YEAR 2008-2009 IN REVIEW
Chairman Johnny Chan
When I was talking here the same time last year, everything looked seemingly bright and positive. Very few of us (certainly I for one) would have imagined the massive fallout of the financial market and the extent of effect on the economies around the world. The PE industry is not immune to this. Performance has been affected and fund raising became much more difficult, and some came to a halt. Given the severity of the situation, and despite some greenshoots we saw in the stock markets until recently, the recovery may take some time. The effect of that may mean we will see some changes in the ways our industry operates and even greater differentiation of the players.
Governments around the world are making unprecedented moves to re-ignite their economies. In China, as you all know, the government is pointing the way to opportunities in infrastructure, environment, health care, consumer sectors. Indeed, Asia still holds the most promise (and in particular, China) amidst the turmoil and is an area where few can afford not to be engaged.
We see new and global funds setting up in Hong Kong to look into Asia and China and many of them have joined our association for the first time. This bodes well for our industry and for Hong Kong as a base too.
I would like to report on our various activities in the past year:
MEMBERSHIP
At HKVCA we are seeing an increase in membership with the entry of many new funds and global funds in the market. Some join the Association to seek market knowledge, intelligence and the benefit of sharing information in a still uncertain market. It is gratifying to see that another group gaining prominence is the Fund of funds and family offices.
Membership now stands at 173 as compared to 141 last year, an increase of 32 members, this was done in the midst of a financial crisis! If you were to put it in context, our membership increased from 129 in 2006 to what it is today. I take this opportunity to thank our Membership committee for an excellent job done.
Committee members: Johnny Chan, William Kerins, Michael Scown, Boris Bong, Yoshiaki Hasegawa, Alex Mong
EDUCATION
With reorganizations, active funds and personnel movements within the industry, the need of knowledge share and to learn from fellow practitioners experts how to handle difficult situations created by the crisis, we heard the calls for a structured education course on VC/PE.
The Education Committee is commended for starting HKVCA's first Fundamental Education Program in February. It met with such overwhelming response that we had to repeat the course. Total attendance was 115. The instructors were all top PE practitioners who are well heeled with a wealth of experience. It was therefore not surprising that the feedback from participants was excellent.
We thank the Committee here for their work in designing the program, identifying outstanding speakers for a most useful program from which members can derive great insights. We also specially thank the instructors for doing their presentations. Following its success, the committee is working to improve the program as well as to introduce other 'master classes' in the future. It should also be mentioned that the Association had obtained SFC accreditation for its programs which will be useful to members as more are becoming registered under SFC.
Committee members: Johnny Chan, John Levack, Stephen Wozencroft, Adrian Bradbury,
Edward Yum, Victor Huang
CHINA
The China story appears to be the dominant theme in the context of the economic crisis and interests in China is stronger than ever. This makes our China Summit a 'must attend' event. Members look to the Summit, in its 8th year as an essential forum to learn, share and find solutions in their investments in China. Despite our rather subdue projection at the time of planning, Attendance at the China Summit was at a record 270. A great deal of thought and hard work goes into the planning and organizing of the Summit. The China Committee is congratulated for a very successful event.
Besides the conference, the Committee also undertakes other functions in relations building with governmental bodies and associations of various provinces and cities of China and in taking speaker roles and engagements in China. We signed an MOU with the BJ VCA, we attended some of the conferences organized by the Shenzhen VCA and we planned to have more engagement with the CVCA in the many activities we each organize. etc etc. I thank them for contributing their time in promoting HKVCA.
Committee members: Johannes Schoeter, Conrad Tsang, Alvin Ho, Gordon Lam, Petrina Tam,
S C Mak, Vincent Chan, Alice Chow, Robert Xie, Philip Zhai, Peter Chen, Teoh Chin Chin
EXTERNAL RELATIONS
In Hong Kong, our mission is to promote the PE industry as an integral and important asset class on Hong Kong's financial services platform. Our representatives have joined FSTB missions to China, Russia. In addition to dialogues with the FSTB, we have also forged strong ties with HKTDC, HK Stock Exchange, Cyberport, HK Science and Technology Park, the many of the Universities. In the past year we have had close working relationships with other professional bodies such as the Alternative Investment Management Association (AIMA), Association for Sustainable & Responsible Investment in Asia (ASrIA), Chamber of Hong Kong Listed Companies (CHKLC), Hong Kong Institute of Certified Public Accountants (HKICPA). Through several joint events with these associations we provided networking opportunities for members and to work on issues of common interest in promoting Hong Kong as the centre of financial services in Asia. In this area of work we thank in particular Conrad Tsang, K O Chia and Vincent Chan.
