Asia Business Podcast Navigating Cross-Border Investments and Family Offices with Danye Wang
Navigating Cross-Border Investments and Family Offices with Danye Wang
In this episode of the Asia Business Podcast, we are privileged to have Danye Wang as our special guest. Danye is the managing partner at UniGlobe Capital, an institutional advisory firm focused on international allocation and family offices, as well as cross-border investments. Your host, Art Dicker, delves into a comprehensive discussion with Danye about her professional journey and the burgeoning family office landscape in Asia.
Introduction to Danye Wang
Danye Wang has an illustrious career trajectory that began in China. She moved to the United States for her college education and graduated during the financial crisis of 2008. Against the odds, she secured a role at BlackRock, which has now grown to be one of the world's largest asset managers. At BlackRock, Danye held a client-facing role, dealing with central banks, sovereign wealth funds, and insurance companies.
Through her career, Danye has gained profound insights into the evolving investment landscape and the myriad opportunities and challenges within it. She brings a wealth of knowledge and experience, particularly in the context of international investments and family offices.
The Growth of Family Offices in Asia
Asia has witnessed substantial growth in the number of family offices over recent years. According to recent stats, about 9% of the world's 20,000 family offices are located in Asia. This number is set to surge as Asia's ultra-high-net-worth individuals (UHNWIs) grow by almost 40% from 2022 to 2027.
Danye notes that family offices in Asia are relatively new, with around 40% of them being established post-2010. Several factors encourage the creation of family offices, including significant exit events, generational transitions, and the need for diversification. Family offices can handle an array of activities from investment and tax planning to philanthropy and family governance.
Navigating Investment Opportunities
The conversation takes an insightful turn as Danye delves into why UHNWIs would set up family offices. The discussion encompasses several key aspects:
- Separation of Legal Entities: To ensure accountability and professionalism in their financial activities.
- Proactive Investment Behavior: Whether they set up single-family or multifamily offices, Danye emphasizes the proactive nature of these entities in sourcing investments.
- Diversification: One of the primary drivers behind setting up family offices is the diversification of investments to manage risk and explore new opportunities beyond traditional sectors like manufacturing and real estate.
Art Dicker touches on a stereotype that Asian investors often want safety, liquidity, and high returns all at once. Danye confirms that while such expectations were prevalent in the past, the landscape is shifting toward more realistic and sophisticated investment strategies.
Single vs. Multifamily Offices
The debate between establishing single-family offices versus joining multifamily offices is a significant consideration. Danye explains that the choice often boils down to factors such as costs, expertise, and control. Single-family offices offer greater control and emotional attachment, but they come with higher operational costs. The general guideline suggests starting a single-family office only with assets above 50 million USD, ideally 100 million USD.
Multifamily offices, on the other hand, offer economies of scale and access to diversified investment opportunities. They often attract professionals from private banking backgrounds, bringing a wealth of experience and networks.
Investment Screening and Talent Acquisition
An essential part of managing a family office is talent acquisition and the structuring of investment strategies. Danye emphasizes that screening quality investments requires understanding the team, strategy, and track record. For family offices, hiring talent from investment banks, private equity, and asset management firms is crucial for maintaining a robust investment strategy.
The Singapore vs. Hong Kong Dilemma
Towards the end of the discussion, Danye sheds light on the trend of family offices setting up in Singapore vs. Hong Kong. While Singapore has seen a huge influx of family offices due to its stable political climate and international connectivity, Hong Kong offers a robust financial sector with access to top global banks and asset managers. Despite recent scrutiny over asset flows into Singapore, it continues to be a preferred destination for many family offices.
Conclusion
The comprehensive discussion with Danye Wang underscores the dynamic and evolving nature of family offices in Asia. From understanding the factors driving their establishment to navigating investment opportunities and talent acquisition, the episode offers a wealth of insights for anyone interested in the world of family offices.
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Timestamps
00:00 Introduction and Guest Welcome
00:33 Danye Wang's Background and Career Journey
04:53 Growth of Family Offices in Asia
10:17 Setting Up and Managing Family Offices
26:48 Direct Investments vs. Fund Allocations
37:53 Choosing Between Single and Multi-Family Offices
48:34 Hong Kong vs. Singapore for Family Offices
53:37 Conclusion and Contact Information