Although there are no promises from MDeC, but at least initiatives are taken into the consideration that certain funds will be proposed to be maintain and new funds will be available. The following funds that MDeC proposed to be maintained include MSC Malaysia Research and Development Grant Scheme (MGS), Pre-seed Funding and MAC3 Co-Production Fund. Lets have some fate and patient with MDeC, and hope that the government continues to drive the country growth into a better economic environment for new entrepreneurs.

Reference Link: http://biz.thestar.com.my/news/story.asp?file=/2010/5/8/business/6208729&sec=business

Dear ICON Grant Applicants,

Congratulations.

We are pleased to inform you that your application for the ICON grant has been approved.  The secretariat will be contacting you soon for the arrangement of your letter of offer.

Thank you.

Regards,

Secretariat

Upon receiving this email, the excitements is ……zero. We have waited for too long and some of our previous plans has been overturned due to the delay of ICON Grant. However, as we expected, with full preparation of our effort from going door to door to get Letter of Interest from various parties, and with the past previous experiences in presentations and answering question, although we are still nervous, but experiences really made us when through the following presentation.  On top of that, I have learnt something from my partner which I am still very lack off in QnA. So, here is some advice with some tricky questions that my partner has answered well. Thanks to him that we have gotten through this stage.

• What is your expected revenue/profit?

Tricky Part: This is the most tricky question ever. Imagine if you have told them that your expected revenue/profit will be RM1 million. Wow, such a good business to do. If your idea could generate RM1mil, everyone will have started and there is no point for you to receive this grant. This question lures you into telling an unknown figure that you yourself are so unsure. Whether the numbers you have mentioned is reasonable or unreasonable it will definitely lead you to another question that will taunt you down. “So on what basis that your idea will help you generate RM1mil? how sure are you with your analysis?”

Answer: The best answer will be telling them that you are aiming to breakeven for the first year. In any start-ups, if you are able to breakeven the first year is considerably good and reasonable. Don’t try to talk BIG here, the panels are not stupid.

• What stage are you in now?

Tricky Part: This question is to see how SERIOUS are you with your own business. 

Answer: Even you have nothing started, just bullshit them that you had something started, whatever you have done to your make your idea come true. Of course, if you have really put in your effort, tell them! Grants are only given to people with real effort put in. (In matter affect, we have done IP and Trademark for our proposed idea, we have gotten letter of interest, we have our initial work done, now is left out with the money to push the product out)

• Since your clients has shown interest with your product, why do you still need the grant?

Tricky Part: Are you trying to con our money here? The panels will try to give all kinds of reason that you do not need the grant.

Answer: Yes. Indeed that our potential clients has shown interest with our ideas, however, there isn’t a tangible product to urged them to issue us a PO (Purchase Order) yet, and that’s why we only had a LOI (Letter of Interest) instead.

So, Start-ups, in such tough times what will you do to prevent from extinction?

