F&H backs Song brothers’ singing school

The Song twins retired from the stage in the 1990s, and after more than a decade spent composing songs for the likes of Jacky Cheung, Gigi Leung and Sandy Lam, they founded a company that specialises in talent training, entertainment production and music publishing in 2008.

Wise Entertainment, as it is known, just received a first round of funding from Singapore and China-focused private equity group F&H Fund Management in exchange for a 20% equity stake. "At first they thought they didn't need money, but we persuaded them to take it in order to expand into China," F&H CEO Matt Hu tells AVCJ.

Prior to F&H's investment, Wise opened an office in China but had "no idea what to do next," says Hu, who joins the company's board. Under its new investor's guidance, the strategy will be to focus on education and training, launching new schools and collaborating with universities in Beijing and Shanghai to tap the cities' large youth populations. Wise's longest music courses in Singapore cost around S$2,000 ($1,600) but could retail for ten times that amount in China, based on anticipated demand from prospective students in Beijing and Shanghai alone.

F&H had been interested in entering China's pop music training business for some time. Having expressed this ambition to Singapore's Media Development Authority, it was introduced to Wise, which is currently generating revenues of less than S$1 million. Hu is confident that the Chinese arm of Wise will soon be recording sales of S$10 million or more however.

"There is an increasing demand for people to be trained more in the pop area, and this is what China is lacking," he says. "A lot of the students in arts schools in Beijing want to have additional classes after school and this is what Wise can provide."

The Song brothers, Wise's founders, have retained the 80% of equity not acquired by F&H. The funding they received was channeled via the Sing Home Fund, which held a first close on S$120 million in February 2011 and is targeting S$150 million for its final close this year.

For F&H, Wise's value proposition lies in its association with Song and Song. It is now up to the private equity firm to fully leverage this value. "We just needed to find the right team to take the market share," says Hu. "Because of their success and the weight of their name, I think the Songs have the potential to get it. That's why we chose them."

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• Topics
• Expansion
• Southeast Asia
• Greater China
• Consumer
• Media
• Singapore
• China
• Media
• Growth capital
• F&H Fund Management