Me & My Money

Show him the value and he'll go all out for all it's worth

Investor Adrian Chng says society has all sorts of problems if people do not have jobs. So he wants to make private equity and venture capital-type investments to help companies grow and ultimately create employment.
Investor Adrian Chng says society has all sorts of problems if people do not have jobs. So he wants to make private equity and venture capital-type investments to help companies grow and ultimately create employment.PHOTO: AZMI ATHNI FOR THE SUNDAY TIMES

Adrian Chng's firm invests in ideas it believes will be the foundation for the economy of the future

A missed opportunity to work for Bain International in a strategy consultant position sent entrepreneur Adrian Chng on a career in the world of investment banking.

The Bain job required Mr Chng to relocate to Sydney from Melbourne after graduation, but that did not work out as his then girlfriend was living in the southern Australian city and a move north was out of the question.

That led Mr Chng to join SBC Warburg - now known as UBS Bank in Australia - where he learnt the ropes of investment banking.

Mergers and acquisitions (M&As), buying and selling companies and live transactions became part of his day's work. He also learnt the art of valuing a company through its forecasts, its fundamentals, market reports and analysis.

Between 2011 and 2014, Mr Chng, 43, helmed pan-Asian job portal JobsDB.com out of Hong Kong and led its A$1 billion (S$1.05 billion) merger with JobStreet.com in 2014.

He then co-founded venture capital and alternative assets fund management firm Fintonia Group with a seven-figure investment in 2015. The firm invests in ideas that it believes will be the foundation for the economy of the future.

The Singapore permanent resident who hails from Malaysia saw it as a natural progression for his career, given his experience in finance, and the growth of the telecoms industry and technology.

A divorcee with a 10-year-old daughter, he had graduated from the University of Melbourne with a Bachelor of Laws in 1998 and Bachelor of Commerce in 1995.

Mr Chng says his private firm is on the lookout for things of value, be it a physical set-up or an idea, that can be developed successfully.

  • Worst and best bets

  • Q What has been your best investment decision?

    A My best investments in both time and money have been those that have helped me grow professionally and personally. I invested early in my career by working with great people and gaining fantastic experience, and not chasing after short-term monetary awards. The returns have been priceless.

    It has been said that we are the average of the five people we spend the most time with. I believe that leaders should regularly invest in their own personal development and challenge themselves in order to grow.

    In this regard, I get a lot of inspiration, new perspectives and learning from my fellow Young Presidents Organisation (YPO) peers, particularly those in my forum. I took a great YPO personal development leadership course in France in 2014 and plan to continue doing this regularly.

    On a personal level, I have also tried to maintain a high level of physical and mental fitness. I used to be very fat and lost 19kg through changing my diet. To maintain this, I regularly do crossfit and yoga and try to eat home-cooked meals as often as possible.

    Q What has been your worst investment decision?

    A My worst investment was made in 1999/2000 when I was a junior investment banker working 100 hours a week and feeling jealous about all these people becoming "dot.com" millionaires.

    I recall getting into a taxi at 3am to go home from the office and the taxi driver telling me about how he has made five times his money in only four months by investing in a mining company that changed into a dot.com company.

    I remember wondering why I work so hard when even the taxi driver is making money by investing in dot.com companies, so the next day I invested in a similar firm. I had no idea what the company was doing other than it was becoming a dot.com company.

    Suffice to say the company eventually lost 99 per cent of its value, but I never sold a single share, as a reminder to myself of my mistake. I learnt from this that success does not come easy and everyone has his own stories of success (and failure) and that we should focus on our own journey without worrying about what other people are doing.

Q Moneywise, how were your growing-up years?

A I did not come from a privileged family background but neither did I feel deprived of anything. My parents, who migrated to Australia when my sister and I were young, had to work multiple jobs to make sure we got a good education.

They would work two to three jobs during the week, and during the weekends, they would set up Chinese food stalls at the local market. Those years were difficult for them, but fun for me and my sister.