1. Pre-Sales works for all sectors – You need not have a perfect end product to sell. Take a home delivery service offering gourmet meals as an example. A bootstrapper will not waste a cent on making meals that nobody wants, instead, he/she will first compile an interesting menu, then goes into the market to get their interest and get orders first with just only the well presented menu. Another word, sell your ideas in the air, get the money, and developed. the upside for pre-sales is where you get a confirmed sales, and you need not waste a single cent on something nobody wants. the downside is, you need extra effort to convince your clients with just an idea or an unfinished product.
2. Cutting Down Cost the creative way – There is always another way. Creative imagination is needed to face all obstacles. For examples, instead of printing hardcopies of glossy colour brochures, you can utilized the internet to spam the market. Share your office, share your phone bills, utilized 2nd hand furniture and computers. Employing the Art of Barter,create a win win situation for all parties. You need to loose some to gain some. Every lawyer tells you that contracts must cover all possible circumstances and they charge you at a fly high cost, but you have forgotten that there is no point in suing a bootstrap business because we don’t have money to give anyone. An astute way of avoiding hefty professional fees is to invite your key contacts joining your advisory boards.
3. Getting alternatives Financing – If you had a rich father, lure him into the business ~ lol (without his control). Banks seldom borrows to a bootstrap business, the alternatives ways can only be friends and family or governments and clients. Getting your first line of credit can take time and patients, but please provide an “excite” to the creditors, is best with a confirmed Sales Contract on-hand. Or ask your clients to advance your payments for you to kick-start.
4. Managing that Precious Cash – Create your cash flow forecast, plan your cost, and reduce any possible unnecessary expenses. Some research and negotiation with different vendors/suppliers/services provider is needed to understand your cost in-order for you to plan your cash flow. Employ progressive payments and advance payment and spend less. Motivate and maximized your staff capabilities. (If you don’t have money for meals, eat bread and cheese everyday to get you fuel up, joking.)
5. Marketing on Shoestring – Ignore on Market Research and Advertising on the start. You can think of a FREE Model to assist your marketing objectives. Pick a clear cut message and promote your differentiation and take advantage of today’s technology with internet marketing. Put in clear strategy and avoid to be blown in all directions.
6. Focused Directions and Vision – Small companies tends to diversify too much in all areas in-order to survived. Taking our animation company which focused on cartoons development as example, why not we take up some advertising jobs or graphic design job in-order to sustain the company. My answer will be NO. In my own opinion, being too diversify with different areas makes your company looks unprofessional, and worst, it may even get your company to no where because you do not have a  clear objectives and directions for your company. I prefer to focused on 1 area, and be the best of that area.

Please do share with me if you had any other ways to bootstrap a business. Businesses have to help each other to ride through the tough times.

1. Purpose of grant: Hooraay~~~ Malaysian will enjoy high speed broadband in the near future!! However, the authorities are afraid that the broadband penetration rate will still remain low after the implementation. Hence, the objective of this grant is to generate more local contents to encourage the nation broadband penetration. Hence, your proposal and business model must be able to align with their strategy in promoting broadband uptake in Malaysia. In actual, with or without the grant, with high speed broadband, i see a lot of opportunities ahead for businesses such as IPTV and etc.
2. Amount of grant: RM100,000
3. Duration: 8 months
4. Application Flow: The application flow for ICON grant is rather different from  PRE-SEED. For Pre-seed, after submission of application, you will need to present your ideas to the panels yourself. However, for ICON, after submission, you will be assigned with a representative from the ICON community, and you will present to your representative, and your representative will present on behalf of you to the panels. There is a possibility that you will also need to do the presentation yourself if the panels has doubts and they need further information or better understanding from you.
5. Disbursement method: I hope I did not interpret this wrongly from MDEC. If I do, please do correct me. PRE-SEED disbursement will be given upfront by MDEC in quarterly basis. However, ICON will be rather different. The phases are structured in 2/3/3 format. which means 2 months + 3 months + 3 months = 8 months. If I did not interpret wrongly from the community, the first 2 months, 20% of the requested amount will be given upfront from MDEC, but the remaining quarter, you will need to fork out your money first, and claimed back as proposed. In another word, if you are requesting for max RM100k, you need to have extra RM40k to survived the first 5 months after 20k has been disbursed.
6. Type of Programme Supported: Please read the following links = (ICONapps, ICONedu, ICONity, ICONex)
7. Forms and Application: Please contact them via their email to obtain the forms and application.
8. More details please contact them personally via their email. Please download the infopack

A few months back, I was helping a friend with their grant application, great business model with great proposal written. However, they failed due to poor presentations. A brief recipe of what you should be present:

1. Problem – What is the current problems in the market which you found it as an opportunity ?
2. Solution – The solutions to the problem. What can your system do?
3. Product – The main features of your product that provides the solution.
4. Demand – Show them the demand from the market. Tell them this is what the market wants. show them letter of interest.

