Tech start-ups opting for ASX listing

Many tech start-ups in Singapore and South-east Asia are turning to the Australian Stock Exchange (ASX) to list, instead of the Singapore Exchange (SGX), or the Hong Kong stock exchange.

A report by Singapore-based venture capital firm Golden Gate Ventures noted that, historically, South-east Asian stock exchanges are "not known for their track record of listing tech start-ups", noting that many turn to ASX instead.

Start-ups interviewed pointed to lower fees associated with listing on ASX, as well as a more savvy investor community in Australia.

Mr Cheo Ming Shen, chief executive officer of Singapore-based social media firm The Netccentric, said: "Australian investors are more savvy and receptive to tech stocks (having had experience with many precedents).

THE ATTRACTION

Australian investors are more savvy and receptive to tech stocks. SGX, or Catalist for that matter, does not have the same... investor ecosystem necessary to facilitate a successful tech listing, particularly in the small- to mid-cap segment.

'' MR CHEO MING SHEN, chief executive officer of Singapore-based social media firm The Netccentric.

"SGX, or Catalist for that matter, does not have the same fundamental investor ecosystem, necessary to facilitate a successful tech listing, particularly in the small- to mid-cap segment."

Netccentric, which listed on the ASX last July, raising A$12.5 million, now has a market capitalisation of more than A$28 million (S$28.6 million).

Mr Patrick Khor, group CEO of entrepreneurship training and consultancy provider iBosses,which listed on the ASX mainboard last September, added: "SGX usually attracts more traditional companies. We are in the non-traditional type of industry, and it will take time to gain traction with investors here."

Additionally, he said, listing and lawyers' fees for an IPO are much cheaper in Australia, than in Singapore or Hong Kong.

But things are changing. The report noted that SGX has launched several initiatives to help tech start-ups list more easily. This includes its junior board, Catalist, as well as efforts to educate investors.

Tan Weizhen

A version of this article appeared in the print edition of The Straits Times on March 05, 2016, with the headline 'Tech start-ups opting for ASX listing'. Print Edition | Subscribe