Investor who gains 200, 000% on Alibaba bets big on smart cities

Alibaba Group Holding Ltd, which revolutionised online shopping in China and debuted 15 years later with the world’s largest initial public offering (IPO), yielded a 200-fold return for Tam and his partners.

SHANGHAI: In 1999, Benson Tam decided to help out his buddy Joe Tsai and orchestrated a US$500, 000 (RM2.07bil) investment for his then-untested startup.

That company turned out to be Alibaba Group Holding Ltd, which revolutionised online shopping in China and debuted 15 years later with the world’s largest initial public offering (IPO), yielding a 200-fold return for Tam and his partners.

In contrast with his decisive bet into Alibaba, Tam has spent the better part of the past decade studying and planning for what he believes will be the transformative trend of the new century.

Now, his Venturous Group is preparing to step into the limelight, raising US$131mil (RM541.75mil) to help bankroll China’s so-called New Infrastructure plan: a multi-trillion-dollar vision to lay the foundation for the country’s future by building everything from intelligent cities to sprawling ultra-fast networks.

It’s a vastly longer-term bet than the rocket ship that was Alibaba, but Tam believes the payoff could be similar in magnitude if he plays his cards right.

“Think before you act, aim before you shoot, ” said the methodical 57-year-old, adding that he read 400 books and tested the waters with several personal investments in the seven years before launching his new venture.

Tam’s Venturous is the product of a three-decade career during which the veteran has backed other early Internet giants and helped pioneer venture investing and private equity across the world’s No. 2 economy.

His journey into finance began in 1989 as an investment banker at S.G. Warburg in London. The Asia IPO boom two years later brought Tam back to his hometown of Hong Kong, where he shepherded companies going public for East Asia Warburg, followed by stints working on private equity at Hellman & Friedman Asia and Electra Partners Asia.

The successful bet on Alibaba, made jointly with Fidelity Investments, led him to co-found Fidelity Growth Partners Asia in 2002, where he played a key role in growing assets 200-fold to US$4bil (RM16.54bil) in just a decade.

Tam’s signature investments also include AsiaInfo Holdings, which built China’s first national broadband network and became one of the first Chinese tech listings on the Nasdaq.

Tam’s early experience taught him the value of personal relationships and the Hong Kong native moved to Beijing in 2002 to befriend mainland entrepreneurs.

One of his key goals in his early days as a venture capitalist was to be invited by startup founders and fellow investors to weekend parties. — Bloomberg

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