I believe most of the you might have known of the above recipe. but what you have not notice which kengyew has pointed out, and I totally agreed with that. Things you should get notice for your presentation:

1. Don’t put your panels to sleep nor giving them a headache:
   • This is one of the mistakes that my friend did. The panels are listening to more than 20 presentation a day, they are tired, sleepy. So, Stop listing all the features that what your system can do.
   • Example, you are pitching to built a Toilet bowl with a system that is able to analyse human health condition by examine the faeces (your stool).
   • Hence, you do not list down every single feature of the toilet bowl from flush tank, design, flap seat, ass washer, can do this, can do that and bla bla bla bla bla etc. How boring was that!!!
   • All you need is to find out your few main unique feature, and focus on that only. the rest, mention in brief.
   • if you list down too many features, it looks more like a rojak system instead of a uniquely defined product, and may open up more problems and question for the panels to haunt you down.
2. Tell Stories
   • “Imagine, every morning when you are sitting on your toilet bowl, there is a nice sweet voice with background music, reporting on your health condition, advising you the amount of water you should drink, print and plan the type of food you should eat. Apart from that, if your ass get too numb, you get to comfort your ass with the massage system”,
   • rather than …“The toilet bowl that we proposed will have voice reporting system, a built-in speaker, a printer that will list down the amount of water should drink and the food to consume. and also, a built-in X2131 latest model of massage system.”..ZZZzzzzz …. who cares about X2131 model.
   • I am not a good story teller, that’s why I plan for my presentation with stories. Preparation is needed.
3. Is all about Emotion:
   • You don’t present like you have just gotten up from bed or your dog just died last night.
   • You need to show PASSION and EXCITEMENTS. Give me the money or i will ….~!

1. Provide a world-class physical and information infrastructure. - MSC Status companies will required to move into office area which was awarded with MSC Status. There are now approximately 14 office area are classified as MSC, namely Bandar Utama, Cyberjaya, KL-Sentral, KLCC and more will be coming in within the next 1 year.  World class infrastructure really sounds great, however the cost is respectively high as well.
2. Allow unrestricted employment of local and foreign knowledge workers - as from what I know, MSC has direct collaboration with the Immigration department to speed up the process for hiring foreign knowledge workers, which reduces your hassles in foreign employments.
3. Ensure freedom of ownership by exempting companies with MSC Malaysia Status from local ownership requirements. - is this means by foreign investor are able to take up majority ownership? I will have to check this out.
4. Give the freedom to source capital globally for MSC Malaysia infrastructure, and the right to borrow funds globally.
5. Provide competitive financial incentives, including no income tax for up to 10 years or an investment tax allowance, and no duties on import of multimedia equipment.
6. Become a regional leader in intellectual property protection and cyberlaws.
7. Ensure no Internet censorship.
8. Provide globally competitive telecommunications tariffs.
9. Tender key MSC Malaysia infrastructure contracts to leading companies willing to use the MSC Malaysia as their regional hub.
10. Provide an effective one-stop agency – the Multimedia Development Corporation.

Being an MSC Status company, you will also enjoy the services such as Business Matching provided by MSC. MSC will collaborate with agents of MARTRADE, MIDA and etc around the world to match your business with other businesses in foreign country, providing you an opportunity to venture into the foreign markets. Middle East countries are very favourable to MSC Malaysia Status. Apart from that, employment of internship will also subsidized by MSC with an amount of RM500 each.

As a recipient of Technopreneur fund, our company is eligible to apply for the status, however, not all Technopreneur recipient are qualified for the status. MSC will look into your business model, and the revenue source as the based line, specially your revenue model. If your revenue model are too complex or too exaggerate and it does not matches your business model, or it sounds too un-logical to them,  your chances are limited. God bless me, hope my company are qualified for it.

For the past few months, we have been brainstorming with some friends who is interested to apply for the grant. Eventually, they did not manage to get it. Some of the reason is due to the presentation was not well prepared. Here are some of the systems or ideas that I feels that is not suitable or it is much more difficult to apply for the grant.

1. Accounting Software – There are too many established accounting software in the region, even how niche, or how well you could differentiate your software, it will be difficult for you to compete with the established one that has almost penetrate most of the market share in their region.
2. Directory or Classified Portal – Examples, a Wedding Portal, listing of directories and branches for all the bridal house, linking up the bridal houses, or even implanting a wedding scheduling system sounds great. But it will not interest the panels. and most does not deserves 150k for development of such sites. and i do believe a lot of people proposed wedding portal in pre-seed before
3. ERP/CRM software – No matter you are doing a small scale or big scale of an ERP system, with financial module, inventory module, production, CRM , PO and SO etc. I still feels that the situation is same as the Accounting software. where you will faced difficulties in penetrating the market. Companies like SAP, Microsoft AX, PeopleSoft has many years of experience in the field, and has done a lot of research and developments for many years.
4. Buy and Sell Portal – If you are trying to create another ebay system, or lelong.com.my, I suggest that you do it on your own without the funds. You will faced questions from panel saying that they can used less than 5k to complete a buy and sell portal.

