The former GoPro VP of International Finance holds nothing back in this interview about Hong Kong startup scene
Greg Patti’s journey in Hong Kong began when he moved to the city to start up the international finance operations of GoPro, the US manufacturer of action cameras.
He played a crucial role in opening five international offices for the company, along with the design and management of the company’s strategic processes. Due to his hard work, GoPro was able to book over US$1 billion in revenue within just three years.
After leaving the company a year ago, he founded investment firm Agave Partners, while also serving on the board of directors of US developer of wireless charging solutions for mobile devices Mojo Mobility.
“As we do this interview I am ‘outside’ of Hong Kong exploring a business opportunity. People, taxes, markets, slow to change, traditional approaches, are all chipping away at the reasons for being here and competitiveness,” he said.
“However, there are still a variety of good solid business reasons for coming to Hong Kong,” he concluded.
Despite his busy schedule, he managed to answer e27‘s burning questions about Hong Kong startup scene — and his answers might surprise you.
The following is an edited excerpt of the interview.
This year, the government threw unprecedented financial support into the startup scene. Have you noticed a change in the ecosystem because of this?
I have heard rumblings of money available, been invited to a few pitch sessions, but in general have been told that the money is hard to tap in to.
And its ‘government’, with lots of paperwork, questions, overhead, so better off just finding Angel or traditional VC.
How important is the RISE conference for the Hong Kong startup scene?
I am not really familiar with the conference. However, any initiative that can help to boost startups is always welcomed.
Hong Kong is often considered attractive for being ‘the most purely capitalist economy in the world.’ How does this impact startups? Is it more of a cutthroat industry than say Singapore?
I am not familiar with Singapore scene; spent 20 years in Silicon Valley, been in Hong Kong for five years.
My humble opinion is that there is still some development required of the startup investment activity here in Hong Kong. Standard process for investing, familiar approach to valuation setting, team building, need to be matured.
Does the anti-Mainland sentiment of recent years affect startups? Do you see more investments coming from China, or other markets?
No effect. Recently have seen more China money available, and seems to be a lot of expat activity. Have met with about 15 management teams in the last year, and only about three of them were local grown.
The teams led by expats that I have met with seemed to be more organised, professional, and focussed in their approach to providing a valuable solution to solving a specific need.
Hong Kong would be a natural place for fintech to take off. What kind of companies are you seeing? Are they mostly related to the Hang Seng and private equity? Or are we getting Hong Kong companies in other areas like mobile payments or remittances?
I have only seen a few. They were related to mobile payment, or specifically related to doing business in a multi-currency commercial world. This is still a challenge, and the big guys have not yet solved it.
Do you worry about the future of Hong Kong as a place to do business?
I came here five years ago to set up the business for GoPro. I left the company a year ago.
Since that time, I have watched the bulk of the business processing, engineering and commercial activity move across the border to China and to Europe.
As we do this interview I am ‘outside’ of Hong Kong exploring a business opportunity. People, taxes, markets, slow to change, traditional approaches, are all chipping away at the reasons for being here and competitiveness.
However, there are still a variety of good solid business reasons for coming to Hong Kong.
How do you think being so close to Shenzhen and Guangzhou affects how you operate as an investor? Considering them being two of the most important hardware manufacturing hubs in the world
Both important, and not.
Important because almost every company I invest in, or deal with has something going on over there. Being close allows you to jump across and physically chat on a solution and build a relationship. Having said that, the border is a giant hassle.
Not important, because in the world of Internet, you can pretty much interact from anywhere. I mean, there are people who work down the hall from me, that I hardly ever see, but we do everything via email, phone, video.
So, becoming less of a big deal. Pricing/costs across the border are increasing, and becoming normalised. So that, along with the ‘challenge’ associated with doing business with China, is making the decision to go across more difficult each year.
Image Credit: Greg Patti
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