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Micro-entrepreneurs (MEs) in Malaysia are suffering from a slow projection of growth especially when it comes to developing their business into larger scale business. This group of entrepreneur is important for Malaysia in achieving vision 2020. Concurring with this, the study aims to explain a factor that contributes to business progress of Malay entrepreneurs. This factor is being established based on the factor analysis outcomes from a survey conducted in Penang. A total of 300 questionnaires were obtained from different cohorts of Malay entrepreneurs. Based on the factor analysis, three factors were constructed to explain the demand made by Malay entrepreneurs for their business needs. The regulatory role is the significant demands which consist of eight items. Keywords: Micro-Entrepreneurs, Business-State Relations, Malay’s Entrepreneurs.