HSBC launches US$880m technology fund for start-up companies
The GBA+ technology fund will provide senior debt financing to companies that are likely to have received funding from venture capital or private equity firms
HSBC Commercial Banking on June 11 announced the launch of the GBA+ technology fund, which will provide US$880 million of debt financing to high-growth, early stage companies, especially in the Guangdong-Hong Kong-Macau Greater Bay Area. The GBA+ technology fund reflects HSBC’s strategic commitment to helping entrepreneurs and the new economy thrive across the Greater Bay Area.
This dedicated lending facility will support enterprises in sectors such as e-commerce, fintech, robotics, biotechnology and healthcare technology in China, Hong Kong and Macau, pioneering a holistic approach to supporting new economy companies.
In launching the GBA+ technology fund, Terence Chiu, head of commercial banking, Hong Kong at HSBC, notes the closer economic partnership within the Greater Bay Area is set to drive the growth of many of its Hong Kong customers, especially those in new economy sectors. “These companies have different business models to those that we served in the past and the funding ecosystems around them have also evolved,” he says. “The GBA+ technology fund reflects HSBC’s commitment to supporting the next generation of growth companies across the Greater Bay Area and adapting the way we do business to better meet their needs.”
Neo Wang, co-chief executive and head of commercial banking, Guangdong at HSBC, points out the Pearl River Delta is recognized as a global innovation hub. He adds: “The region has the largest amount of hi-tech companies among the provinces of China. At present, over 45,000 hi-tech companies operate in Guangdong, increasing by 37% compared to the same period last year. The launch of the GBA+ technology fund will help us finance innovative companies who are driving the transformation of Guangdong’s economy at a crucial stage in their growth. HSBC stands alongside entrepreneurs and businesses aspiring to be the next unicorn.”
The GBA+ technology fund will provide senior debt financing to companies that are likely to have received funding from venture capital or private equity firms. It aims to provide entrepreneurs that have viable business models with liquidity to finance growth rather than to fund proof of concept work in the earliest stages of a start-up’s journey.
In 2018, HSBC Commercial Banking set up dedicated teams in Guangdong and Hong Kong to support the business ambitions of technology companies in the Greater Bay Area. This investment in technology sector expertise gives HSBC greater insight into innovative business models that helps it understand the unique financial needs of high growth companies.
Customers in innovative sectors such as e-commerce, fintech, robotics, biotechnology and healthcare technology will be eligible for the fund. Apart from funding support, HSBC continues to adapt its offering to meet the full range of banking needs of businesses at each stage of their growth journey, from cross-border cash management and foreign exchange to accessing the private and public capital markets. HSBC will also help to build these companies’ networks by connecting them with peers and industry thought leaders through exclusive events.
HSBC is committed to supporting local entrepreneurs and innovative companies: over 80% of new business accounts opened in Hong Kong are for start-ups that have been incorporated for less than three years. In April, the bank launched the HSBC sprint account, a new business banking proposition dedicated for start-ups and small businesses operating in Hong Kong. The number of technology customers served by HSBC’s commercial banking business in Guangdong’s Pearl River Delta has more than doubled over the past three years.
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