I believes there are more that is not suitable for preseed fund, but I just can’t recall. However, the above mentioned ideas is just an opinion, it doesn’t mean you cannot apply, but an extra effort is definitely needed. For an example, just to crap a bit on the ideas. Maybe you decides to create accounting system, you can differentiate that your system is over the Internet, and you are able to ensure your software is robust enough in-terms of security perspective, plus additional features to tackle the existing problems in the market. So, you can still leverage the existing technology or software, is just that how you can differentiate yourself in terms of technology, business model, strategy is more important. Anyway, it is just a crappy idea.

Just to recap on the tips and guideline for application for funding, you can visit here: http://cheehoong.com/entrepreneur/basic-tips-and-guide-for-applying-ict-funding-in-malaysia

There are various of incentives, grants and soft loans provided by SMIDEC and their agencies to assists and promote Malaysia’s SME and SMI. Imagine at the interest rate of 2% for a soft loans with range from RM 50k to RM 3 Million, as compared with the banks, you can earn more even if you save it in a fixed deposit. (of course, there are terms and condition applies, please do check out their sites for more information). Apart from that, there are schemes for Franchise Developments, Marketing, Office Rental Subsidized, Office Equipments and etc. So, why wait. Hurry up, make your call.

Money always the first priority, I will leave the other supports and services provided by SMIDEC for you to explore, I will mainly focus to provides links that are Money related.

• Small & Medium Industries Development Corporation (SMIDEC) – for Business Start Ups, Product Process Improvements, Packaging, Certification and Soft loans
• Malaysia External Trade Development Corporation (MATRADE) – Marketing and Brand promotional fund
• Malaysia Productivity Corporation (MPC) – List of Management programmes, such as Quality management, productivity management and etc.
• Malaysia Industrial Development Authority (MIDA) – Incentives for various industry range from Manufacturing, High-Tech to Small scale companies.
• Ministry of Entrepreneur and Co-operative Development (MECD) – Schemes for entrepreneurs, including of franchise development, seed capital, Graduate Entrepreneur and etc.
• Ministry of Agriculture and Agro-Based Industry (MOA) – Food Food Food, and agriculture based funding scheme.
• Ministry of Rural Regional Development (MRD) – For the Bumiputras to rebuild and developed their kampungs….
• Malaysian Technology Development Corporation (MTDC) – Acquiring new Technologies from abroad? or Research a new high tech gadget to bring down iPod?
• Malaysia Venture Capital Management Berhad (MAVCAP) – Cradle Investment Programmes and Venture Capital Financing, as mentioned on previous blog entry.

Hence, I would like to share some information here that might be useful to those that are in the middle of applying the fund. No matter which funding option that you are applying for, please be aware for the few issues that I highlighted here. I don’t mind to re-mentioned the tips again.

Info 1) Understand your Business Plan from Top to Toe

I am not an expert in writing business plan, but i had everything in my mind. I am not going to elaborate on value proposition of your business, marketing plan, targeted market, competition, financial plan and technology plan, I believe you know better than me.

1. Understand your product Niche and Uniqueness.
2. The Win-Win situation between you and your customers. show it in your plan. show it in your presentation.
3. Understand your competition. Strategy to tackle potential competition.
4. Never say there is NO COMPETITION, and thats the most stupid thing to mention. No matter how niche or how unique your product is, your idea is obsolete within the 10 second when you thought of it, and there might be 1000 people already working on it.
5. Show Facts and Figures to support your plan. Research, Research and Research. Google is your best friend.
6. 1 Plan is not enough. A plan is just a guideline, plan changes. Thats why always have a Plan A, B and C. Put Plan A as priority.

Info 2) Filling up the Application Form correctly:

Your application form determines whether you stand a chance to present your ideas.

