Hong Kong Is Reinventing Financial Services for the Digital Age

Quarterly Newsletter July 2020

Hong Kong is Reinventing Financial Services for the Digital Age

The FinTech development in Hong Kong has made significant strides since the first FinTech Week in 2016.

This Issue 3 International Forward Calendar 4-5 Special Feature: Business Support Measures 6 Sector Focus: Financial Services 7-15 Case Studies 2

The city is now home to more than 600 FinTech companies with over US$1.5 billion investment between 2014 and 2019. With the solid support from the HKSAR Government and regulators, initiatives such as virtual bank and virtual insurance licenses were granted, the city is transforming to a new digital era.

The Booming FinTech Scene The introduction of virtual banks in Hong Kong is a major catalyst to propel Hong Kong into the smart banking age. In 2019, Hong Kong Monetary Association (HKMA) granted eight virtual bank licenses. As of early July, two banks already fully launched their virtual services. The launch of virtual banks will certainly facilitate financial innovation, enhanced customer experience and financial inclusion.

In 2018, the Insurance Authority (IA) granted the first virtual insurance license. InsurTech is beneficial to both the industry and consumers as it stimulates innovation, enhances value proposition, improves customer experience and broadens financial inclusiveness. The Future of At the moment, there are four licensed virtual insurers and each with a unique background and business FinTech Adoption model, offering the prospect of accelerated FinTech The Hong Kong Institute for Monetary and development in Hong Kong, thereby bolstering Financial Research (HKIMR), the research arm our competitiveness as an innovation hub. and subsidiary of the Hong Kong Academy of Finance (AoF), released a survey in May 2020. The report indicated that incumbent banks see FinTech development more as an opportunity than a threat to their business operations. The top three financial services with FinTech adoption are personal finance, investment and wealth management services, and brokerage services. And, in the next five years risk management services Hong Kong is having the greatest potential. Preliminary results also FinTech Week 2020 show that increased cost efficiency and improved profitability are associated with more extensive (2-6 November) FinTech adoption by banks. Meanwhile, The upcoming fifth annual Hong Kong FinTech Week 86 percent of banks have adopted or plan to will take place at AsiaWorld-Expo in Hong Kong as the adopt FinTech solutions across all types hybrid of physical and virtual event. Building on the success of financial services. of last year’s event, a more business-oriented programme will be featured for the global FinTech communities, such as the FinTechHK Global Competition, Fast Track and Virtual Fairs. In addition, for the first time since its inception, the Hong Kong FinTech Week will have a B2C element where virtual banks will showcase their innovative consumer experience. The 2019 FinTech Week The FinTech Anti-epidemic drew more than 12,000 attendees, up about 50 percent Scheme for Talent Development from the previous year, and attracted over (FAST Scheme) is now open for 150 exhibitors and 18 trade delegations. application to support the development of FinTech in Hong Kong. Cyberport is For more details about Hong Kong FinTech appointed to administer the Scheme, which Week 2020, please visit fintechweek.hk is open for online application via the dedicated website (fast.cyberport.hk) from 2 July 2020 to 2 July 2021. Details of the eligibility Contact us now: criteria, application procedures and supporting documents required King Leung are available at the website. Head of FinTech (852) 3107 1016 Z m kingleung@investhk.gov.hk International Forward Calendar 3

JUL

MarineTech 2020 Money20/20 Shipping industry stakeholders will join the forum to network, Europe’s biggest FinTech event, it is where industry leaders discuss and debate market developments and industry trends. come to seize new business opportunities, strengthen This year, the event will explore across the implications of partnerships and discover the latest disruptions. 11 digitalisation. Jointly organised by the shipping industry and 22-24 the internet community in Mainland China. Location: RAI, Europaplein 2-22, 1078 GZ Amsterdam Location: Shanghai Organiser: Ascential Group (Europe) Ltd The Prow, 1 Wilder Walk London W1BAP. Organisers: MarineX, Beyond Shipping europe.money2020.com www.ship.sh/news_detail.php?nid=39417 Marine Money UN Climate Week New York Innovate Textile & Apparel (ITA) Americas The annual event organised during the Climate Week NYC An annual event that brings together strategic decision-makers provides a forum for the shipping industry stakeholders determined to implement digitalisation in the textile and across the region to network, discuss and debate climate apparel sector. 23 actions and industry trends. 21 Location: Boston, United States Location: The Yale Club, New York Organiser: World Textile Information Network (WTiN) Organiser: Marine Money events.wtin.com/event/d97dc83a-b208-4c5b-bf71- www.marinemoney.com/forum/NYCUN20 7b53a4e7bee1/summary HKIB Annual Banking Conference AUG Under the theme “Innovation and Transformation: A Brave New World of Banking”, the conference will offer a platform for industry leaders to explore new frontiers of smart banking The 19th China Private Equity Summit 2020 28 and delve into the issues that are reshaping the banking Recognised as a leading practitioners’ conference, this industry. virtual summit features in-depth discussions on the latest Location: Hong Kong Convention and Exhibition Centre 28 developments and trends in the private equity market in Mainland China. Organiser: The Hong Kong Institute of Bankers Organiser: Hong Kong Venture Capital and Private Equity Association bankingconference.hkib.org/hkib2020 cpes.hkvca.com.hk Airfinance Journal China Conference 2020 The two-day conference will give audience an opportunity to SEP gain market updates, connect with over 500 industry elites and identify business opportunities in the Chinese aviation 29-30 market. ReThink Sustainability Location: Shanghai The event focuses on answering one of the most crucial questions for companies in our city: how to help businesses Organiser: AirFinance Journal in Hong Kong accelerate change towards a more sustainable www.euromoneyseminars.com/china-airfinance/agenda.html 2-3 future. Location: K11 ATELIER King’s Road, Hong Kong Asia Pacific Maritime (APM) 2020 Organiser: EnviroEvents HK Limited A three-day premier exhibition and industry-led conference rethink-event.com/ in Asia showcasing an overview of the vessel sectors including services and solutions, technology, vessels 30 equipment, machineries, supplies, etc. The event anticipates 13th Hong Kong Ship Finance Forum 15,000+ visitors, 1,500+ exhibitors and 18 official pavilions. This annual event provides a forum for shipping and shipping Location: Marina Bay Sands, Singapore finance-related companies across the region to network, discuss and debate market developments and industry Organiser: Reed Exhibitions 3 trends. www.apmaritime.com/en-gb.html Location: Renaissance Harbour View Hotel, Hong Kong Organiser: Marine Money OCT www.marinemoney.com/forum/HK20 TNW – The Next Web 2020 The Art Business Conference TNW Conference is a technology festival that brings together Leading experts from the art world, together with business international technology executives, top-tier investors and leaders and technology experts, will share their insights in promising startups for two days of business and knowledge 9 today’s art market. 1-2 sharing. Location: Church House Conference Centre, London Location: NDSM, NDSM-Plein 28, 1033 WB Amsterdam Organiser: Art Market Minds Ltd Organiser: The Next Web www.theartbusinessconference.com/the-event thenextweb.com/conference See more events at

