In this edition of ‘How to Succeed‘, we speak to Kelvin Lei — CEO & co-founder of award-winning Fintech robo advisory firm, AQUMON — about his inspiration behind the company, how the world of Fintech is likely to evolve, and his golden rules for making your first investment.
On a mission to leverage smart technology and to make next-generation investment services accessible to the general public, CEO & co-founder of Hong Kong’s leading investment platform, AQUMON, Kelvin Lei, is empowering people through his automated application that enables anyone to invest and maximise their returns.
Leaving his corporate finance job back in 2015, Kelvin’s sharp sense for institutional needs, means that he is now driving the adoption of artificial intelligence and automation technology within banks, asset managers, and wealth managers, and continues to pave the path for AQUMON’s product development and market strategies. Previously Vice President of Deutsche Bank’s Institutional Client Group and having spent time with Credit Suisse and CICC, where he acted as the sole coverage for China Merchant Bank and covered top-tier asset managers such as PIMCO and BlackRock respectively, there is no denying that there is a lot we can learn from this finance savvy entrepreneur.
Tapping in to his insights and expertise, we spoke to Kelvin about the challenges he faced in the conception phase of the business, what it takes to succeed in the world of Fintech, and his top tips for making your first investment.
For those who aren’t familiar with the world of investment, give us a brief overview of your career. How did you get into the Fintech industry? Was there a specific moment that inspired you?
Finance was a path I always knew I’d be on since I left university. My career led me through different posts in renowned banks and I ended up in the Fixed Income and Sales & Trading team at Deutsche Bank — it was a very lucrative business until the financial crisis. That was when I realised the banking industry’s policies were not always in the interest of clients. In fact, I personally found it very difficult to invest in other products as a retail investor. That was when I realised there’s a market for digital, algo-driven wealth management products – I wanted to create a solution for anyone to invest. Prof. Don and I wanted to empower 95% of the population, those underserved by traditional private banks, so that the power of investing is in the people’s hands.
Tell us more about AQUMON. What was the inspiration behind the company? How has it evolved since conception?
Traditional wealth management advice is only offered exclusively to the wealthy and privileged few. We want to make investments simple, affordable, transparent and accessible to everyone. Our mission is to transform the financial industry by empowering people to participate in wealth creation and bring about real social progress.
We have grown much bigger since the conception of AQUMON. I left my corporate finance job back in 2015. Prof Don Huang (my co-founder) and I were working together without any office or any funding while we prepared for AQUMON’s launch: acquiring licenses and working on our quantitative algorithms and fundraising strategy. Our actual work place for a while was the HKUST library until we were incubated by HKUST in 2016. At the time we were given an office, which we were very grateful for, but it was one without windows; our interns and student researchers totaled six people at the very beginning. Today, we are in a great office with ceiling-to-floor windows; our team now comprises 120+ talents. We are very grateful for all the support from our investors, stakeholders and our own team along the way to have reached where we are today.
Who is one person who has been instrumental in your success?
I would say my partner, Don, who has been here since the beginning of our startup journey. Don’s always been a great friend, we’ve known each other for 13 years already and he is one of the most intelligent, and hardworking people I know. Not only do we have great working chemistry but we also share the same vision for our company’s growth. He is instrumental in the running of our quantitative strategies whereas I handle the business components of the company; we complement each other. We also enjoy spending free time together with our family and children.
To you, what’s the most important aspect, trait or criteria for someone to succeed in the world of Fintech?
I believe to make it in the Fintech world, first of all you have to offer a strong value proposition. You need to have your core technological offering and not blindly chase the trend. Secondly, you need to have clear vision and grit to persist through the challenges as the market can become very competitive and there will always be disbelievers. Finally, you need to build on other people’s talents.
In the course of your career, describe one of the toughest or most challenging experiences you’ve been through. What was the most valuable thing you learned?
I got laid off by the bank but I’m grateful for the experience as I learned that I’m not suitable for the corporate scene and it launched my career as an entrepreneur. The world can be your oyster but you must work hard and fight for it!
What does an ‘average’ work day look like for you?
An average workday during COVID times is very different from before when I would have a lot of face-to-face meetings. Nowadays my work day begins as soon as I wake up and switch on my computer. We would have different departmental meetings scheduled throughout the day to ensure all our teams are communicating effectively. Since we also have a Shenzhen office, we utilise our internal softwares to maintain accessibility at all times. Our office has a relatively longer lunch break, where I like to step away and relax before the hectic schedule starts again. My afternoon is generally packed with interviews and meetings with small blocks of time to work in between. My day usually ends around 7:30-8pm in the office and I head home to my kids and wife. As a business owner you are never really switched off, but my work is my passion, and I enjoy thinking of new ways to grow our business and inspire the team.
In your opinion, Will computers replace humans in the world of asset management?
Ultimately smart technology and automation will replace some human efforts in this wealth management space. Humans have limitations such as processing large amounts of information accurately and objectively, whereas our current system can analyse and monitor over 8000+ investment instruments simultaneously.
I do believe that machine learning and big data will help us sort through data rapidly and provide scientific, quantitative recommendations. In the future, digital wealth management services, like AQUMON, will become a staple banking offering similar to deposits and loans. Moreover, smart technology will enable companies to lower their costs, increase transparency; allowing more people to invest in diversified global assets and enjoy risk-adjusted returns.
However that is not to say humans become obsolete; it actually means that through technology we are freed up to pursue greater value-added service that computers and machines cannot achieve. The Robo-advisor is not a substitution of traditional financial planners, but a tool that helps financial planners to save time and energy, so that they can focus more on the development and maintenance of customer relationships, which will always be a crucial element to any success, and that is why we also have a designated customer relations department
Do you think Hong Kong provides a good environment and opportunities for entrepreneurs?
The Fintech startup climate is great in Hong Kong. Hong Kong is home to a number of venture capital firms and acceleration programs aimed at helping promising startups grow. AQUMON itself benefited from this Fintech support as can be seen through our latest series pre-B funding $30 million USD despite the COVID pandemic in 2020.
Hong Kong is a world renowned financial market that is bolstered by one of the world’s simplest tax systems; we have a strong, stable legal and regulatory regime that is conducive to business. There is also a strong concentration of capital as well as talent in this area.
Moreover, forward thinking regulations enable flexibility for innovations whilst safeguarding the interests of the public. AQUMON is one of the pioneers of digital wealth management that is fully licensed and regulated.
We believe that Hong Kong itself is a great platform to extend into other markets in the region. Hong Kong, as one of China’s most international cities, helps to make it easier to connect with the mainland. The unique position Hong Kong has in Asia is unparalleled in terms of resources and geo-political advantages. It is the number one offshore RMB trading center. Hong Kong is also part of the [Guangdong-Hong Kong-Macau] Greater Bay Area and CEPA that provides gateway access to the mainland market. We are currently expanding our business to China as AQUMON recently received the private investment fund license from the Asset Management Association of China. We foresee great growth potentials in the region.
Any tips for those looking to make their first investment?
You’ve got to start somewhere. Saving alone is not enough to grow one’s wealth. To achieve financial stability, one must stay ahead of inflation and start investing.
The three golden rules of investing:
- Long-term investing
We can look to Gamestop (GME) as a recent example, it may be exciting to chase the market and speculate by buying a singular stock. However just as we saw last week, the markets are volatile. Ultimately there are high gains but also high losses. For retail investors who do not understand the market as well as the professionals, single stock investments leave them exposed to high risk, hence we always advise to diversify – even if one sector may be underperforming, your other investments will make your portfolio much more resistant to market volatility.