The Significant Investor Visa (SIV) investment immigration program has recently mandated investment into Australian early stage private equity for 10% of their complying investment portfolio, or $500,000 which may rise to $1M in two years’ time, depending on the success of the program.
Many of those looking to migrate to Australia have made their wealth through their own entrepreneurial activities. These are senior executives and business people who have had the courage and foresight of their own local economic reforms and have worked hard to create wealth.
Australian Venture Capital Growth Private Equity Funds (VCPE) provide a structure to tap into Australian innovation and presents an exciting opportunity for addition capital to grow Australian businesses of the future.
What types of investments will be of interest?
In discussing with potential SIV applicants their own business success, funds most likely to be of most interest will be those that are in industries and sectors that are familiar to them, are simple to understand, have high growth potential and could potentially be applied in China.
How will they select the investments?
Chinese investors value the endorsements and recommendations of trusted friends and intermediaries. Many potential investors will be keen to understand the business plans for the underlying companies, and will appreciate access to financial statements and company records for their own due diligence.
Once invested, it will be important to keep investors informed with regular updates. Some may even want to take an active interest in the companies, which can be valuable for opening up markets in China through their connections.
The importance of building relationships
In China the concept of “guanxi” or as we know it “networking”, is an integral part of mixing business with life. Treat investors as respected business friends, ensure they are included in important business and social events and you will expand relationships and build business partners amongst the entrepreneurial community.
This blog has been adapted from an article by Bart Janowski on 16 Thoughts on Dealing with Chinese Angel Investors. To find out more about the Significant Investor Visa program please feel free to contact us.