Asian HNIs to pump in up to $60m in startups via asset manager RE Lee Capital

Bao Vu, R.E. Lee Capital

At a time when traditional family businesses and wealthy individuals globally are increasingly looking to invest in new age startups, a group of high net-worth individuals (HNIs) and businesses from Asia have decided to pump in up to $60 million in about 30 early-stage companies in the region within the next two years.

The investment, to be done through Singapore-based asset management firm RE Lee Capital, will see up to $2 million each allocated to pre-seed startups in Asia in sectors such as real estate, retail and telecommunications, especially those based in Singapore, Hong Kong and Taiwan, the asset manager said on Tuesday.

Asia has the largest HNI population and wealth and is on target to surpass $40 trillion in wealth by 2025, according to Capgemini’s 2017 Asia-Pacific Wealth Report.

“Given the diverging tech trends impacting some of their (corporate families) businesses they are looking at alternative investment and one of it is in startups,” RE Lee Capital’s Investment Director Bao Vu told this portal in an interaction.

One of the businesses that has engaged RE Lee Capital for startup investments is Thailand’s Benchachinda Holdings. The Thai firm is interested in startups in smart buildings-related areas such as energy management, smart lighting, video analytics and IoT.

RE Lee Capital is, in fact, already in the process of investing in some startups. Vu said most of his clients are going to be strategic investors looking to initially pick a minority stake. The startups would be able to leverage the businesses’ distribution network and scale while the businesses expect to benefit from the technological innovation offered by the startups.

“In the coming decade, we will see a once-in-generation passing of the torch from the founding members of Asian business families to the next generation. This transition comes at a particularly dynamic time where the world is seeing technology disrupting traditional businesses across many industries. The pace of technological change has accelerated and many of the founders have recognized this,” Vu said.

The startup fund will be part of a larger suite of alternative investment products that RE Lee Capital is building to serve the region’s HNIs and business families. The asset manager will be launching three new funds in the next three months, including a blockchain fund, a technology mining fund and a managed futures fund.

“We believe that the startup scene in Asia is still largely unmined, with many exciting technologies still on the horizon. What we can provide is a strategic partnership that can bring insights and networks from traditional and time-tested Asian businesses to the emerging tech scene here,” Vu said.

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