Japanese Patent fund IP Bridge to raise $50m “Intellectual property and innovation” fund in Malaysia

On October 19, 2017, Japanese private equity fund “IP Bridge” disclosed its plan of launching a $50 million fund as a continuation of the ASEAN push for “Intellectual property and innovation” and signed an agreement with Malaysian local, Leonie Hill Capital (LCH) [1]. The agreement aims at investing in “IP rich or to-be-rich”, national and regional enterprises in Malaysia, and particularly targeting technology areas like the Internet of Things (IoT), wearable, robotics, etc. The agreement is a step towards accelerating the growth of startup companies in Southeast Asia.

This partnership between IP Bridge and LCH makes Malaysia the base of the first intellectual property innovation fund in Southeast Asia. As per the agreement, the two partners will focus their investments on technology companies that have substantial Intellectual Property or worthy enough to develop IP in the future and are working in IoT sensors, Robotics, Agri-tech, etc.

Further, the ManGo Factory program endorsed by the partnership provides support to venture companies for their overseas expansion. The partnership will “re-domicile more than 10 southeast Asian and Japanese start-ups in Malaysia, providing them with facilities, access, and market opportunities”. The partnership will provide wide support to the Start-up companies from commercialization, partnership/alliance, and access methods to the world market, and IP bridge can provide intellectual property utilization strategy and advice related to it. This collaboration of two companies will contribute to the development of Malaysian technology companies.

The Prime Minister of Malaysia, Najib Razak, said that since Malaysia is geographically located in the center of ASIAN countries and has an appropriate ecosystem for the growth of start-up companies around the world; it is an appropriate place for start-up companies in Southeast Asia and Japan to procure funds more smoothly. At this, CEO of IP Bridge, Shigeharu Yoshii said “an appropriate ecosystem is required for start-up companies so that delicious rice will not grow without rich soil, clean water, adequate sunlight, insects, frogs, etc.” and it’s a great honor for them to function as part of Malaysia’s innovation ecosystem to support startup companies.

Najib Razak also added that the startups raised through this fund will generate employment in the future and will also provide Malaysia with economic and social opportunities. The CEO of Malaysian Digital Economy Corporation (MDEC), Yasmin Mamoudo said that this Malaysia-based innovation fund is a clear indication of the growth of the Malaysian digital economy. This agreement which launches funds for innovation will keep Malaysia in the conversation as a regional IP center and further will boost up the relationship with an IP aggregation and monetization firm that is putting together a fairly good track record.

The fund raised by IP Bridge is the biggest one among Asia’s largest and most active IP funds. For a non-practicing entity to move into the start-up investment space is certainly not a new tactic. This type of fund motivates the companies that are seeking to show a skeptical domestic constituency that IP monetization can be part of a sustainable business model.

On April 26, 2017, in a press release on the Intellectual Property Office of Singapore (IPOS) online portal, it was published that IPOS announced a similar type of innovation fund named “Makara Innovation Fund” [2]. The Makara Innovation Fund was supposed to invest one billion Singapore dollars in highly growing companies which encompass a strong IP and convincing business models. According to government officials in Singapore, the money in that fund will be used to bolster the country’s IP ecosystem and will target high-growth companies with strong IP and proven business models, leveraging Singapore as a base for their growth and expansion into world markets. This was announced by IPOS and the Ministry of Law, along with updates to the IP Hub Master Plan.

Author: Shilpi Saxena, Jr. Patent Associate at Khurana & Khurana Advocates and IP Attorneys can be reached at shilpi@iiprd.com.

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