Improving Cambodia’s Startup Investment Ecosystem

More than 30 key players from Cambodian venture capital and private equity firms attended a workshop to discuss challenges and recommendations to strengthen the startup investment ecosystem.
Consultative workshop on "Assessment of Venture Capital and Private Equity for Investment in Startups and SMEs" (Photo: supplied)
Consultative workshop on "Assessment of Venture Capital and Private Equity for Investment in Startups and SMEs" (Photo: supplied)

The Entrepreneurship Development Fund (EDF) held a workshop last Thursday to discuss “preliminary findings and to gather input on challenges and policy for startups and SMEs investment aspects” in Cambodia.

More than 30 key players in Cambodia’s venture capital and private equity firms gathered to present at the discussion table to propose policy recommendations that will improve the startup investment ecosystem.

“There is an investment mismatch in the market,” the funding pillar of the Ministry of Economy and Finance (MEF) said in its statement after the consultation.

It pointed out challenges, such as inadequate quality enterprises, lack of funding firms, limited deals or disclosed information, limited exit options, high costs and complexity of regulatory compliance, and limited awareness and access to professional mentors.

Led by EDF’s secretariat director, Chea Kok Hong, the consultative workshop concluded with three recommendations. It called for boosting financial assistance by categorizing the fund into specific sectors and funding stages.

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Consultative Workshop on the study of Assessment of Venture Capital and Private Equity for Investment in Startups and SMEs
Consultative Workshop on the study of Assessment of Venture Capital and Private Equity for Investment in Startups and SMEs

The workshop also recommended more quality training to nurture professional fund managers, qualify startups and SMEs, and aggressively campaign for a risk acceptance culture, and locally and regionally entrepreneurial mindset.

“Be an enabler by reducing the compliance burden to attract VCs and deploying risk sharing mechanisms through co-investment.”

EDF’s Kok Hong said the results of the workshop will serve as comprehensive inputs to address the current challenges in the ecosystem.

“VC and PE investment is a key to faster economic growth and is one of the core elements in driving innovation and creating jobs in the economy, especially in the post- covid recovery,” according to the workshop concept note.

Yet, it added, “Despite the fact that there are many studies about the ecosystem and funds; however, most of them were focused on startups, and there were a few studies that revealed the number of investment firms, deal flows, and investments yet.”

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