Li bridges investment gap with smaller firms

Micro Connect, founded by Hong Kong Exchanges and Clearing (0388) former chief executive Li Xiaojia, launched operations yesterday.

The investment platform connects mainland micro-enterprises and global capital, bringing opportunities to international investors to share both risks and rewards with the companies.

Li pointed out that the platform advocates a small and micro enterprise investment model titled “Drip Irrigation Connect” which hopes to invest institutional investors’ funds into tens of millions of small and micro enterprises.

The company will help repair China’s “economic cells” by injecting capital into the balance sheets of small and micro enterprises, he said.

Although the small and micro economy in the mainland is dynamic and the overall scale is huge, global investors have not yet stepped into it, said Li.

The platform’s investment strategy, shortformed as “Sharpe,” represents six ideas. “Small in amount” and “Huge in number” for a diversified portfolio; a digitalized revenue control mechanism and automated repayment mechanism “Arm,” will be established, as well as revenue distribution rights, “RDR,” a portfolio allocation strategy, “Progressive allocation strategy,” and a digital trading platform “Exchange.”