18 April 2019
Cyberport chief executive Herman Lam says Hong Kong's status as a global financial center makes it an ideal place for fintech startups. Photo: HKEJ
Cyberport chief executive Herman Lam says Hong Kong's status as a global financial center makes it an ideal place for fintech startups. Photo: HKEJ

Cyberport to focus on financial technology startups

Cyberport will focus on the financial technology sector in the next three years to bolster investment and activity in the government-backed technology hub, according to the head of the company that manages the complex.

Herman Lam, chief executive of Hong Kong Cyberport Management Co. Ltd., said Hong Kong’s status as a global financial center makes Cyberport an ideal place for companies involved in the convergence of technology and finance.

Financial technology, or fintech, broadly refers to the application of technology in the financial services sector. This covers companies providing consumer products and services like mobile payment, big data credit assessment tools, and digital currencies such as bitcoin.

In the fintech sector, Cyberport can also support new entrants competing with established players.

“[Hong Kong’s] land price is a [negative] factor, but whether the community itself is attractive is much more important,” Lam told EJ Insight. “Once you start to have a good community [in the fintech sector], more will naturally come and join.”

The fintech sector has been booming in recent years as technology companies enter the financial business. And venture capitalists are very much interested in investing in fintech startups.

Globally, funds invested in the sector have grown from less than US$930 million in 2008 to over US$1.04 billion in October 2014 alone, according to a report jointly released by KPMG Australia, Australasian Wealth Investments Ltd. and Australia’s Financial Services Council.

Lam said Cyberport has been actively headhunting for local technology talents, who could be “hiding” in large banks and government institutions, and help them start their own businesses.

One fintech entrepreneur who has decided to established a company in Hong Kong is Bitspark founder George Harrap, who thinks the city is a good location to seek investment for startups. 

His company is an exchange platform, payment processor and remittance center for digital currencies.

He said he has decided to build his company in Hong Kong, instead of his mother country Australia, because the city provides him with multiple access to major financial institutions while allowing him to expand to mainland China and neighboring countries. He also cited Cyberport’s generous incentives and Hong Kong’s Bitcoin-friendly regulations.

“Hong Kong is a great place as long as you have a good idea and find the person [venture capital investor] in the first place,” Harrap told EJ Insight. The startup is currently seeking a seed funding of US$100,000.

In late 2010, Cyberport unveiled a three-year strategic plan with an initial investment of HK$100 million (US$12.9 million) to nurture talents in information and communications technology. It has extended the plan for three more years with an additional investment of HK$200 million amid positive feedbacks.

The company reported a revenue of HK$458.3 million for the year ended March 2014, up 8.8 percent from a year ago, while operating profit before public mission activities reached HK$139.1 million.

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EJ Insight reporter

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