How to Fundraise with Equity in Malaysia?

Raising equity capital is a major milestone for any Malaysian company. Whether you are launching a new product, scaling operations, or expanding into new markets, the method you choose to raise funds will shape your company’s growth path.

In Malaysia, companies can raise funds by issuing shares through three main routes:

1. Private placement,
2. via an Unlisted Public Company (aka Unlisted Berhad), or
3. via a regulated Equity Crowdfunding (ECF) platform such as pitchIN.

Each route offers different investor access and compliance requirements. Here’s how they compare.

Private placements are the most familiar method for private limited companies. The company offers shares to a small group of selected investors—usually existing shareholders, friends & family, or venture capitalists, amongst others.

However, there are restrictions under Section 43 of the Companies Act 2016 whereby private limited companies are prohibited from inviting the general public to invest. Offers must remain private, and the company cannot have more than 50 shareholders.

This method suits companies raising small amounts from existing investor networks. 

Private companies may also convert into an Unlisted Berhad to access a wider pool of investors and raise larger amounts of capital.

Unlike private limited companies, UPCs are permitted to make offers to the public — so long as they comply with the Companies Act 2016 (CA 2016), the Capital Markets and Services Act 2007 (CMSA), and Guidelines on Offer of Shares by Unlisted Public Companies.

When raising funds this way, you have two main options, each with its own level of regulatory requirements:

1. Offer to Retail and Sophisticated Investors – requires a Prospectus, appointment of a CFA, consultation with the SC, amongst other requirements.
2. Offer to Sophisticated Investors Only – lighter compliance using an Information Memorandum (IM), and strict requirements to verify investor eligibility

When promoting your shares, you need to adhere to the SC’s Guidelines on Advertising for Capital Market Products and Related Services. If you decide to appoint an agent for marketing and promoting your shares, they must hold a Capital Markets Services Licence for dealing in securities.

Equity Crowdfunding (ECF) provides a present-day, regulated alternative to raise funds while remaining private. Through Equity Crowdfunding, companies can raise capital from the public through a Securities Commission (SC)–registered platforms such as pitchIN.

Exemptions under S. 43(3)(c) of the Companies Act 2016 enables private companies to offer shares to the public through arrangements that are prescribed and regulated by the SC. Equity Crowdfunding is one such arrangement that is regulated under the SC’s Guidelines on Recognized Markets.

Once you are approved for hosting on a regulated ECF platform, you may promote your campaign to the public through social media and/or other means by observing the SC’s Advertising and Promotion Guidelines. Refer here for some do's and don'ts when promoting your ECF campaign.

To-date, there have been more than 357 successful ECF campaigns in Malaysia, more than half of these campaigns were raised on pitchIN.

Malaysia offers several well-defined paths to raise equity capital, predominantly:

• Private placements for close investor groups,
• Unlisted public company fundraising for broader reach under SC and SSM regulations, and
• Equity Crowdfunding for a digitalize, transparent, and efficient fundraising.

The right route depends on your company’s stage, investor network, and compliance readiness—but each offers a clear, regulated path for Malaysian businesses to grow with confidence.

Sign up for an ISSUER account to start your fundraising journey!