Although it has just commenced research and development (R&D) operations in 2012 and only began engaging with customers in early 2013, Millennium Substrates Sdn. Bhd. (MS) is already creating waves within the industry. The company has the potential to grow, to become one of the pioneering SMEs in the LED industry. MS is a thermal management specialist supplying thermal substrates for LED packaging and assembly.“LED substrate manufacture is one of the four missing links in the Malaysian LED cluster. This means that domestic suppliers or producers of substrate supplies are virtually non-existent. As such, Malaysia imports about 95% of LED substrates, which invariably increases the local production costs. We saw the opportunity to fill in the gap, thus MS was established,” says Mr. R. Remakantan Ramachandran, Chief Executive Officer of MS.
MS through its own R&D activity successfully developed a Thick Film Electronic Substrate suited for the LED industry. This is a first-of-its-kind technology in the world, and has been tested with two of the top five LED players in the market. This substrate is made from aluminium, a readily available base material that is thermally efficient and low in cost. In doing so, MS has positioned itself as Malaysia’s first reliable local supplier offering substrate supply at a significantly competitive pricing. Given that no other company or individual in the world had successfully mass-produced thermal substrates using this technology, there was no benchmark for MS to compare itself. MS seized the opportunity to become the pioneer in this niche market, and has pushed the envelope by adopting best practices used in the Solar Cell industry in mass-scaling its technology.
This achievement would not have been made possible without the visioning and sufficient funding, according to Mr. Remakantan. In fact, this was their main challenge as they were setting up the company. “MS is funded by a private ‘angel’ investor who believes in the company’s potential, and seeks to commercialise the outcome of our technological research and turn it into a mass-production process. Yet, even with the assistance given, our team still needs to ensure overheads stay low by leveraging on the goodwill of other industry players and suppliers, and keeping our equipment and staffing down to the essential,” Mr. Remakantan explains. Besides the private funding, MS managed to secure a Pioneer Status Incentive, as well as R&D and Training grants from the Malaysian Investment Development Authority (MIDA) in the first quarter of 2012. The Government facilitation greatly helped in reducing the company’s burden of project financing. In addition, MS also received practical networking and business access support from Malaysia’s Northern Corridor Implementation
Authority (NCIA), MIDA and SME Corp. Malaysia. Through these agencies, MS was introduced to potential customers and was included in the Solid State Lighting Cluster meetings every quarter, which helped in increasing their brand presence and visibility. Speaking on how SMEs can thrive despite their specific constraints, Mr. Remakantan says, “To develop a successful company, I believe that there are certain challenges that a company has to endure. Like MS, SMEs are faced with limited resources in the areas of financing, human resource, and sometimes, even technology. Nevertheless, the key is to manage these finite resources effectively to achieve maximum results. SMEs would also need to be focused on meeting the specific demands in their chosen industry”. The Government too assumes an important role in helping SMEs like MS to grow. Many SMEs have great solutions, but lack the ability to effectively position themselves in the market, whether locally or internationally. Partnerships between MNCs and local SMEs should be encouraged to enhance market access, as well as to raise the quality and competitive levels among SMEs.Currently, apart from working towards commercialising its Thick Film Electronic Substrate technology, MS plans to evolve into becoming a thermal materials and solutions provider – adopting hybrid solutions that can be mixed and matched according to customer requirements. With that in the pipeline, Mr. Remakantan expects that there will be more challenges coming their way. Factors such as the impending weakness in the global economy and increasing cost of raw materials are predicted to impact the rate of growth and profit levels of the company.He remarks, “For MS, the commoditisation of LED products is forcing a downward pressure on prices. The scenario of how prices have declined in the Solar Cell industry in 2011 is happening in the LED industry today. The challenge for us then, is to continue to find innovative ways to lower the costs, while looking out for opportunities in niche high-margin markets”.“However, overcoming these challenges will provide us with new opportunities. We know that we are in possession of a technology that will be well-received in the market. So, in order for us to experience continual growth, we would need to employ self-discipline, consistency and persistence until we attain our breakthrough. It is only then that we can truly say we have made it”. MS seized the opportunity to become the pioneer in this niche market, and has pushed the envelope by adopting best practices used in the Solar Cell industry in mass-scaling its technology