AVCJ

Weekly digest - November 24 2021

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  • Rana Tang
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24 November 2021
TAIWAN START-UPS: LEAVING THE FACTORY
COVER STORY
An industrials-focused start-up ecosystem has tilted toward consumer in the past year, but the traditional heavyweights are indispensable.
ALKING POINTS
AROUND THE AVCJ FORUM
Energy transition: "It’s not only about renewable energy – It’s also about smart energy, using technology to deliver the energy in a very smart way. Energy transition is going to happen for the next 50 years, I think it’s probably going to be the biggest opportunity for private equity globally" (K.Y. Tang, Affinity Equity Partners)
Climate change: "If you don’t tackle scope-three, then you’re not changing the system, you’re not driving it down through the supply chain, you’re not engaging with your customers, and you’re not taking accountability for the most material proportion of your emissions" (Sophie Walker, EQT)
Sector specialization: "We all know local teams are important. But to build up a very deep sector [specialization] is one of the most important trends in private equity in Asia in the last few years and for the future" (X.D. Yang, The Carlyle Group)
GP-LP alignment:"I am pretty sure something will go wrong at some point, and we will look back and ask, ‘Why did we do that?’ It is important that GPs and LPs are aligned to maximize those returns, especially as we go into more challenging times ahead" (Hideya Sadanaga, Japan Post Bank)
Diversity:"We had one manager come back with zero females in the private equity firm. Unless they put in place a policy to address the fact that they have no gender diversity within their portfolio and within their firm, we are unlikely to invest with them again" (Liza McDonald, Aware Super)
China technology: "In early-stage investments, the valuations are not going down as much. It implies that the market thinks that this is going to be a relatively short-term disruption. They think by the time those early-stage companies get to the IPO stage, the disruption will be smoothed out" (Marcia Ellis, Morrison & Foerster)
Value in consumer: "For us, the biggest counter is to look into the fundamentals of the brands. We like to back brands that maybe would take longer to scale but have a robust business model that can build entry barriers in either supply chain or product or their solid operation of front-end channels" (Michael Zhang, BA Capital)
Extra reading:
ANALYSIS
CHINA IPOs: THE STAR STILL WANES
CHINA IPOs: THE STAR STILL WANESProceeds from private equity-backed offerings on China’s Star Market are down 75% from their peak two years ago, reflecting ongoing regulatory interference and diminished investor confidence.
Q&A
KEY TAKEAWAYS: MARC ROWAN OF APOLLO
KEY TAKEAWAYS: MARC ROWAN OF APOLLOHigh valuations, pursuing complexity, and eradicating write-offs were on the agenda when Marc Rowan, co-founder and CEO of Apollo Global Management, spoke at the AVCJ Forum. Here are some highlights.
DEAL FOCUS
ICON RETAINS ITS PRIVATE EQUITY APPEAL
ICON RETAINS ITS PRIVATE EQUITY APPEALEQT’s $1.67 billion acquisition of Icon Group underscores the recent trend in large-cap buyouts, as well as the long-term growth potential for cancer care specialists in Australia and the wider Asian region.
DEAL FOCUS
ORCHESTRA DELIVERS PIZZA TO SEOUL
ORCHESTRA DELIVERS PIZZA TO SEOULBanolim has become Korea’s fourth-largest pizza delivery business largely on the back of savvy marketing and expansion in lower-tier cities. Orchestra Private Equity is supporting a rollout in Seoul.
DEAL FOCUS
QUIET CONFIDENCE PERSISTS IN HYDROGEN POWER
QUIET CONFIDENCE PERSISTS IN HYDROGEN POWERH3 Dynamics is bringing hydrogen-powered delivery drones to Asia’s crammed megacities as a steppingstone to a cleaner aviation sector. This is a sweet spot for Hong Kong’s Audacy Ventures.
SEEN AND HEARD
TECH TITANS

China is the dominant force in autonomous vehicles and the internet-of-things, while the US remains preeminent in B2B software-as-a-service, according to a ranking of the top 100 growth tech companies by Boston Consulting Group and B Capital Group.

SEEN AND HEARD
GROWTH STORY

Southeast Asia’s internet economy will generate $170 billion in gross merchandise value in 2021 and is on course to reach $1 trillion by 2030, Google, Temasek, and Bain & Company found. The rise of the digital merchant is one of numerous byproducts.
The rest of the week
FUNDS
LIQUIDITY EVENTS
DEALS
For your calendar
UPCOMING EVENTS

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