Visit investhk.gov.hk for details 4 Special Feature Business support measures amid economic challenges

The COVID-19 pandemic has a huge impact on global economies, The Government has pledged around $287.5 billion, about including Hong Kong. To assist enterprises to cope with the 10 percent of GDP, to help offset the economic fallout from pressure brought about by the economic downturn and alleviate COVID-19, including the $120 billion relief package in the 2020-21 their burden, the Government has announced various measures to Budget, the first round of $30 billion Anti-epidemic Fund and support enterprises and safeguard jobs. $137.5 billion relief package announced on 8 April.

Support for business in 2020-21 Budget

• Reducing profits tax for 2019-20 by 100 percent, subject • Providing a subsidy to each eligible, non-domestic to a ceiling of $20,000 household account for four extra months to cover 75 percent of their monthly billed electricity charges, • Waiving rates for non-domestic properties for four quarters subject to a monthly cap of $5,000 per account in 2020-21, subject to a ceiling of $5,000 per quarter in the first two quarters and $1,500 per quarter in the remaining • Waiving 75 percent of water and sewage charges payable two quarters by non-domestic households for four extra months, subject to a monthly cap of $20,000 and $12,500, respectively, • Waiving business registration fees for 2020-21 per household • Waiving registration fees for all annual returns charged by the Companies Registry for two years

The one-off proposals in the Budget also include a $10,000 cash payout to Hong Kong permanent residents aged 18 or over, with a view to stimulating the local economy by encouraging local consumption.

Anti-epidemic Fund

In February, the Government announced the establishment of a $30 billion Anti-epidemic Fund to ease the burden on businesses and the community during the fight against COVID-19. Key initiatives include:

• One-off subsidy of $80,000 to each licensed travel agent • Setting aside $3.23 billion to provide comprehensive and continuous financial support to the various transport trades • One-off subsidy of $200,000 to each eligible licensed restaurant and factory canteen • Setting aside $1.02 billion to support the convention and exhibition industry by providing subsidies to participants • One-off subsidy of to each eligible licensed light $80,000 and organisers of major conventions and exhibitions refreshment restaurant, food factory, bakery, fresh provision shop, and siu mei and lo mei shop • Allocating $150 million to support the arts and culture sector by providing subsidies to arts and cultural groups • One-off subsidy of $5,000 to each eligible licensed hawker • Setting aside $380 million to provide a six-month rental • A subsidy of up to to each licensed guesthouse $80,000 waiver for tenants and startups at Hong Kong Science Park, • Setting aside $5.6 billion to provide a one-off subsidy to Cyberport and industrial estates to support the innovation each eligible retailer and technology sector Special Feature 5

$137.5 billion relief package to support businesses and preserve jobs

In April, the Government announced a package of economic relief measures worth $137.5 billion to help individuals and industries affected by the COVID-19 outbreak. Key initiatives include:

• $80 billion Employment Support Scheme under which • Enhancing the Small and Medium Enterprise (SME) Financing wage subsidies will be provided to eligible employers, capped Guarantee Scheme – additional expenditure of around at $9,000 per month (i.e. 50 percent of median monthly $11.69 billion and additional guarantee commitment of wage in Q2 2019 of $18,000) per employee for six months $30 billion

• $21 billion to provide 16 types of support for specific sectors, including catering, education, transport, tourism, construction, etc.

