Jim Rogers Picks Financial Tiger for First China Startup Investment

caixinglobal 2017-03-31

(Beijing) — An online brokerage that lets Chinese buy U.S. and Hong Kong stocks has become the first China startup backed by veteran investor Jim Rogers, who is betting on growing demand for more offshore investment choices from mainlanders.

Rogers disclosed his investment in Tiger Brokers at a briefing in Beijing, as the company disclosed its latest fundraising totaling 100 million yuan ($14.5 million). He declined to say how much he invested in the latest funding round.

The new money brought Tiger’s fundraising total to 400 million yuan to date, following two previous rounds, including one in December. The company’s app allows users in China to buy stocks in the U.S. and Hong Kong, giving them access to offshore-listed local giants like internet companies Tencent Holdings Ltd. and Alibaba Group Holding Ltd., as well as PC maker Lenovo Group Ltd. and wireless carrier China Mobile Communications Corp.

“Tiger is at the right place at the right time,” Rogers, a longtime China investor, told a group of reporters at the company’s Beijing headquarters. “Unless they do something foolish, they’re probably going to make a lot of money.”

Founded just three years ago, Tiger is one of a growing number of venture-funded, internet-based financial services companies that have sprung up in the last decade as China opens up a sector previously dominated by big state-owned banks. Such privately funded companies are typically better at serving consumers and private businesses, which have been neglected by older big banks more accustomed to dealing with other state-owned enterprises.

Despite slowing in the rest of the world, investment in such companies, often called fintech, has been growing rapidly in China, according to a report released by KPMG last year.

Tiger’s CEO Wu Tianhua declined to comment on his company’s plans for a potential future IPO.

But many of the sector’s oldest and fastest-growing players have discussed plans for offerings, with at least two or three expected later this year. One of those, consumer microlender Qudian, is aiming to raise up to $1 billion in a New York listing by the end of June, a source close to the company previously told Caixin.

Another company, peer-to-peer lender Lufax, has said it wants to make a listing of similar magnitude as early as this year, most likely in Hong Kong. But the largest listing by the new generation of fintech companies is likely to come from Ant Financial Services Group, the former financial services arm of e-commerce giant Alibaba, which is also expected to come make an IPO as early as this year in Hong Kong, China or New York.