In the recent Tech Investments in Asia webinar, Panel 3 had an in-depth discussion on SPACs and other fundraising structures and covered the following: How Asian investors could use capital markets to fund their tech companies. They also talked about innovative capital raising structures and mechanisms that can be used by tech companies.
Yang Eu Jin of RHTLaw Asia kicked off the discussion with a comparative study of SPACs in the following jurisdictions: Singapore, HK, UK and US. Detailing the main characteristics of SPACs in each of these jurisdictions, Eu Jin compared and contrasted the similarities and differences that existed between the jurisdictions, and explained the implications of these structural differences, and what companies and potential investors should search.
Leveraging his extensive experience in private equity and venture capital investments, as well as his recent experience in listing one of the first SPACs in Singapore, Novo Tellus Alpha Acquisition, Irwin Lim, Chief Financial Officer of Novo Tellus Capital Partners, built on Eu Jin’s comparative study with its own comparative analysis of three fundraising methods. In his analysis of private fundraising (i.e. venture capital), SPACs, and traditional IPOs, Irwin detailed the main advantages and disadvantages of each of these methods and outlined the considerations companies should keep in mind when deciding how to fundraise. . Going deeper into the SPAC process, Irwin also unpacked in detail the mechanics and timing of the de-SPAC process.
Raj Dewan of McMillan provided an overview of fundraising mechanisms available in Canada. In particular, Canadian financial markets have historically been very conducive to raising capital for public venture capital, compared to traditional private venture capital. Sectors that have been successful in raising capital in Canada include mining, technology and life sciences. Canadian capital markets provide an avenue for companies that may not meet the listing requirements of other international stock exchanges such as NASDAQ. The value proposition of Canadian capital markets is that they are a good gateway for a business to (i) register first, (ii) learn the ropes and grow as as a public company, and then (iv) explore the possibilities of listing on another international stock exchange.
Ben Tai, Head of Product and Business Development, RHT DigiCapital, provided a macro and micro perspective on security token offerings, covering the general process of asset tokenization (including structuring considerations), and a Industry SWOT analysis and business case for security token offerings. Ben acknowledged that although STOs are a relatively new way to raise funds and still subject to a regulatory discovery process, they offer considerable flexibility in securitizing a variety of assets.