Co-ordinated support from banking industry

In February, the Hong Kong Monetary Authority and local banks launched the following support strategies to assist SMEs, including:

• Continue to offer to delay repayments or extend loan • Banks say they will allow SME customers in the import-export tenors, and to reduce fees to reduce the cash flow pressures and manufacturing sectors facing cash flow pressure due to facing SMEs. Some banks also provide unsecured loan delays in shipments to further extend the repayment period products for SMEs to help improve their cash flow and have of trade financing facilities. They will also consider allowing made special arrangements to expedite loan approvals more customers to apply to convert trade financing lines into temporary overdraft facilities so that customers can manage • For the import and export sector, banks have extended their cash flow more flexibly the repayment period of trade financing facilities to align with the prolonged trade cycle and allowed customers to convert trade financing lines into temporary overdraft facilities

• Introducing a series of measures aimed at increasing the banking sector’s liquidity and encouraging banks to deploy their liquidity buffers more flexibly to support lending and other business activities

• Reducing the current level of regulatory reserves by half to release a total of $200 billion of lending capacity, providing banks with more room on their balance sheets to cater for future financing needs

• Asking banks to consider arrangements to automatically offer extensions of loan tenor or principal repayment holidays to qualified SMEs without requiring them to make an application 6 SpecialSector Focus Feature

Hong Kong: A Leading Hub for Family Offices

In the last decade or so, there is a strong Stock Connect more than doubled while access to around 40 percent of the PE deal growth in Asia Pacific high-net-worth- their trading of Mainland bonds through flows in Asia Pacific. individuals (HNWIs) population. The Bond Connect tripled. Growth momentum number of HNWIs increased from 3.3 million continues this year. In the first five months Regional philanthropy and in 2010 to 6.1 million in 2018 and the financial of 2020, average daily turnover of Mainland sustainable finance centre wealth has increased from USD10.8 trillion to stocks and bonds through Stock Connect The HKSAR government is supportive of the USD20.6 trillion. This has contributed to an and Bond Connect further increased by over financial industry’s vision to further cement acceleration in the establishment of family 60 percent and 200 percent respectively Hong Kong’s position as a green finance hub offices in the region. compared to the same period last year. in the Asia Pacific region. To support such Hong Kong is already the largest Family offices seeking investment and initiative, the government has launched cross-border private wealth management business opportunities will benefit from the Pilot Bond Grant Scheme, the Green (PWM) hub in Asia and the second largest establishing a presence in Hong Kong Bond Grant Scheme and the HKD100 billion in the world. Both single and multi-family which offers easy and convenient access Government Green Bond Programme offices can leverage Hong Kong’s unique to the Guangdong-Hong Kong-Macao to support green finance development advantage of being the dominant gateway Greater Bay Area (GBA). The number of in the city. Also, the city has a mature between Mainland China and the rest of the unicorns in the GBA is growing, and the and extensive network for philanthropy world and tap on the tremendous asset and valuation of unicorns in GBA increased from activities. Hong Kong tops in Asia in terms of wealth management opportunities. RMB335 billion in 2017 to RMB614 billion in philanthropic asset as a percentage of GDP Q3 2019. Under the GBA, Hong Kong is also and tax exemption is available for charitable Unique access to working with Mainland China to explore the institutions and trusts. Mainland China investment establishment of the “Wealth Management To learn more about the advantages and and business opportunities Connect” scheme, which will allow two-way market opportunities that Hong Kong offers, Hong Kong accounts for the largest access of a wider spectrum of wealth please visit the newly launched dedicated inbound and outbound direct investment management products in both jurisdictions. family offices website familyoffices.hk. of Mainland China. In terms of portfolio InvestHK has a dedicated team to provide investments, since the introduction of the Unparalleled access to ample one-stop services to support foreign and Qualified Foreign Institutional Investors PE investment opportunities in Mainland investors to set up their family scheme in 2002, Hong Kong has worked Asia Pacific offices in Hong Kong. closely with Mainland China in developing Being Asia’s number 1 hub for international new channels, including Shanghai-HK Stock fund management, Hong Kong is Asia’s Connect, Shenzhen-HK Stock Connect, Bond second largest private equity (PE) market Connect and Mutual Recognition of Funds, after Mainland China. As at the end of 2019, Contact: to facilitate cross-border investment flows. approximately 520 PE firms operating in Dixon Wong International investors have been increasing Hong Kong managed about HKD1.21 trillion Head of Financial Services their participation in the China market of capital, including 15 of the top 20 global (852) 3107 1085 Z through Hong Kong. In 2019, international PE managers. Family offices can utilise Hong m [email protected] investors’ trading of Mainland stocks through Kong as a springboard to gain unparalleled Case Study 7

Japanese Retail Giant Shares Tips to International Success Hong Kong hosts one of the stores that have recorded the best sales figures among all Don Quijote locations around the world.

Hong Kong is a beacon for Japanese manufacturers, and we regard the city to be a considerable facilitator of new investments or ventures from Japan.

Mitsuyoshi Takeuchi President & Director Pan Pacific Retail Management (Hong Kong) Co., Ltd.

