Chinese venture capital firms turn focus to South Asia as soured ties hurt business outlook in the West, investors say
Some Chinese venture capital firms are looking for opportunities to scale up their operations in South and Southeast Asia amid heightened geopolitical tensions between China and the US, investors at a business expo in Macau said.
Gobi Partners is eyeing opportunities in Pakistan, given the country's young population, increasing internet and mobile banking adoption and the government's efforts to create a conducive environment for investors, according to co-founder and managing director Thomas Tsao.
"From a political standpoint, China and Pakistan are fairly close, and that is a big market opportunity," Tsao said on Thursday at Beyond Expo, billed as Asia's largest event for tech innovation trends. Some of the start-ups backed by Gobi Partners are showcasing their products and services at the expo in Macau.
Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.
Speakers at one of panel discussions at the Beyond Expo in Macau on May 23, 2024. SCMP/Mia Castagnone alt=Speakers at one of panel discussions at the Beyond Expo in Macau on May 23, 2024. SCMP/Mia Castagnone>
Some 500 speakers and 800 exhibitors from industries including healthcare, sustainability and consumer tech were gathered at the annual event. Celebrities including football star and entrepreneur David Beckham and singer Jackson Wang were also invited for fireside chats.
Chinese electric-car battery maker Contemporary Amperex, known as CATL and the Macau government announced an agreement to promote green development in the Guangdong and Hengqin regions. They will leverage CATL's scale, market, technology and talent to pursue those efforts.
The Grand Lisboa casino building against the backdrop of Macau skyline. Photo: AFP alt=The Grand Lisboa casino building against the backdrop of Macau skyline. Photo: AFP>
While geopolitical situations may alarm companies and investors, Tsao noted that as an early-stage investor, Gobi Partners takes a "glass half-full" approach, adding that the firm looks at broad trends to understand what is going on in Asia.
Chinese tech companies like short video platform operator Kuaishou have been looking beyond China to seize huge markets in Indonesia, Brazil and the Middle East. Super Hi International, an offshore unit of Chinese hotpot restaurant chain Haidilao, hopes a US listing will help boost its international presence.
Chinese companies are eager to expand their footprints in offshore markets and replicate their business models there, according to Ian Goh, the founding partner of 01VC, a Shanghai-based early-stage venture capital firm.
A "light touch" approach to expansion, whereby talent from China is exported to other markets to kick-start a new set-up, may no longer work in today's complex business and political environment, he added.
"We are looking at bringing the entire supply chain from China to our global market," Goh said at the expo. "We had to rethink that strategy" as companies will need to negotiate different and tougher regulations in each market, he added.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.
Copyright (c) 2024. South China Morning Post Publishers Ltd. All rights reserved.