Committee members: Johnny Chan, K O Chia, Vincent Chan, Varun Bery, Conrad Tsang,
Hanson Cheah, Jamie Paton
VENTURE (Formerly SME)
Our Venture Committee takes an active role in connecting with the entrepreneurial community. The social mixers of VCs and entrepreneurs draw a large crowd and continue to be a successful formula. The Committee is undertaking an initiative to build an Angel/VC platform and is planning 'meet the entrepreneurs' sessions to help angel investors identify the next great innovation. We recognise and thank them for their work and commitment.
Committee members: Jeffrey Cheung, Marvin Lai, Simon Mak, Patrick Lim, Roger Marshall,
Michael Scown
SOCIAL
Networking amongst members is an essential part of our platform. We introduced for the first time breakfast meeting this year where we would meet new members. The purpose is also to have a regular venue for all members to come together informally. The breakfasts are held usually on the first Monday of the month (except for August when many of us are away) and we welcome all of you to join us. This is also where we would like to obtain feedback and suggestions from you. In addition we continue our tradition of luncheon meeting whenever we have interesting speakers.
All work and no play is not what we are about. Our interest groups - Golf and Wine have a popular following. The Annual Golf Day is into its 6th year, held as usual at Fanling HK Golf Club. Wine lovers look forward to learning something new each year as the committee looks for interesting themes in this continuing education. At this juncture, I would like to thank Varun Berry, Stephen King and team for their continuing interest in Golf, and Marcus Thompson and Monica Tsui in Wine Tasting.
All these were achieved, with your participation, in the midst of an economic crisis!
FUTURE
HK Funds Hub
Going forward in the next year, the Executive Committee will be moving forward with the key initiatives that have been framed. HKVCA is preparing to take the lead in promoting Hong Kong as the Fund Hub Centre and a centre for Fund Raising for Asia. Hong Kong has natural advantages to be a base for Fund raising. As more and more Fund of funds, placement firms establish themselves in HK, family offices becoming increasingly professionally managed, Hong Kong will be able to carve a niche as the centre for sourcing funds in the region. We are proposing that the government can also play a more active role and potentially to initiate the idea of a sovereign fund to encourage this development.
Special Projects
As an essential part of this goal, the industry in Asia needs to develop creditable performance data and transparency in line with that in US and Europe. HKVCA has been working for a number of years in encouraging PE funds to participate in a survey with Thomson Reuters that would help create a accurate information base for Hong Kong and Asia. Thomson Reuter's figures are relied upon by the industry in both US and Europe. Our Committee had spent a great deal of time in working on the format and procedures to ensure utmost confidentiality for participating firms. Developing these figures call for all participants to cooperate in the interest of the industry to which we all belong and they will benefit all funds in the long term. Marcus Thompson has been leading this effort for many years and our heartfelt thanks to him for not giving up!.
With the growing participation of LPs in our association, we plan to set up a new LP sub committee and integrate the performance survey into its mandate.
Committee members: Marcus Thompson, Richard Tan, Markus Ableitinger
Co-operation
Our objective is to build closer links with other venture capital associations in China and Asia. This year we signed an MOU with the Beijing Venture Capital Association and have worked closely with the Taiwan Venture Capital Association as well as China Venture Capital Association. We also co-operated with other associations such as the Alternative Investment Management Association (AIMA), Association for Sustainable & Responsible Investment in Asia (ASrIA), Chamber of Hong Kong Listed Companies (CHKLC), Hong Kong Institute of Certified Public Accountants (HKICPA).
CONCLUSION
In closing, I would like to thank all my fellow Committee members for undertaking leadership of the Association and for the commitment of serious time and effort in working for the interest of the community. You all know how busy and how much travelling everyone has to do in this field. So to take time for our many meetings on the Executive Committee, Subcommittees, plus the many follow-ups, is indeed an extra burden. We owe our appreciation to a most responsible and hard working team. Thank you all again.
I would like to urge all members to participate in our activities. For those who have the interests and can spare their time and hear my calling, please offer yourself to be involved in one of the Sub-Committees. Above all, the association is here to work for you and to serve you and to represent your interests, so your feedback and comments are not just welcome but is necessary and very much encouraged. Thank you very much!
The Hong Kong Securities and Futures Commission (HKSFC) has approved HKVCA as a Recognised Institution for Providing CPT (Continuous Professional Training). HKVCA's training courses, seminars, summits, conferences and forums may be applicable for claiming CPT points. For more details, please refer to "Education" section of our 
