Singapore: Prolific investor. Contrarian extraordinaire. Investment banker. Best-selling author. Jim Rogers wears many hats, and is not tied down by labels or conventional wisdom, but has refused to bite the bullet when it comes to investing in start-ups, which he considers notoriously high-risk.
Yet, even Rogers appears to be joining the bandwagon going by his track record over the last 12 months, during which he has invested in four start-ups. He defends his decision and says his start-up investments are not about the capital. The entrepreneurs approached him directly, which got him interested, and Rogers is not changing his spots.
“These founders were smart people and they reached out to me and asked, would you invest with us, and I said yes,” he said in a recent interview.
Three of his investments in this space are Korean firms, including Standard Graphene, the country’s first manufacturer of graphene, a thin layer of pure carbon.
“Graphene, according to scientists, is going to be as important to the world as scientists. I did not say that, but scientists say it—it is thinner than paper and stronger than steel and they can even use (it) to purify salt water. I have been bullish on graphene for a long time, and all of a sudden an entrepreneur in this space shows up—he has been in this business for a while, and therefore I put in some small amount of money,” Rogers explained.
Rogers has also invested in two fintech start-ups—Korea’s Wealth & Liberty, which provides financial advisory services using a robot adviser, and Chinese online brokerage firm Tiger Brokers. The latter was also his first investment in a Chinese start-up.
Rogers said he is “investing in the founders” and not the companies. “I know nothing about fintech. But I found these were smart people and they contacted me directly,” he said.
Tiger Brokers, which allows Chinese investors to buy stocks from the US and Hong Kong, recently disclosed a funding round worth $14.5 million, the third for the company since it was founded three years ago. Rogers declined to state the amount he had put into the company, whose other investors include heavyweights such as Xiaomi Technology, China Growth Capital, and Citic Securities.
His logic behind investing in Tiger Brokers: “I know the Chinese are going to be huge forces worldwide in the financial markets for the rest of the century.”
Rogers’ first start-up investment was in 2016, when he invested an undisclosed amount of capital in Illimus, a Korean cosmetics company.
His investment was based on the fact that he found its founders were “smart and driven”, rather than the company’s prospects.
“If I lose all my start-up investments, it is not the end of the world. The way I look at it—if these investments come to nothing, I won’t even notice. I don’t pay any attention to my start-up investments,” he added.
But as an investor, by keeping away from start-ups, did he pass up on the opportunity to make huge returns over the last few decades?
“Many of the start-ups have become gigantic, or will become gigantic in the next 20 years. But thousands of start-ups have disappeared in the last 20 years. We remember Facebook because it is successful, but we don’t remember MySpace—it was a gigantic failure backed by unbelievably smart people with money including (News Corp. chief Rupert) Murdoch.”
“Ask me again in 10 years, and even 10 years later, I don’t think I will have many more start-up investments than I have now. Maybe some really smart guy or woman comes and meets me, I may do something, but I am not changing my spots and my start-up investments are all coincidental,” the veteran US investor, who now lives in Singapore, added.