Pan Pacific Retail Management (Hong market demand. “Hong Kong is the largest stores in Hong Kong, we received dedicated Kong) Co., Ltd., the subsidiary of Japanese importer of Japanese food in the world; its assistance from InvestHK thanks to their discount retail chain Don Quijote’s operating zero tariff and free port status also makes it extensive experience and knowledge. I still company Pan Pacific International Holdings a great location as a distribution hub. “Hong remember InvestHK’s assistance in visa Corporation, opened the first Hong Kong Kong consumers are knowledgeable and application, as well as the abundance of DON DON DONKI store in 2019. Having informed about Japanese products. In other support, care and useful tips provided, for achieved tremendous success, the chain words, Hong Kong is a beacon for Japanese which we are sincerely grateful.” unveiled its much-bigger second store in manufacturers. We regard the city to be a the same year, spanning across over 27,000 considerable facilitator of new investments or square feet in Tsuen Wan. The second store ventures from Japan.” houses over 15,000 types of products, from Pan Pacific Retail fresh and packaged food, to home products, DON DON DONKI employs a large number cosmetics, toys and pet products, plus a dine- of staff members in Hong Kong and most of Management (Hong Kong) in food court with palate-pleasing menus. them are local hires. Takeuchi said that its Co., Ltd. / Pan Pacific Mitsuyoshi Takeuchi, President and Director local employees are key pillars in its operation of Pan Pacific Retail Management (Hong and strategy planning. “Localisation is our International Holdings Kong) Co., Ltd., said that the Hong Kong stores key to success. Whilst there are Japanese staff Corporation (PPIH) are among the best performing outlets based here, it is our management style to give  in the Don Quijote network worldwide, full authority to our local employees, allowing PPIH group operates over showing strong consumption power of the them to make important decisions and take 600 stores including 12 Hong Kong domestic retail market. the lead in developing our store concept and DON DON DONKI stores “We have received very positive responses store management. That is what we call the in Thailand, Singapore and and great support from Hong Kong art of delegating authority – giving authority Hong Kong consumers. Our first store in Tsim Sha Tsui is to the frontline staff. We believe this is the popular among office workers, whereas in our secret of our success.”  Two Hong Kong DON DON second store in Tsuen Wan are frequented He also mentioned that he appreciates the DONKI stores were opened in by families living in the neighbourhood,” said 2019, and the third store was Takeuchi, adding that Japanese Wagyu beef, Hong Kong staff’s strong work ethics and tuna, salmon and cosmetics are especially proactivity in using their own initiative to opened in July 2020 popular among Hong Kong consumers. produce brilliant outcome on a variety of matters. This is one of the strong advantages w dondondonki.com/hk An excellent base for overseas when opening stores or launching new expansion types of businesses in Hong Kong. There are more reasons to DON DON DONKI’s Takeuchi also appreciates the support rapid expansion in the city besides the from InvestHK. “When we opened new 8 Case Study Advancing Global Health Through Collaboration Hong Kong serves as a Roche R&D incubator for bringing innovation to the worldwide healthcare system at large.

Hong Kong has positive influence on the global level. Research investments are made here, and once these are proven effective, they can increase patient benefit elsewhere around the world.

Daniel Thurley General Manager – Hong Kong and Macau Roche

A global pioneer in healthcare and innovation, (HKAPI) to explore ways to better track Hospital Authority, as well as the data that Roche established its presence in Hong medicines with blockchain technology. Roche has, to help patients in Hong Kong. Kong back in 1971. Over the last 49 years, “We are keen to bring innovation forward Thurley thinks that InvestHK plays a key Roche Hong Kong has maintained its status faster than ever before through these role in facilitating Roche’s collaborative as a leading pharmaceutical company in collaborations with Hong Kong healthcare projects in Hong Kong. “InvestHK supports the region. With the combined strengths stakeholders, including the government, us to make connections with people and of pharmaceuticals and diagnostics under the Hospital Authority, universities, startups organisation at the right time and at the one roof, Roche has brought hundreds of right place. They have also supported us medicines and formulations to Hong Kong, and so on,” Thurley remarked. in terms of having more opportunities benefiting patients locally and globally. Local research, global impact around the new patent law launched in “From the very beginning, we wanted to do December 2019,” he concluded. Thurley believes that Hong Kong holds a now what patients need next. Our vision special role for pharmaceutical research is to deliver better outcomes for more and development that can benefit the patients, faster,” said Daniel Thurley, General whole world. “Hong Kong has the capacity Roche Manager – Hong Kong and Macau at Roche. to generate huge insight and become “Our 10-year ambition is to deliver three to  Roche was founded in 1896 a trusted place to work with data and five times more medical benefit to patients discover medicines faster.” and headquartered in Basel, at half the healthcare cost of the society. Switzerland This can be achieved through prevention, According to Thurley, in R&D of new cures and personalised healthcare to molecules, data generated here is shared  Its Hong Kong office houses ensure the right medicines are given to the with Roche’s global office. “Hong Kong has over 120 staff members right person at the right time.” positive influence on the global level,” he with functions ranging from said. “Research investments are made here, A recent example is Roche’s support to and once these are proven effective, they finance, human resources, launch HealthMatch in Hong Kong, an can increase patient benefit elsewhere research & development, Australian-based HealthTech startup around the world.” specialising in clinical trial matching. marketing, as well as a large HealthMatch launched a free Global With a growing number of global and medical team COVID‑19 clinical trial tracker earlier this regional roles following a strategic  With the majority of its year, which is publicly accessible and transformation to enhance agility, designed to inform researchers and general Roche Hong Kong has recently expanded workforce investment going public about the latest development and and relocated their office to a premise toward R&D, Roche is looking progress in global clinical trials, covering in Kowloon Bay, which has been to launch 11 new molecules in not just Roche medicines but also other WELL‑certified. The company has also the next three years pharmaceutical companies. The company newly hired a real-world data scientist in is also running a project with the Hong Kong Hong Kong. They will offer to help expand w roche.com.hk Association of the Pharmaceutical Industry the value of existing data owned by the Case Study 9 A Go-To Legal Adviser for Life Sciences and Technology Leaders For the past century, US law firm Cooley has counselled the world’s leading technology and life science companies and their financial backers.

