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Charles Li Launches Venture To Invest In China's Small Firms

The man who designed the landmark program linking exchanges in mainland China and Hong Kong is now offering a new way to invest in the world's second-largest economy.

Hong Kong Exchanges & Clearing Ltd.just eight months after leaving his post as chief executive, Charles Li this week launched a platform called Micro Connect, which will attempt to connect foreign capital to small businesses in China.

But the start-up comes at a turbulent time for foreign investors in China, as Beijing has sent shock waves through markets by cracking down on major tech giants, halting its massive for-profit education sector and continuing to rein in property developers. Markets have wiped out $ 1 trillion.

In an interview on Thursday, Li ignored the growing risks for investors in China, arguing that his new project was actually "on the right side of history."

Investors are now reading more seriously what President Xi Jinping has said in the past for clues as to which direction China is going and where to put the money. Xi has repeatedly called for a larger pivot to support China's real economy, broaden its base and tackle the nation's inequality.

Li's new project, funded out of his own pocket with Gary Zhang, chief executive of Hong Kong-listed Oriental Patron Financial Group, will offer institutional investors a way to make stock-like bets on a small portfolio. businesses and receive a direct share of the revenue.

Confident that the model will be immune from recent waves of regulatory restrictions, Li said the platform was designed to share revenue on a daily basis through a digital control system.


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