SRA_16 - Alex Lee V.2_1.mp4

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SRA_16 - Alex Lee (1).vtt

ENGLISH

{{00:00:05}}
SRA_16 - Alex Lee: I'm here at
SuperReturn Asia with Alex Lee,

{{00:00:07}}
Managing Partner at Axiom Asia.

{{00:00:09}}
Welcome, Alex.

{{00:00:10}}
Thank you, Dorothy.

{{00:00:11}}
Tell us a bit about Axiom Asia.

{{00:00:13}}
So we're a fund manager that's focused
on the Asian private markets, and we're

{{00:00:17}}
investing through primary funds, co
investments, and secondaries across

{{00:00:22}}
venture growth and buyout strategies.

{{00:00:25}}
Since 2006, we've been investing in all of
the key Asian economies, including India,

{{00:00:31}}
Southeast Asia, China, Japan, and Korea.

{{00:00:35}}
We currently manage over 8 billion
of capital and our investors

{{00:00:40}}
include pension funds, endowments
and family offices in the Americas,

{{00:00:45}}
Europe, Middle East and Asia.

{{00:00:48}}
That sounds like a significant operation.

{{00:00:50}}
What are some of the
drivers for your strategy?

{{00:00:53}}
There are quite a number of drivers
for investment strategy and I'd

{{00:00:58}}
like to highlight two key drivers.

{{00:01:00}}
So there's demographics
and consumption trends.

{{00:01:04}}
So demographics varies across
Asia from country to country.

{{00:01:08}}
For example, in India and Southeast
Asia, we have very young populations.

{{00:01:12}}
In fact, a quarter of the
population is below 15 years old.

{{00:01:16}}
And with this kind of demographic
profile it's really driving growth

{{00:01:22}}
and innovation in certain sectors like
education, entertainment, and technology.

{{00:01:27}}
On the other hand, Japan
and Korea are aging rapidly.

{{00:01:31}}
Investors may see this as an all blow.

{{00:01:35}}
but at the same time it presents
attractive investment opportunities

{{00:01:39}}
in sectors such as healthcare, senior
living, and workforce automation.

{{00:01:45}}
The elderly population itself
is also a source of youthful.

{{00:01:51}}
There are some two and a half
million business owners in Japan

{{00:01:55}}
who are older than 70 years old.

{{00:01:58}}
And many of them are looking to
retire but are unable to find

{{00:02:02}}
a successor for their business.

{{00:02:04}}
So this presents a big opportunity
for buyout funds and opportunities.

{{00:02:08}}
to provide them with liquidity
and also to help facilitate

{{00:02:13}}
a smooth business succession.

{{00:02:16}}
And that's really interesting.

{{00:02:18}}
And you mentioned some of the countries,
what are the geographic opportunities?

{{00:02:23}}
Where are you seeing the most
opportunities geographically?

{{00:02:27}}
So for our primary fund investing
and also co investments, we are

{{00:02:32}}
seeing opportunities all across Asia,

{{00:02:36}}
and particularly in Japan,
Australia, and India.

{{00:02:41}}
For our secondaries, we are
seeing a lot of activity in

{{00:02:44}}
India, Southeast Asia, and Korea.

{{00:02:48}}
There's a, there's an opportunity for us
to provide liquidity to venture funds.

{{00:02:54}}
Some of these venture funds have nurtured
successful companies all the way from

{{00:02:59}}
early stage to the growth stage, and they
are looking to crystallize their gains.

{{00:03:05}}
There's an opportunity for us to partner
with them, to provide an exit to them,

{{00:03:11}}
and we can then journey with the portfolio
company on the next stage of growth.

{{00:03:18}}
Being an Asia focussed fund, how do
you determine the relative allocations

{{00:03:24}}
of your fund to different regions?

{{00:03:26}}
We do look at a number of factors,
and I think one of the things

{{00:03:30}}
that we pay attention to is the
fund flows across the region.

{{00:03:36}}
You know the

{{00:03:39}}
the availability of capital relative to
the size of opportunity in each market.

{{00:03:48}}
For example, as a firm, we have actually,
done very well in China, since our first

{{00:03:58}}
fund in two thou that we raised in 2006.

{{00:04:02}}
We have enjoyed very strong returns
from China, but starting from 2016

{{00:04:07}}
we started to underweight China.

{{00:04:11}}
Relative to the markets because we
felt that there was maybe a bit too

{{00:04:16}}
much money pouring into the private
markets there and this was driving up

{{00:04:22}}
valuations and making the investments
less attractive So in response, we

{{00:04:31}}
started to shift our capital to other
markets that were being overlooked.

{{00:04:35}}
For example, Japan now
interestingly, Japan is still

{{00:04:40}}
Asia's second largest economy.

{{00:04:44}}
But when for every 10 that was going into
Chinese private equity, there was less

{{00:04:51}}
than 1 going into Japanese private equity.