Every growing business could use some advising some of the region’s most dynamic help from adept counsellors for financing, tech and life sciences companies on their expansion, protection and peace of mind. financing, joint venture and other strategic When the nature of the business is in transactions for some time. It was a natural the realm of innovation and technology, extension to open an office there.” a reputable law firm with a proven Cai added, “Our Hong Kong and Singapore track record is paramount. California- office launches build on our very headquartered Cooley’s core client base well‑established presence in Mainland includes the world’s leading life sciences China, where we have helped more than and technology companies, from startups 80 fund managers form over 100 Chinese to global giants, along with the investors venture capital and private equity funds.” and financial institutions that support them. The firm shares its clients’ passion for Since Cooley opened in Hong Kong, it has innovation, excellence and collaboration, advised several local companies on floating and it helps transformational companies to on international stock exchanges, including biotech company Legend Biotech, the prosper and benefit society at large. autonomous aerial vehicle technology company EHang Holdings and the real Hong Kong – a tech and life estate online platform Fangdd. sciences hub “Hong Kong’s culture and infrastructure In Asia, Cooley has offices in Singapore, make it a focal point for some of Asia’s most Beijing, Shanghai and Hong Kong. Its exciting startups and emerging companies, “With our global clientele and cross-border Shanghai and Beijing offices opened in 2011 and we expect that to continue,” Cai stated. deals, our ability to work very closely across and 2018 respectively, and focus on fund “Alongside our affiliated Hong Kong firm, different geographical boundaries is core to formation in venture capital and private Cooley has four partners, seven associates Cooley’s DNA.” equity. Cooley launched its Hong Kong and other professional staff, as well as a premises in 2019, following a new listing team that supports us and our other offices Going forward, Cooley is planning to build rule for pre-revenue biotech companies in Asia.” upon its prowess through consolidating its introduced by the Hong Kong Stock position in Asia as the law firm of choice Exchange in 2018, and opened in Singapore Strong team spirit for technology and life science companies. in January 2020. Cai feels that the Hong Kong office’s “We will be focusing on startups, venture “We felt that the time was ripe for us to open strength draws from its strong relationship capital, private investment funds, financial in Hong Kong,” explained Will Cai, Hong with colleagues from all over the world. services, M&A, private equity, capital Kong-based partner and head of Cooley’s “Close collaboration across our 16 offices markets and intellectual property,” Cai said. Asia capital markets practice. “Given Hong throughout Asia, the US and Europe is Kong’s pre-eminence as a global business fundamental to our success and greatly and financial hub, we had already been valued by our clients,” he explained. Cooley LLP

 Established a century ago in San Francisco, Cooley LLP Hong Kong’s culture and infrastructure is an international law firm make it a focal point for some of Asia’s most with 16 offices and more than 1,100 lawyers across the globe

exciting startups and emerging companies,  Cooley is known as an elite and we expect that to continue. firm for technology and life sciences companies and the investors and financial Will Cai institutions that work Partner and Head of Asia Capital Markets Practice with them Cooley LLP w cooley.com 10 Case Study Unleashing InsurTech Potential in New Markets InsurTech startup OneDegree strives to redefine insurance service standard with technology.

OneDegree is among the first batch of “We are at the start of InsurTech era and Hong Kong. “Currently we have over 40 staff virtual insurer authorised by Insurance we are excited to be at this juncture. members with strong FinTech background, Authority (IA) in Hong Kong. With its Having a strong tech background, we focus including risk management expertise,” proprietary digital platform, customers on harnessing technology to transform Kwock said, “our team comes from around can browse and buy insurance products insurance and delivery the best value to the world, and we are happy to be able without going through an agent. They can our customers, with an aim to level up the to find top-notch talent. Hong Kong is a also file claims and get customer support industry,” he added. cultural melting pot that gathers a world online. “Our mission is to set new standard class workforce, a lot of people are very According to Kwock, while pet insurance for insurance industry,” said Alvin Kwock, eager to work and live here.” is its first product launched to the market, Co-founder and Group CEO of OneDegree. OneDegree appreciates the government’s “Insurance claiming often takes weeks OneDegree is keen to develop products to support in tech sector. Backed by or even months to complete, but we are cater both B2C and B2B markets, including Cyberport Macro Fund, the startup was working on shortening the claiming time. health and medical insurance, as well as also introduced to investors via InvestHK. We hope to offer a seamless, hassle-free products that focuses on cybersecurity “We are grateful for the support by the experience to our customers while keeping for SMEs. Demand induced from digital department; not only did they help us to up with the highly digital world.” economy such as eCommerce or online food ordering services has also successfully channel major investment, we A guarantee of confidence offered new opportunities. “It is still a can also leverage its extensive worldwide fragmented market, but we are working on network of connections,” Kwock concluded. “Hong Kong is well regarded as an addressing protection gaps and designing international financial centre, getting a products well-suited for the market,” virtual insurer license here has given us Kwock remarked. a high credential as a reliable operator. OneDegree When we obtained the license, several insurance companies around the globe Top-notch global FinTech talent  Founded in 2016 and have immediately contacted us for Talent is one of the major pull factors for headquartered in Hong Kong, collaboration,” Kwock recalled. OneDegree to set up its headquarters in OneDegree has offices in Taiwan, Thailand and is planning for expansion in Mainland China

Hong Kong is well regarded as an  The company launched its first international financial centre, getting product of pet insurance on its digital platform in April 2020 a virtual insurer license here has given us  Backed by BitRock Capital, a high credential as a reliable operator. Cyberport Macro Fund, and Cathay Venture, with partners including Munich Re and Alvin Kwock Scor Re for reinsurance Co-founder and Group CEO w onedegree.hk OneDegree Case Study 11 The Design Storyteller Luxury design and architecture magazine Design Anthology expands beyond Hong Kong and sets up a new agency to help clients develop branded content strategy.