But in hindsight, I can say they taught me the value of hard work, good education and the importance of passion and energy to make things better.

Q How did you get interested in investing?

A I studied law and commerce in university, but started my career in investment banking with SBC Warburg in Australia. Over the years, I specialised in executive M&As for clients in different industries.

By undertaking detailed due diligence and financial analysis of different companies and industries, I became very interested in understanding the fundamental value of businesses and how the public markets often display a herd mentality to mis-price these companies.

Q Describe your investment strategy?

A To create wealth, in my experience, you need to concentrate your investments in areas which you know well and can add value to. Hence, I invest a significant amount in my business Fintonia Group, as well as in a variety of fintech companies and direct private equity type unlisted investments.

At the moment, Fintonia has two clusters of fintech investments centred around consumer and SME financing, and regulatory compliance.

These include companies with big-data credit scoring technology and digital lending, and firms dealing with non-performing loans, anti-money laundering compliance and so on.

The firms CredoLab, AsiaKredit, Silent8, Asia Collect, Trunomi and Storehub complement one another when it comes to consumer financing and regulatory compliance.

For example, in Indonesia, there are 250 million people, 110 million smartphones, 80 million people with bank accounts and only eight million credit cards. This means 90 per cent of account holders, across the thousands of Indonesian islands, cannot get credit from the banks.

So how do you provide financial services (like lending) to these people? My investment in CredoLab, which provides big-data credit scores to lenders, is with an eye to score these people for credit. Its customers are banks and lenders.

AsiaKredit is a lender that provides direct loans to people who are otherwise unbanked, Asia Collect buys and services non-performing loans and so on. They are all independent companies but reflect our confidence in the huge opportunity to provide financial services in the region to consumers and SMEs that are otherwise underserved and/or unbanked.

These investments could be worth more than US$500 million (S$681 million) in the next three to five years. I am also about to invest in a telecom infrastructure and connectivity company, given the ever-increasing demand for Internet and data access.

We have a structured way of assessing a company prior to investing. We assess the market need, market opportunities and the trends. Instinct and judgment also play a big part in deciding where to invest my money as one has to assess the people running the company and know if the investment is going in the right hands, especially important in these unlisted venture capital and private equity type investments.

Q What's in your portfolio?

A Roughly 20 per cent of my overall seven-digit portfolio value is concentrated on my business (Fintonia Group) and related venture capital and direct private equity investments. The remaining is diversified across different asset classes more for capital preservation.

They are property investments (30 per cent), fixed income (30 per cent), and listed equities and equity funds (20 per cent).

Q What are your immediate investment plans?

A I have a passion for supporting entrepreneurs and helping businesses grow. Jobs and growth come if business owners only take risks and set up or expand their businesses.

Society has all sorts of problems if people do not have jobs. Therefore, my plan is to continue to make private equity and venture capital-type investments and help these companies grow and ultimately create employment.

Q What does money mean to you?

A Money is both a blessing and a curse. Money can give you flexibility and freedom to spend time with family and friends to build authentic and meaningful relationships, but at the same time, it can become a never-ending goal that dehumanises us.

I recall being in a room with people who were asked how much money they needed before they stopped worrying, and the standard answer, regardless of their wealth, was 20 per cent more.

Q How are you planning for retirement?

A I do not plan to retire. I really enjoy the intellectual challenge of growing businesses, making investments and closing deals and have the passion and energy to keep doing this for the foreseeable future.

Q Home is now....

A A rented condo unit located around Orchard.

Q I drive....

A Since returning to Singapore and finding that my almost new 5 series BMW in Hong Kong could buy only the equivalent of a Toyota Corolla, I am grateful for all the investors in Grab and Uber who are subsidising my travel around the country.

A version of this article appeared in the print edition of The Sunday Times on November 05, 2017, with the headline 'Show him the value and he'll go all out for all it's worth'. Print Edition | Subscribe