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2022 June
Treasure Hunting in Hong Kong’s Innovation Ecosystem

Powered by CR Capital Management, Runnovation was founded to look for “unicorns” amongst start-ups. It envisions to establish a venture capital fund in the long run to constantly support high potential local start-ups and industrial innovation.

 

According to InvestHK’s 2021 statistics, there are now 3,755 more start-ups in Hong Kong than there were in 2017, marking a 68.5% jump. These companies are also hiring 118% more employees across various sectors.

 

An accelerator to facilitate Hong Kong-China integration

Runnovation was founded by CR Capital Management in October 2021. Riding on its extensive networks and accelerated channels to access the Mainland market, the company is committed to helping start-ups make the leap from a higher ground. According to Dennis Choi, CR Capital Management General Manager (Investment) and Runnovation Managing Partner, Runnovation is a 10-year long industrial innovation and investment project. The intention to set it up in Hong Kong dates back to 2017.

 

“We sensed very strong government support on innovation and technology last year. COVID has also sped up the sector’s growth and we are witnessing the gradual formation of an ecology. We want to uphold our corporate social responsibilities and Runnovation was launched officially in October 2021.”

 

Choi said that the current rental venue in Wanchai has a dual function. On one hand, it is used for meeting internal and external partners. On the other, it offers a platform, where start-ups lacking the space to showcase their high-tech products and entrepreneurial philosophy can make good use of the space here to be seen and to discuss with others. “Industrial intelligence and resources are always the missing link for start-ups. On top of continuous government support, Runnovation is here to carry on the task as an accelerator.”

 

Choi revealed that their team has now approached a few dozen start-ups. He stressed that the project is still in its early stage and investment return is difficult to estimate in the short term. Yet, they are highly optimistic about future growth.

 

Keen to set up venture capital fund

Choi explained the three main objectives of Runnovation: to join up with the government, the financial sector, the commercial sector and universities to host various seminars and exhibitions, to groom talents and to contribute to the construction of the industrial ecology; to act as a connector between the Hong Kong and Mainland markets; and, through internal and external resources, to help Hong Kong start-ups to launch in the Mainland market, and Mainland companies to set foot in Hong Kong or overseas markets; to establish a venture capital fund to offer constant support to local start-ups with outstanding potentials.

 

He added that Runnovation would also strive to collaborate with internal and external partners and provide appropriate investment and business cooperation, advice, training, and so forth to help start-ups grow further.

 

“Projects that we intend to invest are mostly in line with the six core businesses of the Group, namely big consumption, integrated energy, urban construction and operation, big health, industrial financing, technology and emerging industries. We are open to the possibility of becoming a shareholder of high potential start-ups. In doing so, we would consider how the philosophy of these start-ups align with that of the Group.”

 

Ample market possibilities in the Mainland

Choi reckons that while it may be easier for Hong Kong to tap into the markets of Japan and Southeast Asia, the local market is still quite small and has limited the growth of start-ups and the investment return of venture capitals. It is also not easy to generate an interest to invest from sizeable companies. He encourages Hong Kong start-ups to learn more about the Mainland market, and believes that a strong foothold there will subsequently help catch the attention of more investors.