The city is strategically situated within the region, and in fact the world, which allows creative talent access to everything that Hong Kong, Mainland China and the rest of Asia have to offer.

Suzy Annetta Editor-in-chief Fifth Black

Editor-in-Chief. “As we work regularly with many benefits to being based here. I’ve also property developers, our expansion into found the community here is tight knit. (Photo by Jeremy Smart) branding and identity design offers another Creatives are supportive of each other and communication vehicle tailored to those very social.” Founded in 2013 by Suzy and Phil Annetta, clients that complements our established Suzy said that InvestHK’s support has been Design Anthology is a Hong Kong-based print, digital and multimedia offerings.” very helpful in various ways. She concluded, publication focusing on interiors, product “InvestHK has been helpful so far in helping design, architecture and urban living across Easy access to Asia market to get the word out about our company and the Asia Pacific region. With the founders’ for creative industries has advised us about potential grants and backgrounds in publishing and interior Originally from Melbourne, Suzy feels funding schemes in the past which we are design, the magazine is one-of-a-kind in its that Hong Kong is the right place to be for very grateful for.” curation and attention to detail. Recently, Fifth Black, with its clientele ranging from the quarterly has expanded out of Asia property developers and hotels to luxury and launched a UK/Europe edition in 2018, retailers. As Hong Kong is currently the as well as an Australia edition in 2019. The company’s head office where most of its Fifth Black publication is also available digitally via staff is based, editing, quality control and platforms such as Zinio and PressReader, design are all done from this office. With a  Design Anthology and Fifth as well as providing regular content on its growing market demand, the company also Black were founded in 2013 website and through a new podcast series. plans to provide more services and grow and 2016 respectively Using their strength in crafting design- its team in the city. “We hope to continue focused content, the founders set up to work with the best in the industry and  Design Anthology magazine content agency Fifth Black in 2016 to expand our presence regionally. Hong is published quarterly in Asia help brands create custom content. The Kong is unique in the world being small and the UK, and biannually in company is growing continually and and compact but at the same time big and Australia starting from 2019 now incorporates a branding identity international. It’s fast-paced, dynamic and and strategy service, offering a one-stop full of opportunities,” she said.  While Hong Kong remains solution for clients looking to engage with “The city is strategically situated within the company’s headquarters, savvy urban dwellers. the region, and in fact the world, which the company set up a new “Design is at the centre of everything we do, allows creative talent access to everything office in Melbourne in 2019 to and while we create and publish content that Hong Kong, Mainland China and the support the new publication about multiple subjects — such as art, food, rest of Asia have to offer,” she added. “We in Australia fashion, travel and luxury lifestyle-related have access to great quality and well- topics — design and architecture are our priced printing and shipping, and access w fifth.black core passions,” said Suzy, Fifth Black’s to factories in Mainland China. Depending Creative Director and Design Anthology’s on what creative sector you’re in, there are 12 Case Study Marine Eco Guardian Cleanship helps ship owners and operators achieve a cleaner marine environment.

Reducing environmental impact is one of possible only because we are in Hong Kong when we first came here, and participated the many challenges that ship owners face, working in the same time zone with the in many industry events, which have given as shipping regulations are often stringent shipyards in Mainland. If there is any big us great access and expanded our contacts and changing extensively. Cleanship is a issue, I can jump on a flight and be in the tremendously with the marine industry Glasgow-based company specialising in shipyard the next day,” he said. in Hong Kong,” Breakey said. “The city provision of industry compliance services has a large and tight knit community and and technology for projects such as ballast everyone seems very welcoming to see our water treatment, scrubbers and inventory presence here.” of hazardous materials, assisting ship As the business is scaling up, Cleanship owners and operators to improve maritime is looking to hire more engineering roles environment impact. Hong Kong is a vibrant in Hong Kong, targeting local graduates in “Our expertise is in marine engineering and good shipping structural engineer, mechanical engineer, and design. We aided many ships to civil engineer as well as electrical engineer. design exhaust gas cleaning scrubbers, market plus a great Breakey finds the experience of setting we also have ballast water treatment supporting community. up a company in Hong Kong smooth and system – a technical process to remove simple. “The support we have had was micro-organisms in ballast water before We think that it is a phenomenal. Once you are ready to open disposal to reduce marine pollution – being a business in Hong Kong, the support is designed and installed on two of our natural progression there every step of the way. InvestHK has own ships specifically for this purpose,” been assisting us to set up, to market our explained Dave Breakey, Design Engineer of to expand into Asia service, as well as to expand our network, Cleanship. “We are not biased towards any through Hong Kong and which is very helpful to our growth here,” system or technology; we only do what’s Breakey concluded. best for the ship owner clients.” this is an ideal place Proximity to Mainland China to come and begin with vibrant shipping industry the expansion. Cleanship Cleanship have projects in various shipyards across Mainland China, including  Established in 2017 and Shanghai, Nantong and Chengxi. When it Dave Breakey headquartered in Glasgow comes to setting up a business hub in Asia, Design Engineer  Cleanship knew that Hong Kong was the Has eight employees in Hong obvious choice. “Hong Kong is a vibrant Cleanship Kong and Mainland China and good shipping market plus a great including design engineer, supporting community. We think that it is project manager and site a natural progression to expand into Asia A tight knit maritime supervisors. Planned to through Hong Kong and this is an ideal community expand the engineering team place to come and begin the expansion.” Soon after Cleanship setting up its by end of 2020 Being in Hong Kong has also facilitated Hong Kong office in 2019, the company cleanship.co Cleanship to supervise the job in Mainland immediately joined the Hong Kong Ship w China closely. “Overseeing the project by Owners Association. “We have already met a design engineer like myself has become a lot of business partners in the community Case Study 13 Keeping Business Rolling Popular conveyor belt sushi chain Sushiro seeks continual expansion in Hong Kong and Asia following opening of four outlets in the city.

