Summary Chapter 10

The SKALI Netpreneurs Acceleration Program or SNAP actually had its humble beginnings in the early days of the dotcom boom. SNAP were hosting many dotcoms at our data centre. However, when the bubble burst, many of these companies could no longer afford to pay. Fundamentally, SNAP wanted to help their industry comrades who were facing tough times. After all, SNAP nearly went bankrupt a few years before, and it was through the kindness of many of suppliers and vendors, who gave SNAP leeway when they couldn’t pay up.

Azmi question made Tengku Farith think that he can make a formal service out of this and charge fees for it. The problem is they don’t have money to invest at start up then solved by tie up with an existing venture capitalist. Because of SNAP, Tengku Farith and Azmi had an argument that then their split their ways. The argument never solved and Azmi does not involve in SNAP anymore. The business model that Tengku Farith came up with is one where their earn commissions for matching start-ups with investors. Their also charge fees for nurturing the start ups as well as for the services the investor used.

Tengku Farith search for the good potential investor that their can invest in them. But their don’t have fund to do that and the opportunities come when Tengku Farith meet Jasmani Abbas, the CEO of Mayban Ventures, at Maybank’s Hari Raya open house in 1999. He told Jasmani about the idea and he agrees with him. Mayban Ventures had been given RM150 million by Bank Negara to fund technology companies. Mayban Ventures had traditionally been a VC investing in non-technology sector so this was a brand new field for them. Collaborating with SNAP would give them instant expertise at evaluating IT companies. The original idea was for SKALI to help Mayban Ventures source for start ups.

Finding suitable companies for Mayban Ventures turned out to be a lot harder, and then they manage to find a good web development company. It took a year to nurturing this company before submitting their application to Mayban Ventures. Unfortunately, certain unforeseen events began unfolding in the company. The CEO of the company destroys everything when he mixed personal problem into the company.

This gives the SNAP lesson to be more careful in their selection. At the first, Mayban Ventura doesn’t want to invest in Early Stage companies. Tengku Farith success to convincing Mayban Ventura to invest but the fund reduce to RM20 million and then SNAP manage short list 22 companies from 150 companies. Mayban Ventures ended up investing in 10 of them. By the end of 2003, SNAP had generated revenues of RM 700,000 and was a profitable division.