of the design of the tech startup funding,” Dzuleira says. Sure enough, during 2020’s Global Acceleration Program (GAP) organised by MaGIC in mid-Sept, access to funding and startup resilience became a key theme.
Doing this together
For the most part, startups are more resilient than they appear. Dzuleira points out that they are agile by design, and most have been responsive in addressing the needs, challenges and opportunities during the pandemic.
Yet not all startups are able to make the necessary leap. “We are also aware that not all businesses can pivot. Some may need to rip apart their business model and implement a new one. We believe startups need to continue to build capacity in order to increase resilience,” Dzuleira says.
“Therefore, MaGIC has shifted its programmes to help startups diversify their business models or product market. Our programmes are tailored to build high economic and social impact. In these challenging times, it is imperative that we have a vibrant and sustainable ecosystem for startups to ensure they soldier on and thrive.”
It’s not something MaGIC could do alone. “Building a vibrant and sustainable startup ecosystem at a national, regional and global scale requires a concerted effort from all stakeholders – from entrepreneurs and corporates, to regulators and consumers – as we attempt to innovatively develop solutions for challenges that come our way. Together, we can propel a resilient global economy,” Dzuleira elaborates.
For Dzuleira, social innovation taps into the power of collaboration and partnership – the bringing-together of public, private and the community themselves to devise innovative solutions for the country.
“We should not work out solutions in silo, but have that open platform and conversation to bring the right people onboard and devise more effective solutions.
“This may include ideas, ways and means, strategies and even organizations that develop innovative solutions to meet, especially the needs of those who live at the bottom of the pyramid – improving their access and outcomes in areas such as education, healthcare, community development, livelihood and more.”
Into the new normal
These solutions will be pivotal in allowing the country to navigate the coming times. “Normal has been redefined, it would be unlikely that things return to where they were pre pandemic. It’s the New Normal that we have to live in, which minus the healthcare crisis and tragedy can be a norm enabled by technology.”
To thrive in this new normal, she adds, we would have to embrace change – something which can be done with technology.
“We need to embrace change to ensure business growth and sustainability. There are lessons to be learnt from the global health crisis, and it is important to learn, adapt and pivot,” she stresses.
“In MaGIC, this could be done through the restructuring of our existing programmes such as GAP and MaGIC Online Academy, whilst introducing new ones such as MyStartup Hub and Global Market Fit Programme to better suit the needs for startup to be ever adaptive to other scenarios the future offers.”
Where do we go from here? For Dzuleira, it’s about learning the right lessons. The revenue drop over the early months of the MCO is an indicator that being agile and capable of pivoting is crucial to survive – something Dzuleira says is a lesson startups need to take to heart.
“Of course, some business models are tough to pivot and a better solution may be to tear it apart and draw up a new plan. Yes, tough times call for extraordinary measures. But startups are agile by nature and are able to shift faster compared to large conglomerates,” she says.
This, she adds, can partially be attributed to their commitment towards capacity building, which helps build resilience in times of crisis. “These startups have enhanced their skills, knowledge and equipment. They are ready to scale up or mitigate disruptions.”
“MaGIC has always been a believer of capacity building and supports the ecosystem through various accelerator programmes and bootcamps, making available our best-of-breed mentors and most sought-after coaches in various specialties to assist startups reaching out for assistance.”
Again, MaGIC didn’t do this alone. Government interventions also helped. MaGIC’s survey found that almost 74% of startups claimed that they have benefited from various government incentives.
2021 may not dawn at a new light. Much of the future remains cloudy. But Dzuleira has a more positive outlook. “We may be facing an economic contraction, but the truth is, matters could be much worse,” she quips.
“Malaysia’s resilient economy has managed to stand firm, no doubt thanks to the strong foundations in place as well as the timely and strategic government interventions to prevent us from going into free fall.”
If anything, 2021 does have its silver lining. The Malaysian Central Bank, for one, forecast a GDP growth of between 5.5% and 8%, something Dzuleirsa says is “indeed music to our ears.”
What’s important now is staying the course and adapting, as well as put trust in innovation and technology. “By enabling technology, we are able to re-engineer the way we operate and transform our futures,” Dzuleira concludes.
Karamjit Singh contributed to this article.
Thank you for stopping to visit My Local Pages. We Hope you enjoyed checking this story about current Asian news called “MaGIC CEO: 2020 highlights importance of innovation, technology, collaboration & capacity building”. This article is presented by My Local Pages Australia as part of our World news services.
#MaGIC #CEO #highlights #importance #innovation #technology #collaboration #capacity #building