With over 35 years of experience, Sushiro sushi is extremely popular in Hong Kong, our maximum capacity in our current transformed from a traditional sushi shop we also realise that Hong Kong consumers outlets, and we are looking to open more in Osaka to one of the leading Kaitenzushi are very willing to spend on high quality shops in the city,” he revealed. “We hope to (conveyor belt sushi) restaurants in 1984 food. That’s why this place is a top choice keep up with this momentum, establish a with over 550 branches in Japan. Famous for our expansion.” strong sushi brand in the market, and grow for its budget-friendly sushi with fresh steadily in Hong Kong. Our target is to open ingredients directly imported from Japan, High quality consumer base and four to six outlets per year here for the next Sushiro began its overseas expansion five years.” in 2011, and currently operates close sophisticated logistics hub to 40 outlets out of its home country, Aratani has also noticed that Hong Kong Sushiro currently employs 13 back including Korea, Taiwan and Singapore. market is highly sensitive to dining office staff in Hong Kong with around trends, and such market characteristic is 440 frontline employees. Aratani is impressed with the talent quality here: High population creates beneficial for Sushiro. In order to attract “we never had hiring problem in Hong Kong. opportunity for F&B and retain customers, Sushiro offers new The talent is of high quality with great work Sushiro arrived Hong Kong in 2019 and or limited edition dishes on a monthly ethics and professionalism, and I am very shortly within one year, the chain has basis in addition to its extensive regular satisfied with their performance.” expanded to four outlets in the city. menu with over 80 items. “Moreover, Hong Kazuo Aratani, President of Sushiro Hong Kong’s low tax and excellent logistics has Aratani is also happy with the support Kong, said that the city has offered a huge made food import very convenient. We from InvestHK. “When we were starting out, market opportunity for Sushiro. “When we can easily import fresh ingredient from InvestHK has offered great help to connect were looking for a place for expansion, we our headquarters and maintain the same us with different service providers. Their would pick regions that share the common authentic taste from Japan,” he added. services have been very useful for business rice culture with Japan,” Aratani said. owners from helping us to understand “Therefore, we come to Hong Kong.” According to Aratani, Sushiro’s sales in the local market and culture, to providing He added, “the city is densely populated Hong Kong is relatively high among other market information and expanding our with a high eating out frequency. While overseas shops. “We have already reached network,” Aratani concluded.

Sushiro Hong Kong

Hong Kong’s low tax and excellent logistics  Founded in 1984 and has over has made food import very convenient. 550 dining outlets in Japan We can easily import fresh ingredient from  Currently has four shops in Hong Kong located in Jordan, our headquarters and maintain the same Whampoa, Lai Chi Kok and authentic taste from Japan. Wong Tai Sin  Targets to develop business in Thailand Kazuo Aratani w sushiroglobalholdings. President com/hongkong Sushiro Hong Kong 14 Case Study Secured Cyber Solutions for SMEs Securli offers businesses peace of mind with multi-layered solutions to combat cyber-attacks.

In today’s increasingly virtual world, cyber- attacks pose higher risk to any company. Yet what to do when a business is an SME without the resources to invest in costly crime prevention? Securli Limited is a subscription based platform to offer SMEs the right products to reduce cost, time and risk, with customised solutions to prevent, detect, resolve and recover. It established its Hong Kong presence in 2005 originally targeting the city’s prestigious hotel groups. Since then, it has expanded from a service provider to an R&D company with a focus on SecOps Automation.

