How Fave founder’s new VC firm helps Malaysian entrepreneurs make their First Move

First Move, an early-stage fund launched last year by Fave founder Joel Neoh and former head of its BNPL unit FavePay Later Audra Pakalnyte, announced on Wednesday that it backed ten Southeast Asian startups in the first year. With an average investment size of US$100,000 per startup, the VC firm has invested in companies, including The Giggly Company, Evo Commerce, DeCube, Save Day, Koppiku, 3Cat, PayGap, and Collektr. A key highlight is that 35 per cent of the founders it has supported so far are women.

In an interview with e27, Pakalnyte discusses the VC firm’s mission, vision, investment thesis and how it contributes to the country’s startup ecosystem.

Can you share about First Move’s mission and vision for supporting early-stage founders in Malaysia?

First Move aims to fill a critical and often overlooked gap in VC financing, specifically at the idea stages (pre-seed funding, often at the pre-product/pre-revenue stage). Our mission is to invest in capable founders at the very inception of their entrepreneurial journey, thereby encouraging more entrepreneurs to launch their ventures.

Also Read: Dream big, start small: Joel Neoh shares lessons from his years with Fave

By focusing on this early and pivotal stage, we aim to accelerate the development of scalable ventures and nurture local talent, providing them with the essential resources they need to grow and succeed.

What sets First Move apart from other early-stage funds, and how does your team’s entrepreneurial background influence your investment strategy?

First Move is a fund by entrepreneurs for entrepreneurs. Our firsthand experience in building, running, and scaling businesses informs our investment strategy, enabling us to understand the unique challenges and opportunities faced by startups.

This perspective allows us to offer practical, actionable advice and support to our portfolio companies. Our approach is not just about financial investment; it’s about building a partnership and providing a supportive ecosystem that enables founders to thrive.

Can you walk us through the selection process for choosing the ventures you’ve invested in, mainly focusing on affordability, financial inclusion, and the circular economy?

Given our focus on very early stages, often including pre-product or pre-revenue startups, our primary criterion is the strength and experience of the founding team. We value founders with diverse backgrounds, deep domain expertise, proven operational experience, and the leadership skills necessary to steer a startup through its formative stages.

Additionally, the industry space and the market size represent critical factors in our evaluation process. We meticulously assess the potential of each venture to address significant needs within its target market, considering the innovation and value proposition it brings.

The opportunity for regional scalability is another crucial criterion; we look for ventures that can expand beyond their initial locality, envisioning how they might capitalise on the broader opportunities within the region. We look for ventures that not only promise commercial success but also have the potential to make a positive social impact.

It’s impressive that 35 per cent of the founders you’ve supported are women. How does First Move prioritise diversity and inclusion in its investment decisions, and what benefits do you see in fostering a diverse startup ecosystem?

We prioritise talent and potential in our investment decisions, focusing on nurturing diverse talents. While 35 per cent of the portfolio companies’ founders are women, our commitment extends beyond gender, aiming to empower founders from all underrepresented groups.

We believe diverse teams bring innovative perspectives and solutions, driving creativity and problem-solving in the ecosystem.

How does First Move collaborate with other VCs and stakeholders in the ecosystem to maximise the impact of its investments?

We view collaboration as essential, working alongside VC firms and ecosystem stakeholders to enhance the impact of our investments. Since we invest at very early stages, building a pipeline of investable ventures, aligning with the country’s long-term goals and regional economy is crucial. This alignment ensures the ventures we support are scalable, investable, and capable of contributing to economic growth and positive social impact.

In what ways do you envision First Move contributing to Malaysia’s startup ecosystem in the long term, particularly in terms of economic growth and job creation?

We are dedicated to backing Malaysian and Malaysia-based founders, including the Malaysian diaspora starting businesses abroad and foreigners starting ventures in Malaysia. This commitment to a diverse range of entrepreneurs aims to spur innovation and scalable growth, significantly enhancing Malaysia’s entrepreneurial landscape.

Also Read: Joel Neoh joins hands with ex-Fave colleague to launch early-stage fund First Move

Our strategic investments align with the country’s broader economic and social goals, ensuring our supported ventures positively impact Malaysia’s economy and society.

What are the critical focus areas for First Move in its next growth phase, and how do you plan to continue empowering visionary founders in Malaysia and the broader Southeast Asian region?

We remain committed to being the initial funding source for startups, actively fueling the ecosystem with investable and scalable businesses. We focus on supporting ventures that develop tech-enabled solutions to consumer problems, aiming for a broader positive impact.

What is the impact of the funding winter on Malaysian startups? Crowdfunding platforms have been a significant funding source for Malaysian startups. Has this trend changed in the recent past?

The funding winter has presented challenges for startups globally, including those in Malaysia, leading to tighter capital availability and more cautious investment decisions across all stages.

For startups, this has meant a greater emphasis on demonstrating clear value propositions, sustainable business models, and paths to profitability. While the funding climate has become more stringent, it has encouraged startups to focus on operational efficiency, cost management, and innovative growth strategies.

This period has also shown that startups were exploring alternative funding sources, such as government grants, angel investors, and crowdfunding, which delivered excellent results last year.

We see this as a great time to invest in the early stages, as founders are building businesses with a strong unit economics foundation in mind from day one, which will lead to more sustainable business models.

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