{{00:04:57}}
We are very fortunate actually that
this shift of capital has given

{{00:05:02}}
us good returns, not just from
Japan, but also in other markets

{{00:05:07}}
like Australia, Korea and India.

{{00:05:09}}
So the other thing that we pay
attention to is the ease of investment

{{00:05:14}}
and also the, exit strategies, right?

{{00:05:19}}
So there are a couple of questions that we
would ask as an investor, for example, are

{{00:05:25}}
there enough high quality companies for
us to invest in at a reasonable valuation?

{{00:05:31}}
Are there sufficient paths to liquidity,
whether it's IPO or trade sale?

{{00:05:38}}
And the exit is important.

{{00:05:42}}
Focusing on the exits that's, been
very important for us, and this has

{{00:05:46}}
enabled us to generate distributions,
even during challenging times such

{{00:05:53}}
as in the last couple of years,
when distributions have been slow

{{00:05:57}}
throughout the private equity industry.

{{00:05:59}}
So I think we are very, fortunate
that since 2022, we've been able

{{00:06:04}}
to distribute almost 2 billion
of cash back to our investors.

{{00:06:10}}
Alex, this has been incredibly insightful.

{{00:06:12}}
Thank you so much for joining us today.

{{00:06:14}}
Thanks so much, Dorothy.

SRA_16 - Alex Lee: I'm here at
SuperReturn Asia with Alex Lee,

So we're a fund manager that's focused
on the Asian private markets, and we're

investing through primary funds, co
investments, and secondaries across

Since 2006, we've been investing in all of
the key Asian economies, including India,

We currently manage over 8 billion
of capital and our investors

include pension funds, endowments
and family offices in the Americas,

That sounds like a significant operation.

What are some of the
drivers for your strategy?

There are quite a number of drivers
for investment strategy and I'd

So there's demographics
and consumption trends.

So demographics varies across
Asia from country to country.

For example, in India and Southeast
Asia, we have very young populations.

In fact, a quarter of the
population is below 15 years old.

And with this kind of demographic
profile it's really driving growth

and innovation in certain sectors like
education, entertainment, and technology.

On the other hand, Japan
and Korea are aging rapidly.

but at the same time it presents
attractive investment opportunities

in sectors such as healthcare, senior
living, and workforce automation.

The elderly population itself
is also a source of youthful.

There are some two and a half
million business owners in Japan

And many of them are looking to
retire but are unable to find

So this presents a big opportunity
for buyout funds and opportunities.

to provide them with liquidity
and also to help facilitate

And you mentioned some of the countries,
what are the geographic opportunities?

Where are you seeing the most
opportunities geographically?

So for our primary fund investing
and also co investments, we are

and particularly in Japan,
Australia, and India.

For our secondaries, we are
seeing a lot of activity in

There's a, there's an opportunity for us
to provide liquidity to venture funds.

Some of these venture funds have nurtured
successful companies all the way from

early stage to the growth stage, and they
are looking to crystallize their gains.

There's an opportunity for us to partner
with them, to provide an exit to them,

and we can then journey with the portfolio
company on the next stage of growth.

Being an Asia focussed fund, how do
you determine the relative allocations

We do look at a number of factors,
and I think one of the things

that we pay attention to is the
fund flows across the region.

the availability of capital relative to
the size of opportunity in each market.

For example, as a firm, we have actually,
done very well in China, since our first

We have enjoyed very strong returns
from China, but starting from 2016

Relative to the markets because we
felt that there was maybe a bit too

much money pouring into the private
markets there and this was driving up

valuations and making the investments
less attractive So in response, we

started to shift our capital to other
markets that were being overlooked.

For example, Japan now
interestingly, Japan is still

But when for every 10 that was going into
Chinese private equity, there was less

than 1 going into Japanese private equity.

We are very fortunate actually that
this shift of capital has given

us good returns, not just from
Japan, but also in other markets

So the other thing that we pay
attention to is the ease of investment

So there are a couple of questions that we
would ask as an investor, for example, are

there enough high quality companies for
us to invest in at a reasonable valuation?

Are there sufficient paths to liquidity,
whether it's IPO or trade sale?

Focusing on the exits that's, been
very important for us, and this has

enabled us to generate distributions,
even during challenging times such

as in the last couple of years,
when distributions have been slow

So I think we are very, fortunate
that since 2022, we've been able

to distribute almost 2 billion
of cash back to our investors.

Alex, this has been incredibly insightful.

Join Dr. Dorothy Kelso, Managing Director, SuperReturn, at SuperReturn Asia as she chats to Alex Lee, Managing Partner at Axiom Asia. Alex provides an overview of Axiom Asia's investment strategies in Asian private markets, discussing their focus on primary funds, co-investments, and secondaries. They delve into the key drivers of their strategy, such as demographics and consumption trends, and highlight geographic opportunities in countries like Japan, Australia, India, and Korea. Alex also shares insights on how Axiom Asia allocates funds across different regions and the importance of exit strategies in generating strong returns. 