Wealth management firm BMY Group (BMYG) is on the hunt for offbeat startups following the launch of $50 million fund, with the aim of matching high-net worth Chinese investors with Australian emerging, high growth companies.
The new fund is being set up in response to escalating demand from its client base, who are aiming to take more risk with their portfolio and diversify away from traditional investments in Australia, such as property.
The firm expects to close the full $50 million for the fund by mid-2017, and has currently raised almost $10 million from Chinese high net worths.
“There is a huge misconception in Australia that wealthy Chinese are only interested in buying property,” says co-founder and managing director Eric Gao.
“Young investors want to take on more risk. They are already on the hunt for new business ideas to support and this new fund will simply facilitate this.”
Co-founder and head of investment Julius Wei added: “We want to provide our clients with opportunities already available to Australian investors, as well as give them a more local insight into what they are actually investing in.”
What is BMYG looking to invest in?
For the fund, BMYG is looking for pre-IPO companies in lesser known industries, such as consumer goods or clean tech. The firm is also looking for startups with global aspirations, and in addition to providing funding is eager to coach them on expanding into Asia.
BMYG’s fund is aimed at complementing the booming VC sector rather than placing themselves in direct competition with other firms. The fund launch caps off a booming year for the VC market with firms such as Airtree Ventures, Alchemy Ventures, Rampasand and ReInventure raising funds over $50 million in the past year.
The fund also expands BMYG’s participation in the startup space. The company was involved in several transactions this year including two capital raises with fintech firms AfterPay and OpenMarkets.
This launch will be the first of two funds, with a second focusing on early-stage startups set to be launched next year.