1. The person to approve your form does not really care about your idea, but they care more if you have fill up the forms correctly according to their standards.
2. Do not make assumption on filling up their application forms. Specially on the financing part. example, if the fund does not includes for marketing purpose, don’t assume and don’t be so clever to include that when filling up the form. Your application will be rejected due to your clever actions. Assume stands for making an ASS between U and ME.
3. Call them up directly, arrange an appointment with them, or get a 1-to-1 advisory to advice you on how you should fill up your application. It’s best you fill up the application form first, then arrange an appointment, let them comment on your application, and repeat until you get your form correctly written.
4. Don’t write grandmother stories for your applications. Be straight forward, and write in point form. Who the hell is going to read your stories where there are 100+ applicants waiting for them to approve. Concentrate on Executive Summary, the interviewers might only read that! but don’t forget the rest of the content as well. (there might be one picky one that reads all of it).
5. The person to interviews you are the one that evaluates your ideas, and most of them don’t read your proposal, they will read the Executive Summary.
6. Hence, Fill up your forms correctly. You don’t fill up correctly, you have eventually marked an end for your GREAT ideas.

Info 3) Get ready for Defense and Attack Game

I had my first presentation slides ready after i handed over my forms, instead of waiting for an interview, i did extra preparations by presenting the business plan to my father’s friend, which is a CEO of a financial consultancy company, and my uncle’s friend, which was also someone who holds a high position in a big corporate. Both has nothing to do with the industry within my business plan, I just want to get screw up and receive some feedbacks from someone at the top level management, and i treated them as potential VC’s. Both of them has different opinions. One of them is more picky for my presentation skills, the other wants to know how my money is earn. 2 of them guide me in on my slides, my presentation skills and the things i needed to prepare.

1. You only got 10 Minutes to present. You need to cramp up your 30 pages business plan in 10 min. The sequence of my presentation slides: What is my product? > The niche and uniqueness > Targeted market > Market Potential > Competition > Barriers for competition > Potential Growth of the business > ROI as summary > Thank you. (Note: The sequence is just a guideline for you. Don’t follow my sequence, my sequence is based on my Business plan and my way of presentation. 10 min is considered long, i was given only less than 5 minutes to show what i have when i present to the CEO)
2. Practice more on your presentation skills. I can’t remember how many times i have practice alone in front of the mirror. But i have presented to both of the 2 top managements at least 3 times each.
3. Time your presentation. Practice with your business partner. Time yourself with a stop watch. Try not to exceed the time given. Go slow and Steady.
4. Continuously refine your presentation slides until you feel that it is enough to convince the panels. example: I replaced Sales and Marketing Plan with Market Potential, is because showing the potential market is more convincing than marketing plans. Marketing strategy is important, but my objective is to convince the panel that this is a viable business, so, Market Potential tends to weight more important at this stage and time is limited for presentation.
5. Get support letter from potential customers to strengthen your idea. Call up your potential customers or targeted markets, present to them, get feedback and get a support letter from them. We called several potential customers which includes TV3 and UNICEF. However, we only manage to present to UNICEF right in the morning before our 2nd interview with MDEC in the afternoon, we got a good feedback from UNICEF, but we did not manage to get a support letter, cause that needs a lot of process and approval from UNICEF internally.
6. Spot the Q&A question. Write down the potential questions, and your Answers, then from the answers, what will they question again, and answer again. Bring in the piece of Q&A you written during your presentation as bullet prove vest. When one is tackling the question, the other is searching for the right answer.
7. Get a Sales and Marketing Partner, some one who could present and up sell your ideas. Technology Geeks mostly are not good presenters, like me. Technologically you may be good, but technology is only part of the business. You need a marketing representative in your business. They may not be able to help you in developing your idea, so what, in long run, u still need someone to do the sales for you. You can sell the product yourself? Trust me, you can’t, unless you are an experience marketing guy. If you are a marketing guy, you won’t be sitting 24 by 7 in front of your pc.
8. Wear and act professional. Get a tie, shake your hands when u meet the interviewers.

Last but not least, this is just an opinion, hope it is useful. Good luck to your application.