Funds For My e-Business
Microsoft Malaysia, October, 2000
With opportunities opening up for small and medium-scale enterprises
(SMEs) to venture into e-commerce, how does an SME finance its
journey into e-Business?
While trying to get credit facilities from banks may be, more
often than not, an exercise in futility, there are other avenues
for SMEs to get funding for their plunge into e-commerce.
Mindful of the problems faced by SMEs in getting such funding,
the government's Small Medium Industries Development Corporation
(SMIDEC) recently launched a special scheme for this purpose.
Its E-Commerce Grant aims to assist SMIs quickly integrate into
the world of e-commerce to ensure their survival in a changing
globalized market place.
Under the scheme, successful applicants may receive a maximum
of RM 10,000.00. Assistance is given in the form of a matching
grant where 70 per cent of the cost is borne by the Goverment
and the balance by the applicant.
However, before you rush off to the SMIDEC office to get financing
for your company's website, there are several pertinent conditions
to consider. The grant cannot be used to develop individual homepages
or e-commerce portals.
It is meant only for SMIs companies to defray expenses in joining
an existing e-commerce portal or community. Each SMI company can
register to join up to a maximum of five e-commerce portals/communities.
The grant can be used for expenses such as consultancy fees, set-up
charges, first year web hosting, and first year payment gateway
- Secured Electronic Transfer (SET) and Secure Socket Layer (SSL)
Apart from the SMIDEC scheme, the private sector has also introduced
various initiatives to make it easier for SMEs to join the e-commerce
revolution. Malaysia-based website eOneNet.com
launched recently an e-business ownership campaign with the SMI
Association of Malaysia.
It is sponsoring 500 SMIs to get online by offering them free
web designs and a hosting service package for only RM300. Fione
Tan, the CEO and president of eOneNet believes that e-business
is the new way to do business.
Jaring, the country's first Internet Service Provider, will sponsor
a business Internet account for each of these SMIs by waiving
the registration fee and giving them free Internet access worth
RM5 each. Well, it is not much but it is a start!
Also aiming for the SME market is Celinco Consolidated (M) Sdn
Bhd, a subsidiary of Celinco Consolidated, a Sri Lankan-based
SMEs will be able to transact business with over 1.2 million merchants
from 129 countries through its eCeylinco.com portal. It is an
e-trading hub which draws together a virtual community of buyers,
manufacturers and sellers globally.
Another foreign company targeting SMEs and multinational corporations
operating in Malaysia is Hong Kong's Pacific Century Cyberworks
(PCCW). It plans to invest US$100 million over the next five years
to offer e-business enabling and Internet access services in Malaysia.
It will provide web-hosting, web-design, e-mail hosting, domain
name service, Internet access and global Internet roaming services.
The potential of SMEs in commerce has been acknowledged worldwide
with some of the Internet's biggest players building e-commerce
marketplaces or communities specifically for SMEs. This means
that for relatively little expense, small companies now have an
abundant choice of providers of virtual store fronts and related
On Sept 21, Microsoft launched its "Business Web Services", a
collection of hosted Web tools, e-mail, e-commerce and marketing
services that will be available on its bCentral small-business
According to Microsoft, these services will be available later
this year and cost US$24.95 per month. Microsoft's Business Web
Services will enable SMEs and SOHOs to register their business
name and build commerce-enable websites. It will offer e-mail,
calendar and document storage applications based on the Microsoft
Exchange Server 2000 and Microsoft Outlook.
There is another indirect route for SMEs to get money to fund
their e-commerce ventures. SMEs can reinvent themselves as dotcoms
or incorporate a subsidiary to handle the business' e-commerce
activities. After that, they can go the way most Internet start-ups
embark on - seeking funding from 'angels' or venture capitalists.
Given the crash in NASDAQ and financial troubles afflicting many
dotcoms worldwide, trying to get VC funds is no easy task. But
for those companies with commercially viable business plans, tenacity,
persistence and perhaps, a huge dose of luck, they may yet attract
investors to their web businesses and become winners in the New