Strategy
The mission of the Fund Company is to identify, invest and nurture Malaysian (and a limited number of foreign) businesses operating in the technology space specified above, so that they will contribute to the overall economic growth of the country.
At least 30% of the fund will be utilized to finance start-up investments while the balance will be allocated to emerging companies that are at least some initial track records in commercialization.
Value-Add
DTAV will assume the role of an active investor on behalf of the Fund Company. Although DTAV is not likely to be involved with the day-to-day running of the business, it will be keeping close touch with the broad directions of the investee companies. In this respect, we wish to be intimately involved.
INVESTMENT POLICY
The selection criteria for our funds with respect to the target investments will be as follow:
- Management capability and integrity
- Proven market and concept (or technology) with a strong market position or competitive advantage
- Ownership of significant intellectual properties of commercial interests
- Good growth prospects or scalability
- Existence of an identifiable divestment strategy
Investment will generally take the form of equity participation in prospective companies and businesses. Investments may also take the form of convertible securities and options as an integral part of an investment structure. Short-term advances may also be granted on exceptional basis.
Maximum investment size per company for the Fund is MYR3.0 million. While the size is not huge, co-investors could be sought. The types of instruments proposed could be Common Shares, Convertible Preference and Convertible Loans. The ICT Fund is fully invested as at to-date.
Ideally and under normal circumstances, the Fund shall not hold more than 49% in each of the investee companies. Exceptions are allowed subject to internal approvals.
Lastly, holding period for each investment is limited to a maximum of 5 years.
Track Record
The partners of DTA have completed a total of 15 investments valued at MYR61.6 million (at point of invest). The deal size averaged MYR4.1 million with the largest being MYR14.0 million. The average IRR over a 5-year period is 19% gross. Industry exposure includes properties, manufacturing (electronics, plastics, food products and building materials) and trading (hardware and white goods).
Portfolio
The partners have invested more than MYR16 million in the following technology sectors for the present Fund:
Commerce service providers
Business process outsource
E-learning
Mobile messaging
Wireless security and anti-jamming systems
Wireless sensor network
Systems integration
Multimedia, entertainment and advertisement
Clinical software system
Hardware transmission equipment
Open source operating system