Jack Ma-backed start-up fund steps up search for next biotech unicorn from Hong Kong

Alibaba Hong Kong Entrepreneurs Fund, the US$131 million venture capital fund started by Jack Ma, plans to boost investments in Hong Kong’s biotech start-ups that could become the next unicorn, expanding its focus from fintech and artificial intelligence.

“We have come across a lot of good biotech technologies, the question is whether these are ground-breaking ones,” said Cindy Chow Lok Mei-ki, the not-for-profit fund’s executive director. “As biotech is not Alibaba’s core competence, we hope that we can identify some co-investment opportunities with experts in this field.”

Chow said that the fund, started by the former chairman of Alibaba Group Holding to support Hong Kong and Taiwan-based entrepreneurs, has already deployed US$35 million in more than 20 Hong Kong companies since its launch in November 2015, adding that it was open to co-investing with other venture capital funds specialising in biotech. Alibaba owns the South China Morning Post.

The fund has invested in Hong Kong-based Prenetics, which provides genetics testing solutions for cancer screening, and pharmacogenomics, which provides information about how a person’s genetic profile affects their response to drugs. Some of Prenetics’ clients include top insurers such as Prudential, AIA, HSBC Insurance and FWD.

A key direction of the fund, which is run commercially and managed by China and Southeast Asia-focused venture capital manager Gobi Partners, is to support four areas – biotech, fintech, AI and smart city – identified by the city’s government to boost the economy.

Chow said Hong Kong has a pool of talent in AI and fintech, pointing to two unicorns – private companies valued at more than US$1 billion – that it has invested in namely van-hailing app GoGoVan, and WeLab, a virtual bank operator in Hong Kong.