Amir said the sovereign wealth fund remains committed to its mandate of supporting the startup and venture capital (VC) ecosystem, which is important to Malaysia’s economic growth, while enhancing control mechanisms.

“VC investments drive innovation by providing capital to startups and companies with the potential to develop new technologies.

“They also contribute to job creation and economic stimulus, besides introducing advanced technology from external markets into Malaysia,” he said in response to a supplementary question from Syerleena Abdul Rashid (PH-Bukit Bendera) during Minister’s Question Time in the Dewan Rakyat.

Syerleena had asked whether Khazanah would reconsider investing in startups or adopt a different strategy following its RM43.9 million loss in Fashion Valet revealed last month.

The investment loss has been criticised by political figures and analysts, but the likes of Tony Pua, Khairy Jamaludin and Shahril Hamdan warned that excessive scrutiny of investment decisions could harm Malaysia’s entrepreneurial landscape.

The Malaysian Anti-Corruption Commission is also investigating Fashion Valet co-founders Vivy Yusof and Fadzaruddin Shah Anuar over the loss.

Amir said VC investments inherently involve high risks but offer the potential for high returns, if successful.

He pointed to Khazanah’s other successful ventures, such as its investment in Farm Fresh Bhd, a local dairy company that has generated more than RM800 million, over 13 times the initial investment.

He said since its initial investment in Fashion Valet seven years ago, Khazanah has refined its investment strategy and tightened its selection process, particularly for startups and VCs.

He also outlined Khazanah’s ongoing commitment to Malaysia’s startup ecosystem through initiatives such as the Jelawang Kapital, a national fund-of-funds with a RM1 billion commitment, and the Emerging Fund Managers Programme.