Julie Sinnamon, the chief executive of Enterprise Ireland (EI), said that, after Britain leaves the European Union in March next year, Hong Kong and mainland China will play an increasing role as export markets for Irish companies.
Sinnamon led 45 leading Irish companies backed by EI to take part in Hong Kong FinTech Week and the China International Import Expo in Shanghai. EI is the trade and innovation agency of the Irish government and the world’s third-largest venture capitalist.
“Although the UK has been Ireland’s biggest export destination, Irish exporters have an opportunity to pivot east early. China will play an important role in diversifying Ireland’s export options and reducing our dependence on the UK. This needs to be clearly communicated to Irish businesses,” she said in a written reply to questions.
“Our participation in Hong Kong FinTech Week and the China International Import Expo is key to making those connections,” she added.
At the Hong Kong event, 14 Irish financial technology companies showed their products. Three signed new agreements, including Global Shares, a provider of equity compensation management software. It signed a deal worth US$15 million with Huanying International and announced the opening of an office in Beijing.
“Hong Kong is one of the most forward-looking [cities] in Asia when it comes to fintech,” said Sinnamon. “We very much view it as its own distinct market as well as a gateway to Greater China … It has a strong regulatory environment, strong financial sectors, a network of connections to the mainland market as well as the West and safeguards intellectual property and data protection.
“Hong Kong is a highly influential fintech hub throughout the region and the world and we do not perceive it slowing down. It has a very pragmatic and progressive response in the face of rapid growth of fintech companies in the region, homegrown or from abroad,” she said.
FinTech Week attracted more than 5,000 senior executives and featured over 100 of the world’s top fintech founders, investors, regulators and academics. It drew more than 4,000 attendees from over 50 countries and more than 300 speakers. There were more than 150 one-on-one meetings between entrepreneurs, regulators, incubators, venture capitalists and service providers.
Mo Harvey, EI lead for fintech and financial services for the Asia-Pacific region, said: “We see real opportunity in the areas of [regulatory technology], payments, blockchain and big data and expect a significant increase in the number of Irish companies entering the HK market in the next six to 12 months. There will be particular focus on regtech, cloud and banking companies in order to take part in Hong Kong’s new virtual bank initiatives.”
Sinnamon said more than 150 EI client companies have established offices in mainland China or Hong Kong and over 300 exported to the region. Fifteen fintech and financial services companies have offices in China/Hong Kong SAR. They include FEXCO, Daon, Know Your Customer, CurrencyFair, Intuition Publishing and Financial Risk Solutions. Their customers include HSBC, Standard Chartered, Bank of China, the Securities and Futures Commission and the Jockey Club.
Asked if she thought Hong Kong risked losing fintech business to other cities in Greater China, Sinnamon said that, with the development of Shenzhen, the GBA, Shanghai and other cities, EI regards HK as no less attractive. “We view HK as critical for our portfolio companies to succeed in the region.”
EI has a portfolio of over 200 fintech and financial services companies with a combined revenue of over one billion euros. It is Europe’s biggest fintech investor, investing in over 80 fintech companies in the last five years, including in 23 fintech startups last year.
Sinnamon said EI has undertaken four capital initiatives with the private sector, called the Seed and Venture Capital Scheme.
In May 2013, the most recent such scheme was launched for the 2013-2018 period. Under the scheme, the government approved 175 million euros (US$200.48 million) for investment to support the development of high-growth Irish companies with the potential to grow jobs and generate large amounts of additional exports. The nine funds supported under this scheme have a combined fund size of 700 million euros.
“We invest in companies that will create jobs in Ireland and increase exports from Ireland,” she said. “We recently launched an Overseas Entrepreneurs Fund, so we also invest in entrepreneurs moving to Ireland to start their business or existing businesses relocating to Ireland.”
An applicant must prove that it can create 10 jobs in Ireland and realize one million euros in sales a year within three years of operation. It must have an experienced management team, be legally entitled to set up a business and reside in Ireland, and be headquartered and controlled in Ireland.
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