Sinovation sharpens focus on healthcare-plus-AI

Lee (pictured) told the Hong Kong Venture Capital & Private Equity Association’s (HKVCA) Asia Forum that while his firm has backed seven AI unicorns at early stages in the last two years, it will not be able to maintain that same pace of investment in the years to come.

“Investors should be really cautious about claims of AI funds looking at the next big breakthrough,” Lee said. “Technologies are becoming more mainstream – there won't be as many rocket-science projects. I don't believe anyone who claims they can build a whole fund based on AI breakthroughs. If that were possible, we would be doing it.”

He added that the most applicable areas for AI are the internet and financial technology, although both are becoming saturated. Internet AI applications are no longer seen as investable because the major players have sufficient in-house capabilities. The same is true for fintech, although there is still a window opportunity, according to Lee. 

“If you build AI to sell to the internet industry, you won't have any customers because every internet company will have a lot of data, and they will find it absolutely core and necessary to have their own AI and probably not rely on outside technologies,” he said.

Lee said healthcare, including biotechnologies, was currently the biggest opportunity set for AI, noting that Sinovation had added two partners as well as new team members across all funds to cover the space. However, progress is expected to be incremental due to ethics and safety concerns.

“Healthcare-plus-AI, that's where we're betting the most. With AI opening data up plus with advances in genomics that personalize treatment, we are at the beginning of a process that will really leave behind the old ways of doing medicine and treatment,” Lee said.

The comments came after Lei Zhang, founder and CEO of Hillhouse Capital, emphasized the opportunities at the nexus of life sciences and AI-enabled supercomputing at the Asian Financial Forum, describing his firm as “probably the largest investor in healthcare in China.”

China’s domestic biotech space was running hot even before COVID-19 increased enthusiasm for all things healthcare. Approximately $4.1 billion was deployed in the sector last year, almost equal to the prior three years combined. The number of deals has increased steadily, reaching 120 in 2020, twice the 2017 total.

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• Topics
• Greater China
• Technology
• Healthcare
• GPs
• artificial intelligence
• Sinovation Ventures
• China