Following is the transcript of a CNBC interview with Isaac Ho, Chief Executive Officer of Venturecraft. The interview was broadcast on CNBC on 27 April 2017 at 12:40PM SG/HK Time, during CNBC's "Hong Kong versus Singapore" theme week.
All references must be sourced to a "CNBC Interview".
Interviewed by Dan Murphy, Correspondent, CNBC and Pauline Chiou, Anchor, CNBC.
Dan Murphy: You are a Singaporean but you run a Hong Kong based VC firm. Now that's pretty interesting. Why is Hong Kong a better place for you to do business over Singapore?
Isaac Ho: So I would say that we're a regional VC. So Singapore and Hong Kong have become the base. The reason is because a lot of our activities is actually bringing US-based technology companies through Singapore and go into Mainland China. So Hong Kong becomes a very natural base because the proximity is there. And also there's a lot of activities also when we want to connect from Hong Kong all the way up to China.
Dan: So what cracks, what vulnerabilities do you see in the Singapore ecosystem that keep you out of this market?
Ho: Right. I think first and foremost is Singapore is still a very young ecosystem at the moment, so we are also looking at how are we going to improve the number of deal flows. So for example for Venturecraft, we actually venture all the way to Boston and to San Francisco because while we concentrate and focus on medical technologies, we see that the origination of the source still remains in the States, and the states right now, many of the visits are also encouraging that their portfolio companies come to Asia, basically for revenues. And one of the biggest market that Venturecraft believes is actually the United States and also Mainland China.
Dan: Okay. But there's still a little bit of competition out there. Let's bring in my colleague Pauline who also has a question for you.
Pauline Chiou: Yeah, Isaac, great to see you. I want to ask you a little bit more about your investments in the medical tech and health industries. You say that Venturecraft is really meant to be a bridge between Singapore and the US and also China, but how do you operate in both markets which are so different, and you could argue, suspicious of each other, different markets with different regulations.
Ho: I think one of the advantage we have is that we learn to localize. So for example when we work with the Americans, especially the Americans founders, one of the things that rely on Venturecraft is actually the localization expertise that we have. So for example we actually operate the incubator in Hang Zhou where it's in Zhejiang China. And over there, building where we bring companies over there, we actually help the assistance in the medical validations, even the regulations and also the teams' setups. So one of the greatest advantage that we see ourselves as Chinese and being bilingual is the ability to bridge that part between the Europeans and the US market, right into Asian market. So U.S. becomes one of the places for our deal origination whereas Hong Kong and Singapore becomes a jumping bridge for us to go into Southeast Asia and as well as Greater China.
Pauline: Looking at the portfolio of your company is quite diverse, you have a fintech company, you also have an investment in a company that helps people apply to colleges overseas, you also have luxury e-commerce but a bulk is now in medical health so is that we're shifting your focus?
Ho: Yes when we started investing, in our, back in 2014 our focus is actually working with the Singapore government and also Singapore MIT Alliance, to be looking at Singapore registered companies that have deep intellectual property. So when we ventured into this that was when we were operating five million small fund where we actually invest 500,000 and under, that's the part where we actually get our hands and understand that in Singapore we actually find great intellectual property companies that has good deep technology. So when we come into Venture Kraft 2 which is the 50 million, we begin to see a shift to where there is actually a gap in the later stage funding and many of the companies actually happens to be in the medical technology and life science there's where you actually can put in a one to 10 billion dollars in investment. So this becomes an opportunity for us. That's the reason why we actually from going from very early stage right now we are investing more into a late stage startup.