Hong Kong – a natural choice to setup Securli’s regional headquarters For Securli’s CEO Stanley Li, Hong Kong was the natural choice for Securli’s regional Securli’s Hong Kong office houses primarily arriving from the US to operating in the city, headquarters. “Hong Kong has the versatile engineering and business development InvestHK is always the first organisation financial market and dynamic landscape functions, and Li has plans to double its staff we reach out to with any question or for business requirements facing cyber- count in the medium term. “Globally, it is challenge. We are very appreciative of its attacks with enormous financial risks,” he difficult to find expertise in cyber-security, quick response and tremendously useful stated. “Also, the city’s Smart City initiatives so we are bringing in a training programme information to get us through the day.” with 5G, IoT, blockchain and AI create new from our non-profit partner to recruit Hong Kong, too, is a place that Li has grown cyber-security challenges and market traditional IT experts and cross-train them to appreciate: “It has a vibrant character: opportunities.” to manager cyber-security,” Li elaborated. what I refer to as Manhattan on steroids Numerous factors make Hong Kong the to my American friends. It is a wonderful perfect base for Securli’s target markets in Government’s support to place for business because of its intensity the Guangdong-Hong Kong-Macao Greater business for success. Then I discovered Cyberport’s Bay Area. “After two years of evaluation, In 2019, Securli became a Cyberport tranquility and beautiful nature trails, which we selected Hong Kong,” he noted. “The incubatee; this drives the company’s R&D offers a different aspect to the city.” reasons include its government funding direction. “We needed a partner to guide schemes supporting R&D startups; its us with practical experience,” Li explained. taxation and legal structure; and its local “Ultimately, we believe that Cyberport Securli Limited and regional growth opportunities.” He has all the right ingredients to nurture our added that the city’s simple and low tax  journey from incubatee to a successful exit.” Founded in the US, Securli rate plus its respected legal structure Limited offers multiple layers Li has also relied on the support offered for intellectual property and business of integrated cyber-security cemented Securli’s decision. by InvestHK throughout the years, “From managed detection and response solutions for SMEs utilising a subscription model

Hong Kong has the versatile financial  With Hong Kong as its Asia market and dynamic landscape for business Pacific headquarters, Securli requirements facing cyber-attacks with was admitted as a Cyberport incubatee in 2019 and will enormous financial risks. base its upcoming R&D efforts there to research Stanley Li regulation on metadata CEO w securli.com Securli Limited Case Study 15 A Unified Voice for Building Professionals Chartered Association of Building Engineers set up its first overseas office in Hong Kong to further grow its largest member base out of the UK.

Hong Kong’s building professional are often challenged by the lack of space due to the high population, but they have unrivalled skills and ability to come up with world class buildings and infrastructure design to maximise living and working space. They are a truly valuable asset.

Kyran Sze, MH, FCABE Chairman Chartered Association of Building Engineers Hong Kong Chapter

Chartered Association of Building Unrivalled talent pool of a great opportunity for building engineers Engineers (CABE) is an international building engineers to unleash their potential and strengthen in recognised professional body and a providing sound professional services. We global network that gathers and supports Sze thinks that building engineers in Hong also hope to encourage more young people building professionals around the world. Kong are highly competent and experienced. to engage in our industry and sustain the Its members work across the life cycle of “Hong Kong’s building professional are often talent pool. With Hong Kong as a base, we will the building environment specialising challenged by the lack of space due to the strive to put more effort to cover Singapore across a wide range of disciplines, including high population, but they have unrivalled as well as Belt and Road countries and GBA, skills and ability to come up with world architects, surveyors, engineers and radiating our experience in Hong Kong to class buildings and infrastructure design to construction managers. these regions,” Sze concluded. maximise living and working space. They are Founded in 1925 in London as Incorporated a truly valuable asset.” Association of Architects and Surveyors, Hong Kong is CABE’s Asia Pacific CABE expanded to Hong Kong where the Chartered Association headquarters managing its activities in largest group of members outside the UK Singapore, Malaysia, Macao and Mainland of Building Engineers and Ireland reside. The Hong Kong office is China. To support its members’ career also its very first overseas office in its 95 years Hong Kong Chapter growth, the organisation regularly hosts of history. “We have over 1,000 members Continuing Professional Development  CABE was founded as the registered in Hong Kong, which comprises (CPD) events to uphold members’ standard. our biggest membership base outside of the Incorporated Association Moreover, CABE members can access its UK,” said Kyran Sze, Chairman, Hong Kong of Architects and Surveyors extensive worldwide network in the industry Chapter. “While the city has approximately (IAAS) in 1925 in London, and to share experience and exchange ideas. 400,000 people in the building engineering was renamed to Association workforce, there is a huge potential for us to “Besides providing support to our members, of Building Engineers in expand and mature.” we will also continue to build connection 1993 and then the Chartered with government departments, private “Our membership size has grown companies and employees, with an aim Association of Building significantly in the past five years to raise CABE’s reputation in the industry, Engineers in 2014, its with notable increases in student and and connect with allied institutes to create international members, especially in Asia current name synergy and enhance our credibility in the Pacific regions such as Hong Kong, Malaysia field,” Sze said.  It has 8,400 members and Singapore. It is essential for us to set worldwide and around 1,000 up a local office in this important market With the development of Belt and Road to drive membership recruitment, raising Initiative and Guangdong-Hong Kong- members in Hong Kong more awareness of our work locally and Macao Greater Bay Area (GBA), Sze sees a cbuilde.com internationally,” he added. gap that building engineers can fill. “This is w 24/F, Fairmont House 8 Cotton Tree Drive Central, Hong Kong Get Our App Now (852) 3107 1000 Find Us on Social Media InvestHK News & Events [email protected]

The information contained in this publication is for general reference only. While every effort has been made to keep information current and accurate, InvestHK is not liable for any errors in, omissions from, or misstatements or misrepresentations (whether express or implied) concerning any such information, and does not have or accept any liability, obligation and responsibility whatsoever for any loss, destruction or damage (including without limitation consequential loss, destruction or damage) however arising from or in respect of any use or misuse of or reliance on the information. You are responsible for making your own assessment of all information contained in this publication and shall verify such information by making reference and obtaining independent advice before acting upon it. There is no implied endorsement of any material or recommendation of a company or service provider over another.