Alibaba fund joins $150m round of Hong Kong fintech firm

Hong Kong-based fintech firm Qupital has raised US$150 million through a combination of series B equity funding and a receivables-backed securitization facility. 

The round was led by Greater Bay Area Homeland Development Fund (GBA Homeland), with participation from the Innovation and Technology Venture Fund, MindWorks Capital, Silverhorn, and the Alibaba Entrepreneurs Fund. 

Qupital co-founder and president Andy Chan (left) and co-founder and CEO Winston Wong / Photo credit: Qupital

Also joining the round as a new investor is UK-based Nordstar, which Qupital said will assist it in expanding its customer base in the Western markets and accelerating its global expansion plans.

Founded in 2016 by Forbes 30 Under 30 listees Andy Chan and Winston Wong, Qupital specializes in cross-border ecommerce trade finance. The Hong Kong-based firm, which has offices in Shenzhen, Guangzhou, Fuzhou, Shanghai, and Hangzhou, also leverages big data, machine learning, and predictive analytics to automate credit decisioning and monitoring.

As of October 2021, Qupital has recorded more than US$500 million in loan advancements for the nearly 7,000 merchants on its platform and is tracking an annualized gross merchandise value of over US$3 billion.

The company added that it will leverage GBA Homeland’s network to expand in the Guangdong-Hong Kong-Macao Greater Bay Area and in other parts of China. 

“With China cross-border ecommerce sustaining a 20% year-on-year growth, the rapid industry expansion renders extra confidence for Qupital to grow its customer base beyond its existing force, which concentrates in Guangzhou and Shenzhen,” the company said in a statement.

Qupital said it will use a majority of the funds from the round to push its lending business for ecommerce sellers, and as part of a five-year plan, it will also grow its buy now, pay later product. 

Other focus areas include enhancing its research and development capacity and expanding its footprint across China as well as in other regions like Southeast Asia, North America, and Europe. The company added that it will triple the size of its team by 2022 to support its expansion plans. 

As part of the deal, Qupital has also entered a securitization facility with investment bank Citi, with support from the Integrated Alternative Credit Fund. The company claimed that this was the first ecommerce merchant financing securitization in Asia, adding that the facility will help it offer exclusive products to its present and future clients.