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Thursday September 4, 2003
MSC-IAP: MSC fallout rate not alarmingBy JULIAN MATTHEWS
CYBERJAYA: The Multimedia Development Corporation said the 10-12% fallout rate of companies that received MSC status but were unable to execute was not alarming.
“It’s Darwin’s theory all over again. It’s the fastest and the most agile who will survive. The fact we have over 900 companies of which over 750 are operational is already unbelievable to most people,” said MDC chief executive officer Datuk Dr Mohamed Arif Nun.
He described the rate as “ reasonable” vis-à-vis Silicon Valley standards for a greenfield area that was only its seventh year.
MDC disclosed that of the 923 companies that have received MSC status, 97 companies had their MSC status revoked while 15 others were shuttered. Forty four other companies remained dormant, eight were yet to be incorporated, while two others were either merged or acquired.
Arif said the companies did not take off for varied reasons.
“Some did not incorporate themselves, some were dormant during the dotcom crash and some were not able to relocate to Cyberjaya. It was just a failure of execution,” he said.
He said the companies had come with “good intentions” and their business plans were vetted by the MDC.
Arif said those that failed to get their businesses up are quite “hardy.” “When they don’t succeed, they come back again. We are still willing to help. It’s part of the learning process,” he said.
The MSC status eligibility process was set up by the MDC right at the start of the project for companies interested in investing or doing research in the MSC. Companies had to meet specific criteria, one of which was to set up offices within the 750 sq km designated area within a set timeframe.
The lure for early international investors was the promise that companies that applied would get preference to bid for MSC-linked infrastructure projects.
Arif said MDC has established various technopreneur programmes to accelerate the setup process for new companies, including handholding technologists through their business plans, sourcing venture funds and providing a mentoring system and a network of incubators to set up base.
“It’s a whole ecology we are providing here to help them. We want to build a community here. We want to build a critical mass. We provide the right environment, all in one location. The technologists and businessmen need to meet eye-to-eye for things to happen,” he said.
Arif said that MDC has had no let up in applications.
“For the next phase, we are still getting applications. We approve about 100 to 120 applications annually and this is consistent and still on the uptrend,” he said.
“Watch this space. We have good news for the next phase.”